Billionaires: Elon Musk appoints Airbnb co-founder to Tesla’s board

In our fortnightly round-up of the world's super wealthy, Mike Novogratz says cryptocurrencies are more resilient after a forced seller exodus and Sam Bankman-Fried considers bidding for assets of bankrupt lender Celsius Network

Joseph Gebbia, co-founder of Airbnb, has waived entitlement to cash compensation after joining Tesla's board. Bloomberg via Getty Images
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Joseph Gebbia

Billionaire Airbnb co-founder Joseph Gebbia has joined Tesla's board, reversing a move to trim the number of directors at the world's most valuable electric vehicle maker.

Tesla said in June that it planned to have only seven board seats after the departure of Oracle co-founder Larry Ellison in August, sparking criticism from a shareholder body over a lack of independent board members.

In July, SOC Investment Group filed a complaint with the US Securities and Exchange Commission (SEC) saying Tesla's plan failed to comply with a 2018 “consent decree” with the SEC that included having two independent board seats.

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Watch: Who is billionaire Elon Musk?

That agreement stemmed from a tweet by chief executive Elon Musk about taking Tesla private. Mr Ellison, a self-described close friend of Mr Musk, was appointed by Tesla in December 2018 to comply with the agreement.

Mr Gebbia, a designer and internet entrepreneur with a net worth of $7.48 billion, joins Tesla after saying in July he would take on an advisory role at Airbnb, stepping away from his full-time role.

“Congrats on an incredible company with Airbnb, now for Book 2!” Mr Musk tweeted at the time.

Some experts doubted whether the billionaire would add diversity to the Tesla board.

“This sounds like more of the same. More of the bros of Mr Musk rather than someone new and different,” said John Coffee, a professor and director at the Centre on Corporate Governance at Columbia Law School.

Mr Gebbia, 41, has waived all entitlement to cash compensation and has agreed to not take any stock-based rewards until July 2023, Tesla said in a regulatory filing.

Mike Novogratz, founder of Galaxy Investment Partners, believes that the cryptcurrency sector has been more resilient over the past month. Getty Images

Mike Novogratz

Mike Novogratz, the billionaire founder of Galaxy Digital Holdings, said cryptocurrencies had been relatively resilient in the past month ― partly because there are not many forced sellers left in the sector.

“We’re in this weird equilibrium where there are a few buyers, there are a few sellers and there’s not that energy in the market like you’re seeing in the equity market or the bond market where you have to sell, right?” Mr Novogratz said.

A lot of leverage has been taken out of the crypto sector, he said during a panel discussion at a conference in Singapore.

Digital tokens will take off again as soon as the US Federal Reserve flinches from its current path of aggressive monetary tightening, but not in a sustainable fashion until mass adoption of Web3 projects, he added.

Meanwhile, Mr Novogratz told the panel that the implosion of Do Kwon’s Terraform Labs project was “heartbreaking” and a lesson for the cryptocurrency industry. He said Mr Kwon was among the smarter people he had met and “I wish him well”.

Mr Novogratz, who has a net worth of $6.84bn, was a big backer of Terraform Labs. Mr Kwon’s location is unknown and he is the subject of an Interpol red notice in the fallout of the $40bn collapse of his Terra ecosystem in May.

Sources say that Sam Bankman-Fried, the billionaire founder of FTX US, is considering bidding for the assets of bankrupt lender Celsius Network. Bloomberg

Sam Bankman-Fried

Sam Bankman-Fried, the co-founder of cryptocurrency exchange FTX US, is considering bidding for the assets of bankrupt lender Celsius Network, a person familiar with his deal-making says.

FTX was also in the process of raising a $1bn funding round, the same person said. That round has not closed yet or been made public.

In addition to its lending business, Celsius, which filed for bankruptcy in July, owns large Bitcoin mining operations and a crypto-custody business.

It is not known if Mr Bankman-Fried’s crypto companies — FTX or trading arm Alameda Research — are considering bidding for some or all of Celsius’s assets.

Celsius’s token, Cel, jumped by as much as 9.9 per cent on the development before retreating again, data from CoinGecko showed.

Mr Bankman-Fried, who has a personal fortune of $9.44bn, already scooped up the assets of bankrupt crypto brokerage Voyager Digital in an agreement valued at about $1.4bn.

Earlier this year, FTX propped up crypto platform BlockFi and was exploring a potential takeover of Robinhood Markets, in which Mr Bankman-Fried owns a stake. He is estimated to own more than 50 per cent of FTX US, and almost all of Alameda.

Alex Mashinsky, chief executive of Celsius, resigned on Tuesday and the company and its creditors are considering several alternatives, ranging from restructuring to liquidation.

In August, the company said it had received many offers of fresh cash to help to fund its restructuring process.

Larry Page, the billionaire co-founder of Google, was a backer of Kittyhawk, an air-taxi company that announced it would be closing down, AP

Larry Page

Kittyhawk, the air-taxi company backed by billionaire Google co-founder Larry Page, will be closing down, dealing a setback to the long-elusive dream of developing flying cars.

“We have made the decision to wind down Kittyhawk,” the company said on Twitter. “We’re still working on the details of what’s next.”

The company’s technology is expected to live on in the form of its Wisk Aero joint venture with Boeing. Wisk’s operations would not be affected by Kittyhawk’s shutdown, Boeing said on Wednesday.

Kittyhawk traces its history to 2010, when a company then known as Zee. Aero set out to pioneer the market for so-called eVTOLs — electric vertical take-off and landing aircraft — ultimately with the goal of democratising the skies.

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Watch: Electric flying taxi takes to skies in test flight

The secretive company was run by Sebastian Thrun, a Google veteran who worked on self-driving cars, augmented-reality glasses and other projects.

The business was one of several start-ups working on the concept, which has proven to be a greater challenge than some expected. Air taxis have suffered crashes during testing in recent months, raising concerns about their safety.

Kittyhawk formed its Wisk venture with Boeing in 2019 and the plane manufacturer went on to invest $450 million in the partnership. Earlier this week, Boeing and Wisk presented their vision for a world where eVTOLs can coexist with larger commercial aircraft.

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Kittyhawk’s decision to cease operations does not change Boeing’s commitment to Wisk
Boeing spokeswoman

“Kittyhawk’s decision to cease operations does not change Boeing’s commitment to Wisk,” a spokeswoman for Boeing said.

“We are proud to be a founding member of Wisk Aero and are excited to see the work they are doing to drive innovation and sustainability through the future of electric air travel.”

Boeing helped to showcase Wisk’s rotor-powered Cora aircraft at the Farnborough International Airshow in July.

Along with financing the business, Boeing has been providing engineering resources for a larger, electric four-seater aircraft that Wisk intends to eventually certify with US regulators.

The air-taxi market still has numerous competitors, including Joby Aviation, Archer Aviation, Germany’s Lilium NV and Brazil’s Eve, but they face uncertain prospects for these futuristic vehicles. Aviation regulators have not yet certified the new generation of flying machines to transport humans.

Kittyhawk’s goal was to make an air taxi that could be remotely piloted, was smaller and lighter than other eVTOLs, and could take off from nearly anywhere. The company was aiming for a cost of less than $1 a mile, which would have made the taxis cheaper than ride-sharing services.

Now Kittyhawk’s shutdown closes a chapter for one of the highest-profile eVTOL pioneers — and shows how hard the market is to crack. As of Wednesday, the company still had this message on its home page: “If anyone can do this, we can.”

Reuters and Bloomberg

Updated: October 03, 2022, 5:00 AM
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