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Tesla Motors was incorporated in the summer of 2003. At that time, “Tesla Motors, Inc.” consisted of Eberhard, Tarpenning and Wright, and an unfunded business plan. The men were looking for an initial round of funding to create a more advanced prototype than the AC Propulsion Tzero concept car. Tesla hadn’t registered or obtained the trademark to its name and had no formal offices or assets.

The initial, Series A investment round of USD$7.5 million was led by PayPal co-founder Elon Musk in April 2004 and included Compass Technology Partners as well as many private investors. Musk, a South African-born entrepreneur, became Tesla’s Chairman of the Board and in February 2005, led Tesla Motors’ second, USD$13 million Series B investment round which added Valor Equity Partners to the funding team. Musk co-led the third, USD$40 million Series C round in May 2006 along with VantagePoint Venture Partners. Tesla’s third round included investment from prominent entrepreneurs including Google co-founders Sergey Brin & Larry Page, former eBay President Jeff Skoll, Hyatt heir Nick Pritzker and added the VC firms Draper Fisher Jurvetson, Capricorn Management and The Bay Area Equity Fund managed by JPMorgan Chase.

The fourth, Series D round in May 2007 added another USD$45 million and brought the total investments to over $105 million USD through private financing. The fifth, Series E round in February 2008 added another USD$40 million. Musk, who was President of PayPal before it was bought by eBay, has contributed $70 million of his own money to the company. By January 2009, Tesla had raised USD$187 million and delivered 147 cars.

In August 2007, Martin Eberhard was replaced by an interim CEO, Michael Marks. In December 2007, Ze’ev Drori became the permanent CEO and President of Tesla Motors. In January 2008, Tesla Motors fired several key personnel who had been involved from the inception after a performance review by the new CEO. According to Musk, Tesla was forced to reduce the company workforce by about 10 percent to lower its burn rate, which was out of control in 2007. In October 2008, Musk succeeded Ze’ev Drori as CEO. Drori became Vice Chairman and remained on the Board of Directors.

On May 19, 2009, Germany’s Daimler AG, maker of Mercedes, acquired an equity stake of less than 10 percent of Tesla for a reported $50 million. The investment deepened the relationship between the inventor of the automobile and the newest member of the global auto industry. As part of the collaboration, Prof. Herbert Kohler, Vice President E-Drive and Future Mobility at Daimler AG, took a seat on Tesla’s board of directors. In July, Daimler announced that Abu Dhabi’s Aabar Investments bought 40 percent of Daimler’s interest in Tesla.

In June 2009 Tesla was approved to receive $465 million in interest-bearing loans from the United States Department of Energy. The funding, part of an $8 billion program for advanced vehicle technologies (Advanced Technology Vehicles Manufacturing Loan Program), supports engineering and production of the Model S sedan, as well as the development of powertrain technology that Tesla plans to sell to other automakers. The low-interest loans are not related to the “bailout” funds that GM and Chrysler have received, nor are they related to the 2009 economic stimulus package. The Department of Energy loan program was created in 2007 during the George Bush administration in order to get more fuel-efficient vehicle options to U.S. consumers and to decrease the country’s dependence on foreign oil.

The company announced in early August 2009 that it had achieved overall corporate profitability for the month of July 2009. The company said it earned approximately $1 million on revenue of $20 million. Profitability arose primarily from improved gross margin on the Roadster 2, the second iteration of Tesla’s award-winning sports car. Tesla, which like all automakers records revenue when products are delivered, shipped a record 109 vehicles in July and reported a surge in new Roadster purchases.
(http://hicars.org/2009/08/tesla-logo-history.html) www.teslamotors.com