When Elon Musk announced his bid to merge his two publicly traded companies into one, Wall Street recoiled.
On the face of it, the billionaire Silicon Valley titan wanted to marry Tesla Motors’ battery storage technology with SolarCity’s solar panels and software, creating a vertically integrated clean energy juggernaut. But both companies burn through cash and face significant headwinds as Tesla struggles to deliver its cars on schedule and a finicky solar market lashes SolarCity. The boards are stacked with Musk’s family and allies, threatening to make such a deal a “corporate governance nightmare.” Last month, four lawsuits were filed against Tesla for breaching fiduciary duty by offering to buy SolarCity. Was this a bailout for SolarCity? Would this further delay investors earning a payday through dividends?
Those concerns are likely to come to a head over the next five weeks as both companies gear up for a Nov. 17 shareholder vote on whether to approve the deal. But fears over the future of Musk’s business empire, which also includes privately-held rocket company SpaceX, may be misplaced, according to biographer Ashlee Vance.
“As someone who has spent years studying Musk, though, I find such a future unlikely and also find the cynicism that surrounds Musk somewhere between depressing and ignorant,” Vance, who published the meaty 400-page Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future in May 2015, wrote in Bloomberg Businessweek on Wednesday.
He continued:
At every point where his companies seem to be on stable footing, Musk takes on more and promises more, erasing the memory of past gains. He might now be addicted to one-upping himself.
Wall Street and casual onlookers often find Musk’s approach abhorrent, and this makes perfect sense. They want consistent earnings-per-share figures and straight talk, while he’s in an inventive fugue state more concerned with trying to save mankind from oblivion. Musk lives in a way that few of us would choose and has a tolerance for risk that would drive most of us nuts. It’s precisely because Musk has operated his companies on the edge of what’s possible that he has achieved so much.
Vance, however, is no blind champion of Musk. His biography provided among the most sober assessments of the celebrity businessman yet. The book included some ugly details about a man often lionized as a sort-of tech messiah, bent on weaning the world off oil and coal and sending human colonists to Mars. One in particular ― an anecdote about Musk berating a male employee at Tesla for taking time off to witness the birth of his child ― seemed to ruffle Musk’s feathers. After the book came out, Musk ― who denied the claims on Twitter ― apparently stopped speaking to Vance, according to a report in Motherboard.
Still, Vance said it’s impossible to ignore the imprint the South African-born entrepreneur has already left on U.S. industry.
“With advances in cars, energy, and space exploration, Musk has ushered in a new industrial age,” Vance wrote. “The world of machines and infrastructure suddenly looks poised to advance at a rapid clip. It does not seem hyperbolic to suggest that Musk has played a major role in changing the world.”
It’s difficult to say whether transforming his electric car company into a 21st century energy giant will expand that imprint. But it does seem likely that shareholders will greenlight the SolarCity merger.
After all, a bet on Musk’s companies is usually a bet on Musk himself.
“If you don’t believe in Elon,” David Whiston, an equity strategist covering car companies for the Chicago-based research firm Morningstar, told The Huffington Post in August, “why are you buying these stocks in the first place?”
