Elon Musk's TRILLIONAIRE Pay Package

Investment Strategy

🚀 Q: How should investors approach Tesla stock given its volatility?
A: Tesla stock is likely to experience 40-60% drops every 12 months, making it a high-risk investment for short-term traders but potentially lucrative for long-term shareholders who can withstand the volatility.

💼 Q: What are the key market cap targets in Elon Musk's new pay package?
A: The package includes market cap targets of $2 trillion, $3.5 trillion, $5 trillion, $7.5 trillion, and $8.5 trillion over a 10-year period, tied to specific operational milestones.

Tesla's Future Plans

🤖 Q: What are Tesla's ambitious operational milestones?
A: Tesla aims to deliver 20 million vehicles, produce 1 million Optimus robots, deploy 1 million commercial robo taxis, and achieve 10 million active FSD subscriptions.

🚕 Q: How will Tesla's robo taxi network impact transportation?
A: The network is expected to radically change transportation markets, potentially displacing semi drivers and significantly lowering costs for working-class people.

Elon Musk's Compensation

💰 Q: What is the potential value of Elon Musk's new pay package?
A: If Tesla reaches an $8.5 trillion market cap, Musk's restricted stock pay package could be worth $1 trillion, potentially making him the world's first trillionaire when combined with his other assets.

🔒 Q: How does the pay package incentivize Musk to stay with Tesla?
A: Musk must remain at Tesla for at least 5 years after the milestones vest to avoid selling shares and paying taxes, ensuring his long-term commitment to the company.

Tesla's Growth Potential

📈 Q: What is the growth rate required for Tesla to reach its highest market cap target?
A: To achieve the top market cap target, Tesla would need to maintain a 52.7% CAGR over 5 years, an ambitious but potentially achievable goal given the company's growth prospects.

🌐 Q: What is the estimated value of Tesla's Optimus robot business?
A: The Optimus robot business alone is projected to potentially be worth $20-30 trillion in the long term, contributing significantly to Tesla's overall value.

Societal Impact

🌍 Q: How does Musk's vision for Tesla contribute to societal benefits?
A: Musk's 10-year vision includes advancing sustainable abundance, developing humanoid robots, and perfecting autonomous cars, which could collectively create over $7 trillion in value and improve labor markets.

👥 Q: How will Tesla's innovations affect the workforce?
A: While potentially displacing some jobs like semi drivers, Tesla's technologies are expected to improve labor markets overall and provide societal benefits through increased automation and efficiency.

Leadership and Governance

🏆 Q: Why did Tesla's board approve this ambitious pay package for Musk?
A: The board's decision is based on Musk's unique qualifications, visionary leadership, and proven track record of delivering on ambitious plans, which are deemed critical for Tesla's transition from EVs to AI and robotics.

🔑 Q: How will Musk's ownership stake in Tesla change if he meets all milestones?
A: Musk's ownership stake will increase by 12% upon meeting all operational milestones, giving him greater control over the company and its direction in AI development.

Elon Musk's Pay Package

🚀 Musk's compensation plan includes a base package of delivering 20 million Teslas and reaching a $2 trillion market cap, with additional milestones for 1 million Optimus, 1 million robo taxis, 10 million FSD subscriptions, and $8 trillion in profitability.

💰 The pay package is worth $1 trillion if Tesla reaches $8-8.5 trillion in market cap, potentially making Musk the world's first trillionaire with a $2 trillion net worth.

⏳ The package features a 10-year vesting period and a 5-year lockup period to ensure Musk's long-term commitment to Tesla.

Tesla's Future Vision

🤖 Tesla's 10-year vision includes a robo taxi network that could multiply overnight in value and "Optimus abundance for all" where everyone has their own robot.

🚗 The company's robo taxi network aims to radically drop transportation costs from $2 to $1-$1.50 per mile, benefiting working-class people and lowering vehicle costs.

🌍 Tesla's "sustainable abundance" master plan, including humanoid robots, autonomous cars, and clean energy, will significantly impact labor and transportation markets.

Investment Strategies

📈 Tesla's exponential growth is expected to lead to very volatile stock prices, with potential 40-60% drops every 12 months.

🔄 A cover call strategy using a margin of safety was profitable in 2020 despite the stock multiplying by 8x or growing by 700%.

Market Cap Targets

📊 Musk's pay package includes 15 market cap targets ranging from $2 trillion to $9 trillion, with increments of $0.5 trillion.

Operational Milestones

🎯 The operational milestones are cumulative, not annual, and include delivering 20 million Teslas, 1 million Optimus, 1 million robo taxis, and 10 million FSD subscriptions.

Challenges and Impact

⚠️ Tesla's vision will not be a "smooth ride", with many people potentially displaced and upset by the radical changes in labor and transportation markets.

💹 The cost of vehicles in the US has "outrageously gone from $24,000 to $48,000" in less than a decade, highlighting the need for more affordable transportation solutions.

• 00:00 💸 Elon Musk's pay package from Tesla could be worth tens of billions, with performance milestones tied to shareholder interests.
  • Elon Musk's pay package has been revealed in a Tesla proxy filing, and it's expected to be a massive award that will generate significant media attention.
  • Elon Musk's 2018 pay package from Tesla was highly unusual, with performance milestones that seemed impossible to achieve, yet potentially worth tens of billions of dollars.
  • Elon Musk's pay package was designed with an incentive structure aligned with shareholder interests, where he would get nothing if performance milestones weren't met.
• 03:37 💸 Elon Musk's pay package requires Tesla to reach market cap milestones ($2-8.5 trillion) and operational targets (20M vehicles, 1M robo taxis) for him to receive additional shares.
  • The speaker's pay package includes market cap targets ranging from $2 trillion to $8.5 trillion over 10 years.
  • To reach a market cap of $8.5 trillion, Tesla would need a 10-year growth rate of 23.6%, but could potentially reach $20-30 trillion or more if Optimus is successful.
  • Tesla needs to cumulatively deliver 20 million vehicles, a target it is already over a quarter of the way toward achieving, to meet the base package condition.
  • Elon Musk's pay package includes a base package tied to Tesla's market cap and operational milestones, such as a $2 trillion market cap and 20 million Teslas delivered.
  • Elon Musk's pay package requires Tesla to reach certain market cap and operational milestones, such as a $3 trillion market cap and 1 million robo taxis in operation, before he receives additional shares.
• 09:10 💸 Elon Musk's pay package could reach $8 trillion if Tesla's AI-enabled products, like Optimus robot and Full Self-Driving technology, drive rapid earnings growth.
  • If Tesla's Optimus robot is commercially successful, even being a third player in the market would still allow for upside from the current share price.
  • A million robo-taxis in operation would generate significant revenue, with 10 million active FSD subscriptions potentially earning Tesla $1 billion monthly.
  • Elon Musk's pay package may create an incentive to keep FSD subscription prices lower than optimal for profit maximization in order to reach subscriber targets.
  • Elon Musk's potential pay package could reach $8 trillion if his company's earnings grow rapidly, driven by AI-enabled products like humanoid bots and Full Self-Driving (FSD) technology.
• 13:50 💸 Elon Musk's huge pay package tied to Tesla's success, including $2 trillion market cap, is deserved and incentivizes long-term performance.
  • The speaker believes Elon Musk deserves his 2018 pay package, which was previously taken away, and thinks he should also receive a new package with huge potential upside.
  • Elon Musk's pay package gives him 12% ownership, with conditions that incentivize long-term Tesla performance, including a 5-year hold on vested shares and eventual taxes that require some stock sales.
  • The speaker generally supports Elon Musk's pay package, despite some minor concerns, as it ties his compensation to the company's success, such as reaching a $2 trillion market cap.
  • Elon Musk is uniquely qualified to lead Tesla's transition to AI and robotics, whereas Tim Cook, despite creating shareholder value, is not a visionary and his innovative contributions to Apple are questionable.
• 18:13 💸 Elon Musk's new pay package could make him a trillionaire, with investors seeing it as a worthwhile trade-off for potential 8x returns, amidst discussions of innovation, sustainability, and income inequality.
  • Elon Musk's ideal replacement should balance operational skills with a culture of innovation and excellence, and may require someone with a strong, possibly demanding personality.
  • The speaker appears to be introducing a discussion about Elon Musk by mentioning a person who worked on chip design for Tesla and Apple, drawing a comparison to Steve Jobs.
  • Elon Musk's new pay package is restricted stock, giving him voting power earlier, but requiring him to hold shares for at least five years once vested, with earned shares vanishing if he leaves Tesla before vesting.
  • Elon Musk's pay package is a transfer of stock, not cash, with milestones that may never be met, allowing him to maintain voting power.
  • Investors may consider 12% dilution a worthwhile trade-off for an 8x return on their stock, making Elon Musk's pay package a "no-brainer".
  • Elon Musk's potential trillionaire status and Tesla's plans for sustainable abundance, including autonomous cars and humanoid robots, may exacerbate income inequality and class tensions, but could also radically reduce transportation costs and benefit working-class people.
• 26:49 💸 Elon Musk's potential trillion-dollar pay package is justified by his potential to create over $6 trillion in value for Tesla, with predictions of a $16 trillion market cap.
  • Elon Musk's potential trillion-dollar pay package is justified as he would have created over $7 trillion in value, with a net gain of $6 trillion, and pay $400 billion in taxes.
  • Elon Musk's pay package could net him $600 billion after taxes, but may create over $6 trillion in value, with some analysts predicting Tesla's market cap could reach $16 trillion.
  • Business is a meritocracy where rewards and value accrue to those who create the most value.
  • Elon Musk's pay package, worth roughly $1 trillion in revenue, would be impossible in China and has significant GDP-impacting implications for the US economy.
  • Lowering costs through innovations like those of Elon Musk can remove hundreds of billions of dollars of low-value economic activity, deliver better products at lower costs, and increase margins.
  • Tesla's valuation could potentially reach $16 trillion if it is valued at a 40 multiple of earnings, similar to Nvidia.
• 34:42 💸 Elon Musk's pay package sets high targets for Tesla's valuation, sparking investor eagerness for quicker results amidst warnings of potential volatility.
  • Elon Musk may be more bullish and specific about Tesla's future projects, including robo taxis and Optimus robots, after his pay package, but investors are eager for quicker results.
  • Elon Musk's pay package sets a high target for Tesla's valuation, effectively 8 times higher than the current share price, which may change as shares outstanding change.
  • Elon Musk's pay package could reach $2,800 per share in 10 years, but investors should be cautious with margin and options trading to avoid significant losses.
  • Investing in exponentially growing companies like Tesla can be volatile, with periodic large drops in share price, requiring careful management of positions like margin calls.
  • Investors can take advantage of periodic market declines by using strategies like sitting through declines, margin of safety, and cover calls to profit, as seen in the 2020 market where cover calls were surprisingly profitable despite initial skepticism.
  • The conversation appears to be wrapping up after 42 minutes, with a humorous reference to not being able to go 69 seconds over.
• 42:15 👋 The video ends with hosts Matt Smith and Bradford Ferguson bidding farewell.

WatchUrl: https://www.youtube.com/watch?v=pxgAYtF30IY