Social Capital's Chamath Palihapitiya Discusses Tesla (TSLA) at SOHN, Compares it to Apple

May 8, 2017 2:26 PM EDT

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(Updated - May 8, 2017 2:34-2:40 PM EDT)

Social Capital's Chamath Palihapitiya discussed Tesla (Nasdaq: TSLA) at SOHN, comparing to Apple (Nasdaq: AAPL). He pitched Tesla convertible bonds.

  • have 10% of luxury SUV business
  • Horrible for BMX 3 series fell off a cliff
  • Negative comments... TSLA to offer pickups, bought SCTY, building multiple factories, targeting sustainable energy independence
  • capital intensive endeavors
  • TSLA story like AAPL when focus on product and technological framework
  • AAPL was able to create Virtuous Cycle
  • then vertically integrate from that stack
  • AAPL redefined mobility and computing markets
  • established pricing power
  • competitors were losing money to be in same business as aapl
  • TSLA is running similar playbook
  • if you have a Model X, impossible to go back to combustion car
  • consolidating share and differentiation, expanding product scope and vertically integrating...
  • selling autopilot software at nearly 100% margin
  • TSLA has no redefined market yet
  • TSLA story tracking closely to AAPL
  • Model S and Model X like iphone 1 and 2
  • model s and x setting stage for model 3
  • cost basis, operational model different from traditional car OEMs
  • Selling Cars upwards of 7X potential
  • wants to share in TSLA upside
  • pitching TSLA convertible bonds
  • guaranteed to not lose money as long as the company is worth 15B
  • gets 95% of upside if TSLA executes
  • 2022 convertibles are great way to bet on Musk
  • "Elon Musk our Generation's Thomas Edison"

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