Tesla wows on first day of trading, but will it last?
I’m happy for Tesla Motors. The company’s initial public offering Tuesday was, despite the many doubters out there, a stunning success. The company closed its first day of trading at $23.89, which is roughly 40 per cent higher than its offering price. The doubters, quite understandably, point to the fact that Tesla is not profitable and has a long road ahead before it stops bleeding red ink. But there’s a sense of excitement around Tesla that bodes well for the clean technology sector generally. Yes, Virginia, there is a venture capital exit strategy for cleantech companies — even electric car companies. I have no doubt we’ll see Tesla’s stock fall below its $17 offering price, and that will likely happen in the next week or two. Still, I think there’s a solid group of investors out there that want to see Tesla succeed, believe it will succeed, and are patient enough to wait for that day. Personally, I think it will end up being scooped up by a major automotive OEM when the stock dips to bargain levels. Whatever the outcome, Tesla has a strong brand backed by strong engineering and ballsy vision, and while investors will likely be in the back seat for years asking, “Are we there yet?”, this company deserves a pat on the back and an “A” for effort and inspiration.