Tesla CEO Elon Musk recently became the world’s richest person, and while it’s an impressive feat, the behind-the-scenes benefactors of Tesla’s growth are, perhaps, even more impressive.
Baillie Gifford, the asset management firm for Scottish Mortgage Investment Trust, has facilitated a $29 billion profit from pension funds, foundations, and charities, financed through the purchase of Tesla’s stock in 2013, when its shares were just $6 a piece, as detailed in a profile by The Guardian.
Tesla’s shares have grown 640% in the last year alone, contributing to Musk’s personal fortune in addition to the wealth of a hefty number of investors.
Oppenheimer Doubles Tesla Price Target to $1,036 https://t.co/1tpugYEMWP
— TeslaNorth.com (@RealTeslaNorth) January 20, 2021
The firm was advised not to purchase Tesla’s shares back in 2013, and as it turns out, the group’s advisors couldn’t have been more wrong.
Subsequently, the purchase of the stock led Scottish Mortgage to be included on the FTSE 100 index in 2017, which included the UK’s 100 biggest companies that year. In 2019, Scottish Mortgage rose to become the FTSE 100’s best-performing company, larger due to its reliance on Tesla’s shares.
Fund manager James Anderson first made the decision to invest in Elon Musk’s company in 2013. He told The Guardian, “To us it was, frankly, clear even back half a dozen years that the underlying technologies from batteries, to solar to eventually self-driving were progressing and would continue to do so.”
“We thought (and simply observed) that Tesla was already past the technological and practical challenges to a good degree and that execution and finance were the practical issues. What we needed was time. Not many investors can have that luxury and necessity,” said Anderson.
The Scottish group made $14.8 billion profit during the last calendar year, while made $14.6 billion on shares it has retained, resulting in a total profit of $29.5bn for 2020.
On Wednesday, Tesla is expected to report its sixth straight quarter of profit gains. As of writing, the company’s shares are currently trading at $866.59 (+2.38%), with an overall market capitalization of $802.53 billion.
