Tesla’s biggest investor: it’s a family business masquerading as a public company
Leo KoGuan has invested more money into Tesla than anyone in the world, yet he can’t even get his concerns heard by the company’s board. The shareholder is frustrated with some of the CEO’s recent controversies, but with the board MIA, there’s no way to reign him in.
We first reported on KoGuan in 2021 when the little-known investor became the third largest individual shareholder in Tesla behind Elon Musk and Larry Ellison.
The Indonesian-born Chinese American businessman is better known for founding SHI International Corp, a large private IT company that made him a billionaire. He is also involved in academia and philanthropy.
KoGuan has previously described himself as an “Elon fanboy” (the featured image above is him and Musk) and believes in Tesla’s mission to accelerate the world’s transition to sustainable energy. He has been willing to put his money on it and by 2022, he had invested more money in Tesla than Musk himself.
Of course, Musk invested early in Tesla, and therefore, he holds a bigger share with a smaller investment.
KoGuan is the third largest individual shareholder in the company, but you could argue that he is the biggest Tesla investor as he invested more than anyone in the company: $3.5 billion.
The investor is active on X. On the platform, he has been mostly supportive of Musk and Tesla, but like many other shareholders, he started to be more critical since Musk sold about $40 billion worth of Tesla shares to buy Twitter.
Interestingly, KoGuan doesn’t really comment on Musk’s most controversial statements, but he is concerned about his sales of Tesla stocks, how he did them, and what it means for his commitment to Tesla.
More recently, he also made fun of Musk’s request to have 25% voting power of Tesla:
KoGuan likes to call Tesla shareholders Elon’s “adopted children” and more recently, his “abused adopted children”. “Dear leader” is a reference to Kim Jong-il, the former supreme leader of North Korea.
I asked him yesterday if he has received any feedback from Tesla’s board or investor relations regarding his concerns, and this was his response:
“No response. Nil. Tesla is a family business masquerading as a public company to benefit only one person with his few friends and family. “
KoGuan is particularly concerned about the lack of oversight on how Musk dumped his Tesla shares on the open market. He told Electrek:
Why SEC allowed a CEO of a public company to dump his stocks worth more than $40 billion naked in the market to push the price down while predicting a market crash? He is now negative investing in Tesla or about minus $39 billion. He could have asked Goldman Sachs and Morgan Staley to sell those in block sales to fund managements that could keep those stocks, not dumping them in the market? Tesla’s shareholders are his abused adopted kids whom he could abuse with impunity.
It is fairly common amongst large shareholders and company insiders to set up a plan to sell large amounts of stocks in order to minimize the impact on the market.
The investor is bringing up legitimate questions and even though he is one of the largest shareholders, he can’t be heard by the board.
The board of directors of a public company is tasked with setting strategy, overseeing management, and protecting the interests of shareholders and stakeholders. It is technically overseeing the CEO, Elon Musk, who is, in turn, in charge of the entire management and operation of the company.
For large companies like Tesla, it is preferred that the board be independent of the management, but in the case of Tesla, the board has long been seen as being under Musk’s control. As Tesla grew, shareholders put pressure to hire independent board members, which Tesla eventually did.
But the board is still widely believed to be too close to Musk. Musk’s brother Kimbal, as well as longtime friends Ira Ehrenpreis, James Murdoch, and JB Straubel, are all on the board.
The board has also been granted record high compensations and even had to return $735 million in stock and cash as part of the settlement of a lawsuit brought on by shareholders over what they believed to be overcompensation.
Electrek’s Take
“Tesla is a family business masquerading as a public company.” Those are strong words coming from the biggest investors in the company. And it’s hard to argue against those words.
Do you know of any other major public companies like Tesla that don’t even have a public relations department? Elon is basically the sole mouthpiece for the company.
Tesla has 140,000 employees. It’s worth more than $600 billion. And yet, it appears to be completely under Elon’s thumb, for better or worse. It might have been for the better early on. No one believed in the vision more than Elon. His unwavering belief in himself and the mission helped break through doubts, but now Tesla is a different company. It’s not the underdog fighting for the impossible anymore. It made the impossible happen. EVs are now mainstream. Energy storage is now a critical part of the renewable energy infrastructure.
Now, it is about properly managing the immense scaling of that business, which is badly needed to support the world’s transition to renewable energy. It’s about a wide appeal. It’s not about being decisive. Tesla might need strong governance more than it needs a maverick at this point.
As for the board, it remains silent and uncommunicative to shareholders despite serious conflicts of interest and even possibly a breach of fiduciary duties of its CEO.
In 2018, Elon left OpenAi officially to “avoid a conflict of interest as Tesla is increasingly working on artificial intelligence“.
Yet, now 6 years later, Elon poaches Tesla employees to work on X and his new AI startup xAI, and openly talks about not building AI products at Tesla if he doesn’t get 25% control over the company, but the board doesn’t do anything.
Even one of the biggest shareholders and supporters of the company, Leo KoGuan, can’t get his concerns heard by the board. What hope do smaller investors like us have? It’s shameful, really.
The fact that Elon has the guts to ask for more control over Tesla when it’s clear that he has complete control over the company right now is absolutely ridiculous.
Of course, he only wants control of the votes and “not more economics”, as he said, and it’s just a coincidence that there’s no way to give him more control over the votes without giving him more shares, which he wasted on an overpriced Twitter.
There wouldn’t be a Tesla without Musk. It would have died on several occasions without him. But Tesla also would have died without its strong base of retail investors. They need to be heard. The board needs to do better.
I still have a little bit of hope though. I think the board could find the courage to confront Musk and, at the very least, have him agree to a framework that keeps Tesla safe from his clear conflicts of interest. If even that can’t be achieved, it might be time for a new full-time CEO at Tesla.
What do you think? Let us know in the comment section below.
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China’s EV automakers have surged ahead of the competition in global EV sales, and a new report shows just how far ahead they are.
The International Council on Clean Transportation (ICCT) just dropped its third annual Global Automaker Rating, showing that Chinese carmakers dominate the zero-emission vehicle (ZEV) space. China now accounts for over 11 million EVs sold annually – over half of global EV sales.
Its massive domestic market has helped Chinese automakers build serious momentum. They’ve scaled up, improved tech, and are now setting the pace globally. Companies like Geely and SAIC have already hit 50% EV sales share, meeting their 2025 targets a full year early. In fact, Chinese automakers took the top five spots for ZEV class coverage, and five out of the top six for EV sales share.
Meanwhile, automakers in the US and Europe are trying to catch up. But they’re facing a dual challenge of falling behind on tech while navigating shaky regulatory environments.
The report also confirmed a big milestone: In 2024, BYD officially surpassed Tesla in global battery electric vehicle (BEV) sales for the first time. BYD’s BEV sales jumped 25%, and its combined BEV and plug-in hybrid sales climbed an impressive 47% year-over-year. Still, both BYD and Tesla remain in the “Leaders” category.
Automakers boosted energy efficiency, charging speed, and driving range thanks to newer, high-performance models.
“Our assessment revealed widespread improvement in BEV technology performance across the industry,” said Zifei Yang, ICCT’s global passenger vehicle lead. “GM and Honda made significant advancements by introducing high-performance models to their previously limited offerings, while companies like Geely, Chang’an, and Chery improved substantially with new high-performance EV lines.”
India’s Tata Motors also hit a turning point. For the first time, it graduated from ICCT’s “laggard” group to “transitioner,” thanks to new EVs and big moves on battery recycling and repurposing. While Japanese and South Korean automakers are still lagging behind, Honda and Nissan are inching forward. Honda launched its first US BEV, and Nissan finally clarified its ZEV targets.
One newer addition to this year’s report: a green steel metric. Since steel is the second-largest source of emissions in vehicle manufacturing (after batteries), ICCT now tracks which automakers are cutting emissions in the supply chain. European brands like Mercedes-Benz, BMW, and VW earned high marks for sourcing renewable-powered green steel.
ICCT’s CEO, Drew Kodjak, summed it up: “The rapid evolution of the EV market in China has created technological and manufacturing advantages for companies there. For the wider global auto industry, this is no longer just about meeting future goals – it’s about remaining competitive today in a market that’s charging up.”
The full Global Automaker Rating, covering 21 major automakers, is now live on ICCT’s website.
Read more: EV prices dipped in May – and Tesla Model Y led the slide
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Environment
Bloomberg just released the most embarrassing report about Tesla, Waymo, and self-driving
Bloomberg has just released an embarrassingly bad report about the self-driving space, in which it claimed Tesla has an advantage over Waymo by misrepresenting data.
There are currently many eyes on Tesla’s imminent launch of its “robotaxi” service in Austin, Texas.
We have just published a new report today to highlight how the launch is a game of smoke and mirrors, meant to reframe the optics of Tesla’s self-driving effort following years of broken promises.
At the same time, Bloomberg Intelligence released its own report, claiming that Tesla is ahead in self-driving technology, but the firm misrepresented data to support its claim.
The report compares Tesla’s and Waymo’s self-driving efforts, going so far as to claim that “Tesla is closer to vehicle autonomy than peers.”
Here are the two main charts that Bloomberg circulated from the report:
The problem is that the report is misleading by comparing completely different data.
Steve Man, the Bloomberg Intelligence analyst behind the report, based his report on Tesla’s own quarterly misleading “Autopilot Safety Report.”
The report is widely considered to be unserious for several main reasons:
- Tesla bundles all miles from its vehicles using Autopilot and FSD technology, which are considered level 2 ADAS systems that require driver attention at all times. Drivers consistently correct the systems to avoid accidents.
- Tesla Autopilot, which is standard on all Tesla vehicles, is primarily used on highways, where accidents occur at a significantly lower rate per mile compared to city driving.
- Tesla only counts events that deploy an airbag or a seat-belt pretensioner. Fender-benders, curb strikes, and many ADAS incidents never appear, keeping crash counts artificially low.
- Finally, Tesla’s handpicked data is compared to NHTSA’s much broader statistics that include all collision events, including minor fender benders.
All these facts combined render the comparison between Tesla’s accident rate using “Autopilot technology” and NHTSA’s US average completely useless.
Yet, Bloomberg decided not only to use it but also to compare it to Waymo’s data to claim that “Tesla is 10 times safer”:
The problem with this is similar to the comparison with the US average, as the Waymo data includes all police-reported incidents, which is a much wider net than Tesla’s data, in addition to the previously mentioned issues.
To highlight how big a potential discrepancy there is in the data, NHTSA underscored in a report last year how Tesla is not aware of many crashes involving Autopilot and that only 18% of police-reported crashes involve airbag deployment:
Gaps in Tesla’s telematic data create uncertainty regarding the actual rate at which vehicles operating with Autopilot engaged are involved in crashes. Tesla is not aware of every crash involving Autopilot even for severe crashes because of gaps in telematic reporting. Tesla receives telematic data from its vehicles, when appropriate cellular connectivity exists and the antenna is not damaged during a crash, that support both crash notification and aggregation of fleet vehicle mileage. Tesla largely receives data for crashes only with pyrotechnic deployment, which are a minority of police reported crashes. A review of NHTSA’s 2021 FARS and Crash Report Sampling System (CRSS) finds that only 18 percent of police-reported crashes include airbag deployments.
Knowing full well the comparison is not fair and completely misrepresents the situation, the usual Tesla stock pumpers on X widely shared Bloomberg’s misleading report positively, and even CEO Elon Musk shared the misleading data:
Electrek’s Take
This is embarrassing for Bloomberg. It’s such a blatant error and misrepresentation that it is suspicious. They should issue a correction right away.
Tesla fanboys are now pushing this to try to prove that Tesla’s robotaxi is safe to launch amid Tesla doing everything it can to hide its self-driving crash data ahead of the launch. This is a dangerous report from Bloomberg.
Additionally, it’s not just the primary claim regarding the accident rate that is misleading. The report also contains several glaring errors.
In this chart, Bloomberg claims that Tesla is at “3 billion miles of data collected since launched”:
It looks like they simply use Tesla’s “cumulative miles driven with FSD (Supervised)”, which includes driver supervision, and the driver remains responsible for correcting FSD at all times.
In comparison, they talk about 22 million miles for Waymo. It looks like Bloomberg only used Waymo’s rider-only mileage in San Francisco, which is currently at 22 million miles, but when accounting all markets, Waymo is currently at more than 71 million miles:
It’s not clear why they would only use mileage in San Francisco for Waymo when they used Tesla’s global customer FSD mileage for Tesla.
Again, these are also “rider-only” miles, which means that there are only people riding inside the Waymo vehicles, compared to Tesla’s mileage being completely supervised by customer-drivers at all times.
We simply don’t know how many “rider-only” miles Tesla has, since it only started with one or two cars in Austin over the last few weeks. It is likely to have no more than a few hundred or a few thousand miles.
Regardless, it’s completely nonsensical to claim that Tesla is “ahead of its peers” in self-driving, especially Waymo, based on this report.
Tesla is currently only trying to launch something that Waymo has been doing for years.
The other argument the report attempts to make is that Tesla’s “self-driving” vehicles are approximately 7 times cheaper than Waymo’s.
Again, the problem is that Tesla’s vehicles are not self-driving. Tesla has yet to prove that, and that’s why it is using “plenty of teleoperation” in this launch in Austin. Mapping, optimizing for geo-fenced area, and teleoperations are the real limiting factors here. Not the cost of the vehicles.
Suppose Tesla has anything less than a 100-to-1 vehicle-to-teleoperator ratio. In that case, its system is not profitably scalable and I wouldn’t be surprised if it has a 1-to-1 ratio for the foreseeable future – at least on its current hardware.
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