Retail traders will decide whether Elon Musk is worth another $50B. Here's what they're saying.

Arron Yohe-Mellor can admit it. He was a Tesla fanboy.

“I was on board. I was like, ‘Full self-driving? That sounds awesome.’ You know? Robotaxis?” the 43-year-old Los Angeles resident said. “And that’s originally why I bought the stock.”

But last Wednesday, he punched in an order to sell his 21 shares of Tesla, just after voting no on the reinstatement of Elon Musk’s roughly $50 billion compensation package that Delaware courts had struck down.

“Everything that they wanted, I went against, kind of just to stick it to them,” he said. “Fifty billion, that's bigger than the market cap of all of Ford. Is he worth giving all of Ford Motor Company to, for what he's done with Tesla?”

Perhaps no CEO has as direct — and increasingly fraught — a relationship with a retail shareholder base as the head of Tesla. Roughly 40% of the company’s shares are in the hands of retail investors, putting it among the top 3% of S&P 500 stocks for individual ownership.

Many of those shareholders were first drawn to Tesla by the outsized charisma of Musk, and his promises to turn a sci-fi vision of the future into today’s reality.

For years, the company made many of these people remarkably wealthy. Under Musk’s leadership, Tesla shares soared. Between the end of 2010 — the year the stock went public — and the stock’s peak in January 2022, Tesla shares rose more than 20,000%, as the companies valuation went from just over $2 billion to more than $1.2 trillion. The rise, at certain times, made Musk the wealthiest man in the world.

Since then, however, the stock has plunged by more than 50%, drastically underperforming the broader market and incinerating more than $500 billion of paper gains. Many shareholders have attributed the poor performance to the huge range of business interests that demand his attention, from his purchase of Twitter in 2022, to his space exploration company SpaceX, to his satellite internet firm Starlink, and most recently his AI-startup, xAI.

On top of those responsibilities, a string of stories about Musk’s behavior have emerged in recent years. The Wall Street Journal reported that leaders at SpaceX and Tesla have grown concerned about Musk’s drug use, which WSJ reported included LSD, cocaine, ecstasy, and psychedelic mushrooms. Separately, on Wednesday the WSJ reported on what it called “boundary-blurring relationships” with women at SpaceX.

Amid all that, stock holders are being asked for a second time to approve the largest CEO compensation package in history for Mr. Musk. This follows a Delaware judge’s decision on a shareholder lawsuit which rescinded the pay package, arguing that Musk effectively controlled the board of directors, and by extension his own compensation.

Pritam Basu, a Tesla shareholder living in London, voted to re-instate the package. He’s been a shareholder since late 2019, just before the stock exploded higher, though he stresses that he’s a long-term believer in the company.

“I think he's one of the main people driving Tesla forward, like his vision and his ability to get people to do things,” said Basu, the founder of a financial technology company. “Other people have said that kind of makes you believe or pushes you to kind of do these things. So so I think he's a huge factor for the success of Tesla.”

Likewise, John Buckoke, of Nottingham, England is a big believer in Musk.

“For me it's about honesty,” said Buckoke, who works in the electric vehicle charging infrastructure industry. “It's about a deal that the non-execs didn't object to, the company supported, the shareholders voted for at the time. So a judge has come and struck it down for a very kind of, almost a technicality, but also a little bit political.”

Where the vote — which is set to be counted on Thursday at the companies annual shareholders meeting — will eventually end up is unclear.

In recent days, some analysts have suggested they don’t think the compensation provisions will pass, potentially posing a risk of a short-term sell-off for the stock. Others, such as Wedbush tech analyst Dan Ives seem to think re-approval is all but a slam dunk.