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Tesla IPO Raises $226 Million
An anonymous reader writes "Tesla, which will trade under TSLA on Nasdaq, has been priced at $17 per share, allowing the electric car start-up to raise more than $226 million in its IPO. Investors were expecting the share price target range to be between $14 and $16 but the overflow of excitement saw Tesla increase the number of shares it plans to offer to 13.3 million, nearly 20 percent more than originally planned." Reader hlovy contributes a link from Xconomy.com summarizing the skepticism among some analysts as to how much staying power TSLA will demonstrate.
My guess is that the company weighed the merits of continuing to exist against the issues of giving up control. They've lost over $250MM over the last few years and are probably still looking at a few years of losses ahead of them; that money has to come from somewhere. It might as well be public shareholders.
Are you seriously comparing the quintessential .com bubble site to a profitable and innovative car company? Just because their stock price is increasing on opening day doesn't mean that they're about to burst.
For instance, take - Google's stock. There were a multitude of pundits and "experts" claiming that their $100 IPO price levels were totally unsustainable. They looked pretty stupid when the price doubled in 6 months. Sure, Tesla is no Google, but don't imagine that their stock price is guaranteed plummet just because there is a lot of excitement surrounding their IPO.
Maybe the Vulture Capitalists turned them down, or offered them the usual stranglehold deal that vulture capitalists are famous for.
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Disclaimer: I own a Roadster, have a $5k down payment on a Model S, and bought a couple thousand shares of TSLA this morning.
No revenue stream now; no revenue stream until 2012.
This seems to be pretty much parallel to most of the business plans of dot-coms. "We have cool new technology! What, we also need sales?"
It really depends on how well they can market the roadsters... which they have not shown to be one of their strong suits yet. Time will tell. Opening day will not.
More like tied up to hide it from his soon to be ex wife :)
There's a lot of optimism priced into the stock right now. I wouldn't expect them to go out of business in the next couple of years or anything, and I might pick up a few shares if it gets down to $10-$12 or so, but a $22/share price sounds way too optimistic for my liking. I'd wait for the headline-buzz to fade a little before pouring too much money into it.
Telsa is not GOOG. Automobiles are a capital-intensive business.
The World Wide Web is dying. Soon, we shall have only the Internet.
So ultimatley the target market appears to be people with more money than sense; which obviously exists, but I doubt it's large enough to sustain a company like Tesla.
Right. Because if you've got tons of cash you're going to drive a Yaris because the TCO is low. Fark no. You're going to drive a nice ride. You can have sense, cash, and still want a high-end car. It's not an investment.
Tesla's model is new to the auto industry: manufacturer sells direct to consumer, and also owns the distribution network and the service departments. That's nothing new in high tech: Apple's made a fortune using that model.
One difference is that Apple's exposure in a recall is limited to the replacement cost of a small household appliance.
It doesn't have to "service" anything.
Tesla has a $100K Roadster and a $65K Model S sedan in the works.
That implies a full-scale luxury dealer showroom and auto repair garage. Not a niche in the Galleria Mall.
He was also nuttier than a Snickers bar. He had several impressive inventions, but in his "normal" life, he did many strange things.
Who would win this election: Andrew Weiner vs Andrew Weiner's weiner.
Why would anyone want just another run of the mill "family car".
Probably because they have a family and use a car for transportation?
I'm sure that will be a factor for people who already own one when the price of gas starts to shoot up. But I think it's more than "green" is coming along for the ride. Buy a nice luxury car with kick-ass acceleration and be able to make a (barely plausible but hey) claim to being "environmentally conscious"? Take that, Joneses!
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What's the problem with a 300 mile range? I've never understood that. That's five hours of driving at 60 mph, which far exceeds what most family sedans will ever need. If I'm going to travel more than 300 miles I'm letting someone else (pilot, engineer, bus driver, etc.) do the driving for me. Even on my most ridiculous days at work I'm not driving more than two hours from home.
If my neighbors will cough up $70,000 for a Land Rover or H2 then I don't see that price point as an issue, either. Especially since Tesla is known as a luxury vehicle.
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin
Out west, we make longer trips in general (and faster than 60 MPH). We periodically drive 375 miles, one way, to visit my parents, which takes 5-6 hours door to door, depending on traffic. It costs more to fly one person than to drive a carload, and takes almost the same amount of time when you consider local transportation and normal airport dead time. If there is any significant flight delay, it can take longer to fly. Logistics are also simpler to get family and luggage into the car and leave "today", rather than to have to get the family through the airport with luggage on a flight schedule.
However, where range really matters is trips out into the woods, where we may spend a week away from civilization with local driving trips and a very long and inconvenient detour to refuel in the middle. So I really want the range to get out there, tool around, and get back with plenty of safety margin. And while I can consider the first gas station to be civilization with my current car, I may have to travel much further to find a viable charging station for an electric car (and I cannot refuel in a brief 10 minute pause from the highway). As it is, we've nearly run out of fuel on a week long camping trip in the Sierra Nevada, because there are no gas stations inside some of the national parks and a lot of distance between the camping areas, trialheads, and concessions.
For electric cars to take off out here, I suspect a new form of "car stop" would have to emerge, with charging stations in the parking area of restaurants where families could take their meal break from a long trip while the car charges for the 45-60 mins it requires...
To me, that really brought to light just how much the people at Top Gear are biased towards the cars that they like and against the cars that they don't.
And this was new to you? I think it's so strikingly obvious that anyone wanting to learn anything about cars isn't getting anything from Top Gear. I watch it for the Lulz.
And I need a yard of cement from time to time, but that doesn't mean that I have to own a cement mixer. If I owned an electric vehicle and needed to take that once- or twice-yearly long trip I'd rent a long-distance vehicle, the same as I'd rent a cement mixer. Even better is my neighbor's solution for the occasional need for a pickup. The parents bought it used a decade ago, now three of the kids split the insurance and the other stores it in his back yard. When any of the kids or grandkids need a truck they have one, but no one is saddled with the daily cost of driving the gas hog.
"Think about how stupid the average person is. Now, realise that half of them are dumber than that." - George Carlin