
Tesla’s Pay Deal to Keep Elon Musk: All or Nothing - endswapper
https://www.nytimes.com/2018/01/23/business/dealbook/tesla-elon-musk-pay.html
======
afinlayson
He really needs to find a COO. He needs his Tim Cook. This is a good way to
show shareholders he's all in, but he's not a genius at Operations, he needs
to find someone who is.

~~~
loceng
He'll learn if that's a role he's meant to evolve into.

~~~
nikofeyn
what does that mean? haven't both tesla and spaceX historically struggled with
operations under his leadership? don't you think he'd have learned by now if
he could?

~~~
loceng
I think you could only honestly say that Tesla and SpaceX have struggled with
operations under his leadership if you're ignoring the level of success that
both companies reached so far. He's busy, he's admitted and aware of switching
costs of leading two companies - there is value to this though of course too;
imagine if Elon only focused on Tesla and not SpaceX - where would we be as a
society, where would Elon be position wise? He's following his intuition and
his heart which he clearly wears on his sleeves. He's a wonderful role model,
and we should support everyone the same way he's gained support from others;
yes, he was entrepreneurial from a young age, and "got lucky" by knowing to
move to the place that dreams are more easily funded. We fail as a society
supporting everyone to reach their dreams to the same level, part of the
reason are systems in place that are designed to control and funnel everyone
into an economically efficient model - however ignoring the qualitative impact
- it's why the idea of flexible learning, learning online at your own pace,
etc are going to become the future.

------
sytelus
Fun bit: Mr. Musk does not take a salary, although under California State law,
Tesla is required to pay him at least minimum wage. Tesla sends him checks
that pay him a little more than $37,000 annually.

A first minimum wage CEO of a public company?

~~~
secabeen
No, there are lots of CEOs that only take $1 salary, in states where they can
be exempt from minimum wage.

~~~
Isamu
Steve Job's salary was $1, this was widely reported.

~~~
craftyguy
Bragging about having a $1 salary is basically telling your employees that you
make so much more in other benefits that you can choose to forego the one
thing (salary) that makes up the vast majority of their total comp.

~~~
throwawayfinal
In Steve Jobs' case, it was meant to instill confidence that he was in it for
the long term - at the time, Apple was on death's doorstep.

He also had enough cash in the bank prior to re-joining that he didn't really
need the money.

------
voidmain
This plan is roughly isomorphic to option compensation. It has a serious
incentive compatibility problem: the value of the options increases with
volatility/risk, so incentivizes unnecessary, and even negative expectation,
risk taking. Maybe Musk has a big enough stake in Tesla to mitigate this
effect, but it's definitely not a risk free approach for minority
shareholders.

~~~
Robotbeat
It's also linked to operational milestones, so market cap has to be met with
actual progress. That's much better than market cap alone.

