- The billionaire businessman Mark Cuban has offered up some advice for the embattled Tesla CEO Elon Musk.
- Cuban told Business Insider that Musk should view Tesla short-sellers as “his friends.”
- “It creates demand for his stock and that’s always a good thing,” Cuban said.
The billionaire businessman Mark Cuban has reacted to the series of controversies surrounding Tesla CEO Elon Musk while also offering up a bit of advice for his fellow billionaire.
In an email exchange with Business Insider on Thursday, Cuban, the owner of the NBA’s Dallas Mavericks and a star of ABC’s “Shark Tank,” called Musk “a unique entrepreneur.”
“When you invest in one of his companies you are investing in him,” Cuban said. “He isn’t going to be traditional and it’s worked for him so far.”
As for any advice he would offer, Cuban said he would tell Musk the short-sellers “are his friends.”
“It creates demand for his stock and that’s always a good thing,” Cuban added.
Short-selling involves borrowing shares and selling them with the hope that they could later be bought back at a lower price, allowing the seller to profit from the difference. Short-sellers, who are therefore betting against companies, find themselves on the short end of the stick if the share price increases.
Musk has openly taunted Tesla short-sellers, of whom there are many, in recent months, even tweeting, “Short shorts coming soon to Tesla merch.”
In a New York Times interview published Thursday, Musk blamed short-sellers for many of his headaches, saying they were “desperately pushing a narrative that will possibly result in Tesla’s destruction,” adding that short-sellers were “not dumb guys, but they’re not supersmart.”
“They’re OK,” he said. “They’re smartish.”
In his much-maligned “funding secured” tweet last week, Musk wrote he was “considering taking Tesla private at $US420.”
Musk also said via Twitter that shareholders could either “sell at 420 or hold shares & go private.”
Shares of Tesla, one of the most shorted stocks on the S&P 500, jumped in the aftermath of Musk’s tweet.
The company is under scrutiny from the Securities and Exchange Commission, which is believed to be investigating Musk’s tweet about taking the company private. Separately, two former Tesla employees have filed whistleblower complaints with the agency. One of them, Karl Hansen,accused Musk of authorizing spying on his employees and alleged that the company did not tell federal authorities about information Hansen provided regarding allegations of drug trafficking at Tesla’s Gigafactory in Nevada. Tesla did not respond to multiple requests for comments about these claims.
Musk’s tweet about taking Tesla private wasn’t his only recent Twitter controversy. The billionaire also found himself in hot water after making a baseless claim that one of the divers who participated in this summer’s Thai cave rescue was a pedophile, and Musk became the subject of intense criticism for his proposal to start a website for the public to rate the trustworthiness of certain journalists.
Cuban told Business Insider he did not own any Tesla shares and never had. In an interview with CNBC earlier this week, Cuban said he owned two Tesla vehicles.
In that CNBC interview, Cuban likened Musk to the late Apple CEO Steve Jobs and Amazon CEO Jeff Bezos.
“Everyone complained at one point or another about Steve. He got fired,” Cuban said. “You look at Amazon. Everybody complained about Jeff. ‘He’s not trying to make any money. He’s not giving guidance. He’s not doing this, he’s not doing that.'”
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.