It’s been a horrible year for Elon Musk. One even he acknowledges couldn’t have been much worse. “This past year has been the most difficult and painful year of my career,” the billionaire entrepreneur said in an New York Times interview published on Friday. “It was excruciating.”
And if recent history is anything to go by, it may get worse. Just when Musk’s adventures in popular science, from private trips to Mars, high-speed tunnels under Los Angeles to the mass-production of electric sports cars, look like they can’t get weirder, they do.
The Times reported that the 47-year-old entrepreneur alternated between laughter and tears as he described how he has been working 120 hours a week, often staying in the Tesla factory for three or four days straight. The board is worried by his use of Ambien to allow him to sleep – sometimes it appears to have the opposite effect and they are worried he uses Twitter in a mood-altered state.
“If there’s a common denominator to Elon Musk’s troubles over the past two months, it’s Twitter,” Gene Munster, head of research at venture capital firm Loup Ventures, wrote to investors on Friday as Tesla’s shares slid again following the interview.
And then there is Azealia Banks. Last weekend the Harlem-born rapper, who is never one to shy from an online battle, was hanging out at Musk’s Los Angeles home hoping to finish a collaboration with the musician Grimes, the billionaire entrepreneur’s girlfriend, for Banks’ new album, Fantasea II: The Second Wave.
“Literally been sitting at Elon Musks waiting for Grimes to show up and start these sessions,” Banks wrote in an Instagram story. In a conversation with Business Insider, Banks said she’d been sitting in Musk’s home alone for “days”, while Grimes coddled Musk for “being too stupid not to go on Twitter while on acid”.
Those comments came after Musk tweeted he had “secured” funding to take Tesla, his troubled electric car company, private. Tesla’s share price shot up and now the US’s top financial watchdog, the Securities and Exchange Commission (SEC) – and investors – want to know just how “secure” that funding is. Musk says he has never met Banks, but could this bizarre tale lead to her being interviewed by the SEC?
Musk’s now-infamous tweet sent shares in the company surging 11% and cost Tesla stock short-sellers, investors betting on a share price collapse and Musk’s avowed enemy, as much as $1bn. They are suing and Musk has since sought to justify his tweet, writing in a blogpost published on Monday that the Saudi investment fund – which owns 5% of Tesla – had approached him several times over the last two years with offers of help. In the last of those communications, on 31 July, the fund’s managing director “strongly expressed his support for funding a going private transaction for Tesla at this time”, Musk wrote.
If investigators conclude Musk overstated the nature of the financing, that could form the basis for bringing a market manipulation case.
“Our understanding is that there’s enough wiggle room in the language he used to not be in any legal risk of making a misleading statement,” says Munster, who sees a better than 50% chance of Musk taking the company private.
“There’s no fraud here, but there is a question about burning the short-sellers.” Tesla, he says, “could get fined by the Nasdaq [the stock exchange where Tesla is listed]”.
But corporate governance experts see a different scenario playing out. Musk’s first tweet alone would not be a problem, especially if he’d made a full public statement, but Musk’s “in-your-face attitude toward the SEC” is a different matter, argues John Coffee, professor of corporate guidance at Columbia University.
“‘Funding secured’ means you have a firm commitment to able to raise the money you need. He had nothing of the sort,” Coffee argues. Musk’s first tweet was clearly not reviewed by a lawyer, he says, and subsequent communications showed Musk had “at best, a glimmer of hope” he might get some funding from the Saudis.
“He may have made an exaggerated, overstated material misstatement for which he could be sued privately and, under different course of action, by the SEC.”
More here: https://uk.finance.yahoo.com/news/strange-saga-elon-musk-inside-050010465.html
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