Elon Musk. Photo: Justin Sullivan / Getty Images
Elon Musk has agreed to be CEO of Tesla for the next decade and could earn as much as $55 billion in stock awards, but “will be paid only if he reaches a series of jaw-dropping milestones based on the company’s market value and operations. Otherwise, he will be paid nothing,” NYT’s Andrew Ross Sorkin writes.
“Tesla has set a dozen targets, each $50 billion more than the next, starting at $100 billion, then $150 billion, then $200 billion and so on, all the way to a market value of $650 billion.”
- Tesla is worth about $59 billion today. Reaching a market value of $650 billion would make Tesla one of the five largest companies in the U.S.
- Musk's "stock award could be worth as much as $55 billion" if he hits that valuation goal. Sorkin notes a sum this high is unlikely.
- Tesla organized a similar setup in 2012 when the company was worth $3.2 billion. Musk met each milestone except for one on the way, per the NYT.
- Critics will be quick to say this is “just the company’s latest publicity stunt... The company continues to lose money; at one point last year, it was losing almost a half-million dollars an hour.”
- Shareholder impact: “if Mr. Musk is gaining billions then shareholders are winning, too. And if Mr. Musk does not perform, shareholders pay nothing.”
- Bottom line for Musk: “I want to contribute as much as possible to humanity becoming a multi-planet species,” he said, alluding to a goal he has talked about often, including having people live on Mars. “That obviously requires a certain amount of capital.”