New York 2006

Chapter 133 Tesla and Musk

"So, your mothers are twin sisters."

Luo Ji looked at Elon Musk and SolarCity founder Lyndon Reeve beside him and asked.

"Yes. We are cousins."

Lyndon Reeve said: "After my software company was acquired by Dell, I started entrepreneurship again. The reason why I entered the new energy field was because my cousin invested in Tesla, and I became interested in new energy. of."

The group of people took a car to SolarCity's corporate headquarters. In addition to the bodyguards and Luo Ji, there were three people in the car, Elon Musk, Bill Lee and Lyndon Reeve.Lyndon Reeve is also a pioneer of the Internet. He is worth tens of millions of dollars.

The three of them are shareholders of SolarCity, and the three of them are also shareholders of Tesla.Elon Musk and Bill Lee heard today that Luo Ji was visiting the company and launching Series D financing, so they both rushed over to meet Luo Ji, a billionaire in the entertainment industry.

Elon Musk is tall, taller and stronger than Luo Ji.The whole person is full of enthusiasm and energy.Looks very confident.

Musk looked at Luo Ji and asked curiously: "Logic, is the music industry so profitable? In the past twelve months, you actually made 1.02 million US dollars in cash. It is difficult for many listed companies in the United States to reach this level. "

"I alone can support a listed company, right?"

Luo Ji smiled and continued: "The key is that the quality of my albums is so good that they sold out immediately. Of my income, record sales account for 67%. I have no plans to release an album next year, so my income will probably drop." few."

Musk thought for a moment: "Logic, do you have your own music company? I saw media reports about the war with Universal Music some time ago."

"Yes." Luo Ji said confidently.

He competed with Universal Music and won in the end. This is what Luo Ji is most proud of so far.

This also brought a lot of convenience to Luo Ji. Among the American elites he met, no one would regard him as a naive 16-year-old singer. No one would dare to treat him as a fool. Everyone respected him.

"You did a great job, Loigc."

Musk then looked at Bill Lee and the others with a smile and said, "What were we doing at the age of 16?"

Bill Lee thought thoughtfully for a moment, and then spoke in a calm tone with pretentious words: "Hum...if I remember correctly, I was in college and participating in a national project."

Luo Ji gave a thumbs up: "Awesome."

None of the three elites in the car are ordinary people, and their experiences are all different from ordinary people.

They basically went to college as teenagers, started a business during college, and then made their first pot of gold. Then they sold the company and achieved financial freedom.Both Musk and Bill are worth more than $[-] million.

Luo Ji also boasted about himself to several elites and showed off his advantages: "I have passed all the high school course exams, and I plan to go to college next year!"

"Very good, college will bring you a lot of different experiences." Musk said with a smile.

"Well, I will cherish my time in college."

Luo Ji showed his signature fake smile and looked at Musk with a smile: "Does Tesla still need financing? I will receive a large amount of funds in the near future."

"In May this year, Tesla just completed its D round of financing." Musk patted Luo Ji on the shoulder and comforted him: "If you really want to invest, I will let you know when the IPO is held."

Luo Ji asked, "Do you really don't need it? I can give you a good price."

"Logic, really, Tesla is not short of funds now." Musk said sincerely: "We now have the money from customers to reserve vehicles, and the money we just raised, the company's cash flow is particularly abundant."

"Okay." Luo Ji smiled and said, "Then you must notify me when you IPO."

"No problem." Musk agreed with a smile.

Luo Ji looked at Bill Lee with envy. He himself had invested in Tesla, a star company in Silicon Valley.

After entering the 21st century, people's awareness of environmental protection has gradually strengthened, and the call for manufacturing an environmentally friendly electric vehicle with high endurance and high performance has once again sounded.Although opportunities have appeared repeatedly, electric vehicles have failed to develop. The root cause is that they not only have relatively high production costs, but also have problems such as troublesome charging, high maintenance costs, and short cruising range. These weaknesses have seriously hindered the popularity of electric vehicles.

So Tesla came into being, and now it's successful.At Tesla's prototype car display last year, California Governor Schwarzenegger, former Disney CEO Mike Eisner, and many Hollywood celebrities attended.Many people have test driven the electric sports car, and the response has been very good.

Luo Ji asked: "I heard that Tesla's electric sports car Roadster costs 100 yuan per unit, and more than [-] units have been pre-sold. Are you now pre-selling the second [-] units?"

"Yes." Musk continued enthusiastically: "All the technical aspects of the Tesla Roadster have been verified and will be mass-produced soon. Therefore, the company is preparing to pre-sell the second hundred vehicles."

"Then I will contribute to the global environment by pre-ordering three Tesla sports cars."

"Thank you, Logic." Musk continued: "This sports car will definitely satisfy you. It is electric, so it starts very fast..."

"Well, everyone thinks highly of your car." Luo Ji then asked, "Then what is your company's next plan?"

With a smile on his face, Musk said with some pride: "Of course it is mass production of electric cars. As long as mass production is successful, we can get loans from banks, and the company's cash flow will not be so tight. Plus selling sports cars The funds are enough for the company to develop the next generation of mass-market electric vehicles. Then the company will go public."

Luo Ji felt a little regretful. Environmental protection was a major trend in the future, and electric vehicles were of great investment value. However, Tesla's financing had basically ended, so it was still too late for him to get on board.So what about investing in Tesla’s competitors?
Luo Ji rolled his eyes and asked nonchalantly, "Who are your competitors in the electric vehicle industry?"

Musk introduced: "General Motors in the United States, Toyota Honda in Japan, Daimler Group in Germany, etc."

When Luo Ji heard this, he couldn't help but feel dark in his heart. This kind of established car companies had no shortage of funds at all, so they would not let a singer like Luo Ji get involved.

"Then you must be under a lot of pressure. There are so many established companies competing with you."

Musk didn't care, he was very confident: "Although these old car companies have also developed new energy vehicles, they don't have to worry about it at all. These old car companies have the disease of big companies. If they are not forced to It is a dead end because the talents below will not be able to transform the market. The future of new energy vehicles still depends on new energy start-ups."

Luo Ji thought it made sense, and then asked: "So, what other electric vehicle start-ups are there in the world?"

Bill Lee said seriously: "Have you heard of BYD in China? They started out making batteries. After entering the automobile market in 2003, they started researching and developing electric vehicles. The progress is similar to Tesla."

"BYD?" Luo Ji murmured to himself. He felt a sense of familiarity, but he had never heard of this company.

"Boss, we're here." Suddenly a voice interrupted Luo Ji's thinking. It turned out to be Luo Ji's bodyguard.Everyone looked outside and saw that they had arrived at SolarCity's corporate headquarters.

Luo Ji looked behind and saw that the car in which Taylor, Sarah Gore and others were riding had also stopped behind.

The weather in California was quite nice in the morning. Luo Ji stepped out of the car wearing sunglasses. Taylor, Taylor's mother, lawyer Jamie, and two employees from Logic Investment Company all leaned close to him. These were the investments Luo Ji brought today. team.

"This is located in Fremont, California's Bay Area, and the rent is much cheaper than in San Jose." Company founder Lin Deng said.

Luo Ji looked at it, and what caught his eye was a very large warehouse with several low buildings next to it. In the parking lot next to the warehouse, there were several large green trucks parked with SolarCity written on them.

Linden pointed to the roof of the warehouse: "Look at the solar panels on the roof. They absorb the sun and convert it into electricity, which is then stored in the battery pack inside the warehouse. Therefore, all the company's electricity is converted from solar energy."

Linden pointed to the trucks in the parking lot and continued: "Those vehicles are the company's means of transportation to install on customers' rooftops. That low building is where the company's clerical staff work."

The group of people walked into the warehouse, and Linden continued to introduce: "Here are the stored solar panels, purchased from First Solar, and here are the energy storage equipment..."

"The company now has 48 employees, most of whom are field workers helping customers install solar power systems on their roofs,"

After Luo Ji visited SolarCity, he couldn't help but frown.There was nothing like a high-tech industry here. If it weren't for the several trucks parked at the door and the famous people around him who could be found online, Luo Ji would have really thought it was a scam.

Bill Lee, Sarah Gore's fiancé, seemed to notice Luo Ji's doubts and explained: "This is a service-oriented industry. We are like an electric power company. We collect rent from tenants."

This company does not manufacture solar energy-related equipment and belongs to the terminal service industry.This company has two celebrities involved: Bill Lee and Elon Musk.The founder of the company is fairly reliable, the company's operations are basically on track, and it has certain investment value.

Everyone came to the conference room. Luo Ji first signed a confidentiality agreement, and then got the company's equity structure and financing history.

The company's major shareholder, Lyndon Reeve, holds 35% of the shares, another founder, holds 10%, and Elon Musk holds 15%.The company's employees own 5% of the shares.Other investment institutions account for about 35%.

The manager of Logic Investment Company said: "So, your valuation of the company is 6000 million yuan, and you are going to use 10% of the D round of financing for financing, right?"

"Yeah," Lyndon Reeve said.

Luo Ji said nothing and left everything to the company's professionals.He was recommended by Xu Youyu and worked at Goldman Sachs for three years.

He thought for a moment and said: "It has only been three months since your last financing, and now you are starting to raise money again. The funds are being consumed a bit quickly, and the company's valuation has increased six times in just three months. Do you think this Is it reasonable?”

"Isn't this what start-ups are all like? They burn money to capture the market. We currently have a monthly revenue of 100 million US dollars. Although we are losing money, we predict that in two years, the monthly revenue will reach 1000 million US dollars. , the net profit can reach 100 million..."

The two debated for a while, and Lyndon Reeve gave in a little, but Luo Ji's men were still not satisfied.

Luo Ji looked at Linden and others: "Can you go out for a while? I'll have a little discussion with my team."

"OK."

The three shareholders, Lyndon Reeve, Elon Musk, and Bill Lee, all went outside.

Only Luo Ji, Taylor, lawyer Jamie and two employees from Logic Investment Company were left in the conference room.

"Boss, their corporate valuation has been inflated too much, which is very unreasonable. Moreover, this company is burning money too fast. Even if they raise 600 million this time, they will probably only be able to burn through the money until the middle of next year."

"This is Silicon Valley."

Luo Ji touched his chin with his hand and continued: "Silicon Valley start-ups are all like this. A reliable team, an achievable business idea, and then implement it. So what I want to ask is, its business prospects. Can it be achieved?"

"Yes. They plan to expand their customer base and increase their monthly revenue after the D round of financing. Then they can seek loans from Wall Street or commercial banks."

An employee of the investment company continued: "But this business model requires large-scale borrowing to be sustainable. If the capital chain breaks one day, the company will go bankrupt."

“That’s what venture capital is.”

Luo Ji made the final decision: "The shareholders of this company have been successful before, so I am still willing to take a gamble."

"Okay, boss."

Luo Ji looked at Taylor again: "What about you? Do you have any opinions?"

"No, I listen to you."

"In that case, the valuation premium is a premium. Environmental protection is the future trend."

Three hours later, SolarCity’s board members, Elon Musk, Lyndon Reeve, Bill Lee and others sat on one side of the long table.

Round D investors, Luo Ji, Taylor, Taylor’s mother, lawyer Jamie and employees of Luo Ji Investment Company.Everyone sat on the other side of the conference table, looking at the documents in their hands.

Lawyer Jamie took the contract and nodded to Luo Ji and Taylor.Luo Ji took the contract and read it carefully, and Taylor's mother also read a copy of the contract.

The company is valued at US$5000 million, with an investment of US$600 million, occupying 12% of the shares and a board seat. The founding shareholder's share sales restrictions are automatically lifted after the IPO. The company needs to submit regular financial reports to investors.Major personnel transfers...

"no problem."

After Luo Ji read it, he signed the document and handed it to Taylor.Taylor had previously said that she also wanted to contribute to the environmental protection cause, and asked Luo Ji to invest in the new energy industry and bring her with him.So Taylor also invested 100 million this time, accounting for 2% of the shares. She looked at it briefly and signed her name.

"Pleasant to work with."

"Great to work with, Logic, Taylor."

At this moment, there was a knock on the door, and a staff member poked his head in: "Boss, the reporter is here."

Linden looked at Luo Ji and Taylor: "Then let's go out for an interview together."

(End of this chapter)