Dredging up the past, Elon Musk said today that “starting Tesla” with the two original cofounders instead of just JB Straubel was the “worst decision” of his business career. The comment brings back to light Tesla’s controversial founding.
During a live interview at TED 2022 today, Musk was asked by a fan which one thing he would change if he could go back in time. The CEO’s response was interesting. He linked his answer to Tesla, saying he believes that the worst decision of his business career was to not start Tesla with just JB Straubel, cofounder and longtime CTO at the automaker.
At first, it sounded like Musk wouldn’t name the other cofounders, whom he sees as problematic, but he ended up dredging up the past a little more and mentioning Martin Eberhard, Tesla cofounder and the company’s first CEO.
During the interview, the CEO accused Eberhard of “dedicating his life” to pushing the idea that Musk was not a founder of Tesla. Musk has himself been accused in the past of trying to rewrite Tesla’s founding history, but as with almost with everything, it’s a complicated story with a lot of nuances.
Technically, the company was “founded,” or at least incorporated, in 2003 by Martin Eberhard and Marc Tarpenning – and only them.
While the idea behind Tesla has evolved over the years, it was already pretty close back then to what Tesla is mostly known for today – making electric vehicles that are more compelling than their gas-powered counterparts. More specifically, Eberhard and Tarpenning were looking to capitalize on advances in Li-ion battery technology to deliver an electric car with better performance.
Ian Wright was Tesla’s third employee and joined late in 2003.
Musk famously joined as chairman in early 2004 as part of the company’s series A investment round, which he led with $6.5 million of the $7.5 million round. He already had a longtime interest in electric vehicles and was convinced to invest in Tesla after meeting JB Straubel, who was already aware of the project from being around the EV community in the Bay Area.
Straubel joined Tesla in May 2004 as Chief Technology Officer, a position he held until leaving in 2019.
These are the main facts about the founding of Tesla that are harder to debate, but the importance and impact of all these people at Tesla have been challenged.
These issues all came out in a series of lawsuits and counter lawsuits in 2008–2009 when Eberhard was ousted from the company after difficulties bringing the Roadster to the market and Musk took over the company.
A judge overseeing the cases actually came to the conclusion that all of them – Martin Eberhard, Marc Tarpenning, Ian Wright, Elon Musk, and JB Straubel – should be considered cofounders of the company.
Honestly, I don’t think it’s worth dredging up this era of Tesla because I think the compromise that everyone is considered a founder is perfectly fine.
I don’t think anyone can argue that Musk didn’t have a disproportionate impact on Tesla, and it would not have survived without him. Even if he wasn’t there at the very beginning, he deserves a title of founder in my opinion.
As for Musk downplaying Eberhard’s own role at the company, it seems that most people at Tesla agree that he wasn’t a great business operator and didn’t handle the Roadster program properly. Nonetheless, I think he deserves credit for being an early advocate for electric vehicles and helping the latest electric revolution at its very beginning.
Would Tesla be much different today if Musk and Straubel had been the only ones around in the beginning? Let us know in the comment section below.
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