If all else fails, Elon Musk can always count on his fan base turning out to back him. With little over two days left before the deadline for remote voting closes, the Tesla CEO and his otherwise media-shy chair, Robyn Denholm, have mounted a last-second campaign blitz aimed at pushing his record pay deal over the finish line.
Their continued lobbying on his behalf all the way down to the wire suggests the risk of a no vote at this Thursday’s annual shareholder meeting is not negligible after news that major institutional investors such as Norway’s $1.7 trillion sovereign wealth fund and CalPERS, the largest public pension scheme in the U.S., both plan to veto his $55 billion pay deal.
“So far, roughly 90% of retail shareholders who have voted have voted in favor of both resolutions,” Musk replied this weekend to Zero Hedge, a publication slanted against Tesla and EVs but pro-Musk thanks to his antiestablishment politics.
Tesla’s retail investor community, estimated to hold just over 40% of its stock, is utterly unlike any other for a publicly traded corporation.
While Apple can boast of similarly high figures, only Tesla’s is highly organized, extremely motivated, and effective at amplifying gains or cushioning falls.
This helps explain why it still trades at growth stock levels of over 50 times next year’s earnings despite sales grinding to a halt and profit margins shrinking.
Individuals such as Farzad Mesbahi, Dave Lee, and Warren Redlich are well-known to small Tesla investors.
They often host each other in a bid to reinforce the message that Musk will create generational wealth while propelling Tesla to become the world’s most valuable company.
Warning to all fund managers, banks and brokers 🌐
— Ale𝕏andra Merz (@TeslaBoomerMama) June 9, 2024
The Tesla retail army, 10,000,000 people worldwide, will take action, when they discover in the next 3 months how you voted your proxies. Most funds and brokerage services are interchangeable.
Do this at your own risk.… pic.twitter.com/xKxo9agr0s
Small shareholders only became a pillar of support after Tesla soared thanks partly to a pandemic-era cocktail of record stimulus and rolling lockdowns.
This same combustible mixture helped spark the get-rich-quick frenzy that launched the YOLO communities around crypto tokens, such as Musk’s favored Dogecoin, and meme stocks like GameStop.
Anger at Musk’s fair-weather friends for sabotaging the company
But the once close-knit group of small shareholders has splintered.
A few are now openly calling out the CEO they feel has been dishonest about the direction of the company, sold his shares near the top, and repeatedly abused his sway with leading social media influencers to keep the faithful placated.
This betrayal by critical Tesla fans has angered people like Yaman Tasdivar, who hosts a recurring Tesla Spaces on X that used to be called “Tesla will triple in 2022” (it fell 65% that year thanks to Musk’s Twitter deal).
Many like him feel like these apostates among Tesla’s faithful have been little more than fair-weather friends of Musk.
I'm taking names.@KoguanLeo@CalPERS@NicolaiTang1@FredericLambert@GerberKawasaki@issgovernance@GlassLewis
— Yaman Tasdivar (@ValueAnalyst1) June 8, 2024
Who else is voting against Elon?
“I’m taking names,” he wrote, starting his list with Singapore-based billionaire Leo Koguan. The latter, Tesla’s third-largest individual investor, has openly called for the board to remove Musk and pledged to vote against his pay package immediately after it was proposed.
Dillon Loomis, host of the Tesla-themed YouTube show Electrified with its 111,000 subscribers, warned these traitors would not be welcome back into the fold once Musk delivers on his promise to grow Tesla into the most valuable company in the world.
“You don’t get to try to sabotage one of the most important companies on the planet and then celebrate with us when the payoff for patience and trusting the man behind Tesla…arrives,” he posted last week.
Even the devoted have their price, however.
Retail shareholder Redlich, best known for saying he would lay down his life for Musk, admitted that he sold a fifth of his personal holdings at $175 a share last month.
The lawyer, by training, blamed the move on the risk that Musk would resign in the event of a no vote.