Elon Alone: Long-Time Tesla Tech Chief Straubel's Exit Leaves Musk As Sole Remaining Cofounder

Elon Musk has a reputation for startling news, but his announcement that fellow Tesla cofounder JB Straubel is stepping down as chief technology officer was particularly significant as it marks the end of an era that saw the company evolve from a shoestring Silicon Valley garage startup to the world’s leading electric vehicle maker. 

Musk wedged in the Straubel news awkwardly amid an earnings call late Wednesday, after the company posted a bigger-than-expected second-quarter loss–despite selling a record number of high-powered electric sedans and crossovers during the period. The weak financials triggered an 11% drop in Tesla shares in after-hours trading. 

Straubel is “transitioning to a senior adviser from the CTO role and Drew Baglino will be taking over most of JB’s responsibilities,” Musk told analysts and investors. “I’d like to thank JB for his fundamental role in creating and building Tesla. If we hadn’t had lunch in 2003 Tesla wouldn’t exist, basically.”

A low-key, Stanford University-trained engineer, Straubel summed up his time with the company as “an adventurous 16 years.”

“I’m not disappearing,” he said. “I want to make sure that people understand that this is not about some lack of confidence in the company or the team or anything like that. I love the team, I love the company and I always will.”

Though he’d been less visible in recent years, Straubel was instrumental at Tesla’s outset, overseeing the design of the battery pack and electric motor that went into its original Roadster a decade ago. He also worked to refine and improve those and other components for the all the company’s subsequent vehicles, from Model S through the X, 3 and Model Y that goes into production this year. Dozens and dozens of Tesla patents credit Straubel as an inventor. 

His departure from day-to-day work may not have arisen from workplace disagreements or dissatisfaction, but it extends a worrisome trend: Tesla’s inability to retain a significant core of long-term veterans in top management roles. The past two years, covering the tortured rollout of the Model 3 sedan, have seen an unusually high rate of executive departures including long-time CFO Deepak Ahuja, former senior director of battery tech Kurt Kelty, Diarmuid O’Connell, Tesla’s long-time head of business development, and manufacturing veterans like Nick Kalayjian, who’d been vice president of engineering. 

While the original concept for Tesla wasn’t Musk’s (or Straubel’s), his funding brought the company to life in 2004. Shortly after Musk made his initial fortune from the sale of PayPal, for which he’s also credited as a cofounder, he connected with Straubel at a 2003 Stanford lecture and a subsequent lunch. The two found a shared interest in adapting advances in consumer electronics, particularly small lithium-ion battery cells, for use in transportation. 

“That was the premise Elon and I discussed over that first lunch: that batteries have come much further than anyone expects, certainly than the auto industry expects,” Straubel said in a 2013 Bloomberg profile. 

The two connected with Martin Eberhard and Marc Tarpenning, who founded Tesla in 2003 as a tribute to engineer Nikola Tesla, and helped get the company into operation, joined by engineer Ian Wright. Wright left in 2004, Eberhard, Tesla’s first CEO, departed in 2007, followed by Tarpenning in 2008.

Straubel and Musk meshed well in a relationship reminiscent of Apple cofounders Steve Jobs and Steve Wozniak, with Musk seeming to serve as Tesla’s master marketer and company visionary and Straubel acting as reliable lab rat. 

“We are almost always on the same wavelength–or one of us will adjust his opinion according to the arguments,” Musk told Bloomberg. “JB is an exceptionally reasonable and smart guy.”

More recently, Straubel had played a major role overseeing Tesla’s sprawling Gigafactory in Sparks, Nevada, a multibillion dollar facility that the company says is already the world’s largest battery plant even as years of construction continue. 

Musk’s early and consistent investment in Tesla turned him into a billionaire, with a net worth Forbes estimates to be at least $20 billion. Straubel has become wealthy from his many years at the carmaker, though he’s not in Musk’s league. A company proxy statement early this year indicated Straubel beneficially owned more than 618,000 Tesla shares, though he’s been selling them regularly since then. Forbes estimates his current net worth at approximately $100 million.