Uber’s Earliest Investor Bill Gurley Just Dropped Bombshell News for Tesla Shareholders

Silicon Valley's oracle speaks—and electric vehicle investors should listen closely.

Bill Gurley's Track Record Speaks Volumes

The Benchmark Capital partner—who spotted Uber's potential before anyone else—just issued a stunning endorsement that could send Tesla valuations soaring. His timing couldn't be more perfect as traditional automakers struggle with their EV transitions.

Why This Matters Now

Gurley's endorsement comes exactly when legacy auto manufacturers are cutting their electric vehicle projections. While Detroit hesitates, Tesla continues dominating the premium EV space—proving once again that innovation beats tradition in the race for automotive supremacy.

The Cynical Take

Of course, Wall Street analysts will probably dismiss this as "anecdotal" while simultaneously raising price targets after the stock moves 20%—because why lead when you can follow?

Bottom line: When a visionary investor who backed one of the greatest disruptors of our time speaks about another disruptor? Smart money pays attention.

What did Bill Gurley say about Tesla?

A few days ago, Gurley joined a discussion on X (formerly Twitter) to push back against the claim that Tesla's valuation is a bubble waiting to burst.

If you study equity valuation theory, most models (such as a DCF) include the idea of "optionality". This represent the probability or odds that a company might be successful in new endeavors. No one ranks higher on that dimension than @elonmusk. Not even close.

Gurley began his explanation by pointing to one of the most widely used valuation tools in finance: the discounted cash FLOW (DCF) model. In simple terms, a DCF model projects a company's future cash flows and discounts them back to their present value using the weighted average cost of capital (WACC). This calculation provides an estimate for a company's intrinsic value today.

Applying this framework to Tesla, however, is anything but straightforward. The company's current revenue and profits are driven by sales of electric vehicles and energy storage services. Long-time Tesla supporters understand that this is only part of the equation, though.

As Gurley notes, what makes Tesla's valuation so elusive is the company's "optionality" embedded in its broader ambitions. Beyond its legacy operations, Tesla is pursuing transformative bets in artificial intelligence (AI) -- particularly an autonomous ride-hailing fleet, known as the robotaxi, and its humanoid robotics platform, Optimus.

Image source: Getty Images.

Why is this important for Tesla investors?

By highlighting Tesla's optionality, Gurley is drawing a parallel to the kind of platform potential that underpinned his success with Uber. The comparison is striking, given that Tesla and Uber can currently be viewed as fierce rivals in the mobility market.

Gurley's acknowledgement of Tesla's ambitions beyond EVs and energy storage signals that he sees its so-called moonshot bets as too significant to dismiss. In effect, he may be suggesting that Tesla's innovation pipeline extends well beyond the confines of traditional competition -- underscoring the idea that overlooking these opportunities could prove to be a costly mistake in the long run.

Is Tesla stock a buy now?

For investors, Gurley's observation carries important implications. He reframes the narrative around Tesla as one beyond an automobile manufacturer but rather a more diversified platform spanning multiple ventures.

As the chart below illustrates, Tesla's expanding price-to-sales (P/S) and price-to-earnings (P/E) multiples suggest that the market is struggling to assign appropriate values to its emerging businesses, given that the company has yet to meaningfully commercialize them.

TSLA PS Ratio data by YCharts

In other words, a portion of the anticipated upside from initiatives like robotaxi and Optimus already appears priced in to Tesla's valuation despite their limited traction today. With that in mind, some investors may choose not to follow the clear momentum pictured above.

At the same time, Gurley implies that Tesla indeed should be valued less in line with capital-intensive car or energy companies and more as a technology-driven growth enterprise. Ultimately, Gurley's comments underscore the hidden multiplier potential that Tesla's optionality provides in its valuation. Should Musk and the team execute successfully, Gurley's insights may prove prophetic -- and what looks like a frothy valuation today could ultimately appear conservative in hindsight.

In my view, investing in Tesla stock today boils down to your personal alignment with the very narrative that Gurley points out.

If you are more risk-averse, then it's likely better to wait and see how Tesla scales its AI businesses and assess how these next-generation products MOVE the needle for the business.

By contrast, if you are a growth investor and plan to hold onto a Core position in Tesla over the course of several years, now may be an interesting time to scoop up some shares, as more upside could very well be in store, as Gurley alludes.