Elon Musk’s tunnel-digging venture, the Boring Co., is being pulled into the billionaire entrepreneur’s controversial practice of spreading overlapping assets across his disparate technology firms.
On Tuesday, the Tesla Inc. TSLA -3.27% chief is set to unveil a test tunnel developed by the Boring Co., the first of what Mr. Musk imagines as a futuristic series of high-speed underground highways to alleviate traffic.
The entrance of the two-mile-long Boring test tunnel is being constructed in Hawthorne, Calif., at the headquarters of another Musk-controlled company, Space Exploration Technologies Corp., partly by SpaceX employees using equipment purchased with SpaceX funds, people familiar with the matter said.
The arrangement alarmed some longtime investors in SpaceX, including its largest outside backer, Peter Thiel’s Founders Fund, some of the people said. The investors learned in recent months that despite the diversion of SpaceX resources and staffing to the fledgling Boring startup, it was Mr. Musk who was in line to receive almost all of any future profits, these people said.
The investors questioned SpaceX about why their investment dollars into a company ostensibly devoted to launching satellites and carrying humans to Mars were instead partly used to start a separate company that principally benefited Mr. Musk. When the Boring Co. was earlier this year spun into its own firm, more than 90% of the equity went to Mr. Musk and the rest to early employees, the company has said.
The SpaceX board never voted on devoting resources to Mr. Musk’s new venture.
The Boring Co.’s unusual inception is illustrative of how Mr. Musk defies the conventions of traditional corporate chieftains and sometimes supports his business empire by shuffling finances between companies.
I think that technical term, of course, is fraud and embezzlement.
ToMAYto/ToMAHto, whatever, I guess, because these days, the motto is, “Let Bond Villains be Bond Villains.”
Listen to the cat, listen to the cat.
*I do mean this characterization of Thiel literally. He is literally a vampire who wants to use the blood of the young to extend his lifespan.