Quote:
Originally Posted by peter12
Well, maybe. But if his ideas are so great, why can't he sell them to the market on their own merit. If things can't scale, and make money, well, then they aren't really all that much good.
As for being a decent futurist, Pirrong makes a compelling case that Musk has exercised his market power before to artificially increase the price of his stock to raise capital.
http://streetwiseprofessor.com/?p=7294 |
Because he's going for the most efficient way by leveraging every dollar he can, whether it's the government, tax incentives, private equity, etc. to get it off the ground and avoid the snail's pace of regular industry cycles.
Innovative technology never scales out of the gate. That's why tech always starts out high priced until the R&D, tooling, etc. is paid off and development and inefficiencies come in to trickle it down to the masses. He's just reversing this and subsidizing the tech so that the masses can afford it to build that hype, to build that base, and create the appetite for a completely new segment which will hopefully help fund those economies of scale down the line.