Shareholder Galileo Russell Bullish on Tesla, Hopes Musk Doesn’t Sell

Will Elon Musk sell his disruptive automotive startup at some point? Galileo Russell, founder and CEO of HyperChange, hopes he won’t.

Following media reports that Volkswagen is interested in buying a stake in Tesla, TSLA shares were mixed. Although Volkswagen dismissed the media reports, the brouhaha raised questions about whether anyone could or should buy Elon Musk's company.HyperChange's Galileo Russell thinks there are many companies that would like to get their hands on Tesla's technology, but that acquiring the company would be prohibitively expensive. In an interview with Yahoo Finance's On the Move, Russell argued that Tesla is too big for any automotive company unless the deal were "a merger of equals."

He also expressed hope that Musk wouldn’t take such a step. “I don't want this company to sell,” said Russell, who is also a Tesla shareholder. “I don't think Elon Musk wants this company to sell at this price, because it's so, so undervalued.”

Asked who could buy Tesla, Russell noted the disruptive potential of autonomous vehicle software and said it would be a smart move for companies outside the auto sector. Tech giants like Apple, Google, and Amazon are perfect candidates, he said, because Tesla cars are actually “smartphones on wheels.” “This is way more about software than it is about building a car,” Russell said. “And those are the core competencies that these tech companies have, much better than auto companies.”

Tesla shares have slid more than 30% this year, partly due to Musk's questionable tweets and the departure of a huge number of experts. In January 2019 alone, seven percent of Tesla’s workforce left the company.

Still, Russell believes that Musk's controversial behavior is a big reason the greatest talents in software engineering have been attracted to build Tesla's batteries. He noted a recent study showing that engineering students are most interested in working at SpaceX and Tesla. According to Russell, Tesla's talent factor is a huge competitive advantage.

Russell believes that despite all the criticism, Tesla will achieve tremendous growth. As a reason why Tesla is the biggest investment in his portfolio, Russell points out that Tesla delivered 2,000 Model S cars a year, and plans to deliver between 360,000 and 400,000 cars in 2019.

“Autonomy is actually in the bag for Tesla as well. That narrative will play out over the next 12 months and will totally change how transportation works in cities. That is a massive opportunity that will let this company potentially get 10, 20, 30 times bigger. That is the exciting next phase of the company that I’m betting on,” Russell concluded.