Elon Musk open-sourced all of Tesla's patents for other car companies to copy.
Wall Street called it 'dumb' and thought Tesla will be crushed.
Elon was right. Everyone was wrong.
Every entrepreneur needs to understand why he did it and why it worked:🧵
Wall Street called it 'dumb' and thought Tesla will be crushed.
Elon was right. Everyone was wrong.
Every entrepreneur needs to understand why he did it and why it worked:🧵
Look at this graph 👇
In 2014, EVs made up less than 1% of car sales in the US.
But Elon realized that his competition wasn't other car companies.
It was the internal combustion engine itself.
In 2014, EVs made up less than 1% of car sales in the US.
But Elon realized that his competition wasn't other car companies.
It was the internal combustion engine itself.
To win, Tesla needed to change the entire automotive landscape.
Elon's strategy was simple: Make it easier for everyone to build electric cars.
By doing this, Tesla removed barriers for other companies to enter the EV market.
This wasn't just altruism. It was a brilliant plan.
Elon's strategy was simple: Make it easier for everyone to build electric cars.
By doing this, Tesla removed barriers for other companies to enter the EV market.
This wasn't just altruism. It was a brilliant plan.
1. Elon understood the Positive-Sum game
In a Positive-Sum game, all participants can benefit, creating value that didn't previously exist.
By open-sourcing its patents, Tesla encouraged more companies to develop EVs.
In a Positive-Sum game, all participants can benefit, creating value that didn't previously exist.
By open-sourcing its patents, Tesla encouraged more companies to develop EVs.
This didn’t just benefit those companies.
It created a larger, more vibrant EV market.
More EVs meant more charging stations, better infrastructure, and greater public interest.
Ultimately, Tesla benefits from a growing EV ecosystem.
It created a larger, more vibrant EV market.
More EVs meant more charging stations, better infrastructure, and greater public interest.
Ultimately, Tesla benefits from a growing EV ecosystem.
2. It positioned Tesla as an industry leader
By freely sharing patents, Tesla took the position of industry benefactor.
This bold move garnered massive media attention and public goodwill.
Tesla wasn't just selling cars. It was selling a better vision of the future.
By freely sharing patents, Tesla took the position of industry benefactor.
This bold move garnered massive media attention and public goodwill.
Tesla wasn't just selling cars. It was selling a better vision of the future.
3. Finally, it created a competitive scenario.
As more companies entered the EV market, they inadvertently promoted the concept of electric cars.
This expanded the overall market, with Tesla leading the charge.
Sometimes, a rising tide really does lift all boats (or cars ;)
As more companies entered the EV market, they inadvertently promoted the concept of electric cars.
This expanded the overall market, with Tesla leading the charge.
Sometimes, a rising tide really does lift all boats (or cars ;)
This strategy mirrors successful tech industry collaborations:
Remember when Bill Gates saved Apple from bankruptcy?
Their competition pushed both to innovate faster.
Result? Both companies thrived, and consumers got better products.
Remember when Bill Gates saved Apple from bankruptcy?
Their competition pushed both to innovate faster.
Result? Both companies thrived, and consumers got better products.
The gamble paid off for Musk:
• More car companies entered the EV market
• Investment in charging infrastructure increased
• Public interest in EVs grew
• Tesla maintained its position as the EV leader
• More car companies entered the EV market
• Investment in charging infrastructure increased
• Public interest in EVs grew
• Tesla maintained its position as the EV leader
Elon Musk's open-source gambit proves an important point:
Sometimes, the best way to win is to change the game entirely.
By focusing on growing the pie instead of fighting for slices, Tesla reshaped an entire industry.
And that's how you lead a revolution.
Sometimes, the best way to win is to change the game entirely.
By focusing on growing the pie instead of fighting for slices, Tesla reshaped an entire industry.
And that's how you lead a revolution.
RT the first tweet if you found this thread valuable.
Follow me @seanpk for more threads on entrepreneurship, investing and human performance.
Follow me @seanpk for more threads on entrepreneurship, investing and human performance.
A bit about me:
20 years ago, I was a broke biomedical engineering college student trying to get my first biz off the ground.
Since then, I’ve grown six 7-figure businesses, three 8-figure businesses & raised $50M+ in VC. I'm also a General Partner at The Family Fund.
20 years ago, I was a broke biomedical engineering college student trying to get my first biz off the ground.
Since then, I’ve grown six 7-figure businesses, three 8-figure businesses & raised $50M+ in VC. I'm also a General Partner at The Family Fund.
And I do all of this while prioritizing my health, traveling for fun every month & not grinding 247.
I go deeper into everything I’ve learned about building businesses, investing & founder performance in my newsletter.
Join thousands of founders here: get.founderiv.com
I go deeper into everything I’ve learned about building businesses, investing & founder performance in my newsletter.
Join thousands of founders here: get.founderiv.com
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