I spent years avoiding investment in Tesla — but now is the moment to put faith in Elon Musk

Elon Musk’s Overlooked AI and Robotics Empire

Elon Musk stands at the helm of a formidable force in artificial intelligence and robotics—a reality that many believe is not yet fully reflected in Tesla’s market valuation.

How Musk Mirrors Rockefeller’s Path to Wealth

Elon Musk has become the wealthiest individual in history, following a strategy reminiscent of John D. Rockefeller. Rockefeller’s fortune didn’t come from discovering more oil than his peers—oil was abundant, and many struck it rich. However, when everyone is wealthy, that wealth is fleeting.

Rockefeller realized the real profits were not in the oil itself, but in controlling the infrastructure that moved oil from the ground to the consumer. He acquired pipelines, refineries, and railroad cars, securing shipping deals that drastically reduced his costs compared to competitors.

By the time others extracted their oil, Rockefeller owned every critical link between the well and the end user. His company, Standard Oil, didn’t just compete—it collected fees from everyone else.

Musk’s AI Strategy: A Modern Playbook

Elon Musk appears to be applying a similar approach to artificial intelligence. The investment community remains split on how to categorize Tesla. Some, like Wedbush Securities’ Dan Ives, argue that Tesla is the most undervalued AI company in the market. Others, such as Gordon Johnson of GLJ Research, insist Tesla is merely an overvalued car manufacturer. For years, the skeptics shaped consensus—but that view may be outdated.

After observing Tesla from the sidelines and questioning its valuation, I’ve come to see it differently. As a car company, the numbers seemed irrational. But as the only publicly traded gateway to a vertically integrated AI powerhouse, the story changes. I now hold Tesla shares.

What Musk Has Actually Built

Nvidia CEO Jensen Huang, whose company supplies the chips powering most AI systems worldwide, offered high praise for Musk during an October 2024 podcast. With decades of experience, Huang doesn’t speculate—he sees the real orders and progress. He described Musk as uniquely capable in engineering, large-scale construction, and resource management.

Huang’s admiration was sparked by Musk’s xAI Colossus data center, which went from bare ground in Memphis to 100,000 Nvidia GPUs running in just 19 days—a process that typically takes years. Similarly, Tesla’s Shanghai Gigafactory went from groundbreaking to producing vehicles in less than 11 months, defying industry expectations.

As Gavin Baker, a seasoned AI investor, explained, upgrading data centers for new AI hardware is a massive undertaking—akin to rewiring your entire home for a new phone. Speed of deployment, not just capital, is the true differentiator. While tech giants like Google and Microsoft have deep pockets, it’s Musk’s execution that sets him apart.

xAI recently announced it ended 2025 with over a million H100 GPU equivalents across its supercomputers, backed by $20 billion in new funding from Nvidia and Cisco. Musk envisions his companies merging into a unified AI ecosystem, offering a single entry point for investors.

In AI, being first to deploy and train models creates a self-reinforcing advantage: better models attract more users, generating more data, which in turn improves the models. Early movers build an almost insurmountable lead.

Tesla’s Hidden Data Advantage

Tesla possesses a data advantage that is largely overlooked. Every Tesla vehicle functions as a data-gathering tool, with cameras not just for safety but for real-time AI training. The fleet has logged nearly 7.3 billion miles, including 2.63 billion miles on city streets. Musk has stated that about 10 billion miles of data are needed for fully unsupervised driving.

While only about 12% of Tesla owners have Full Self-Driving (FSD) enabled, and Tesla’s system is still supervised (Level 2), the scale is unmatched. Waymo, Google’s self-driving arm, operates a much smaller, tightly controlled fleet. Tesla, with over 5 million vehicles, collects data at a scale Waymo can’t match—especially since Tesla’s customers pay for the privilege, while Waymo must purchase vehicles and hire drivers.

Another critical factor is the “checkpoint problem”—each AI lab’s latest model is used to train the next, and without access to the most recent checkpoint, competitors fall further behind. Tesla’s checkpoints are built on billions of miles of real-world experience, making it nearly impossible for newcomers to catch up.

Musk’s Vertically Integrated AI Stack

Rockefeller’s brilliance was in controlling every layer of the oil business. Musk is building a similar vertically integrated structure for AI:

• AI Research: xAI, a cutting-edge AI lab
• Global Connectivity: Starlink’s 9,500-satellite network
• Compute Power: Colossus supercomputers, scaling to a million GPUs
• Distribution: Tesla’s millions of vehicles and Optimus robots
• Funding: Tesla’s robust cash flow, with $4 billion in free cash in Q3 2025 and $41.6 billion in reserves
• Data Sources: X (formerly Twitter), with 600 million users generating unique, real-time content

Just as Rockefeller controlled oil from extraction to sale, Musk is building an AI empire from data collection to deployment—often while the market focuses on more obvious aspects of his businesses.

Why Wall Street Underestimates Musk

Jordi Visser coined the term “Musk discount” to describe how the market reacts skeptically to Musk’s predictions, even when his track record proves accurate in the long run. Musk’s forecasts are often optimistic on timing but correct in direction—whether it’s electric vehicles, reusable rockets, or neural networks driving cars.

Visser points out that regardless of whether Musk is early, on time, or late, the sectors he targets ultimately benefit investors. Wall Street’s focus on short-term results means it often misses the long-term competitive moats Musk is quietly building.

A Defining Moment Approaches

Nvidia’s Blackwell chips began shipping in early 2025, and xAI is among the first to deploy them at scale. When xAI unveils its first major model trained on this new infrastructure, the market will be forced to reconsider Tesla’s place in the AI landscape. This is not a distant possibility—the catalyst is expected by mid-year, and the answer to whether Tesla is an AI company will become clear.

Investment Implications

For those seeking exposure to Musk’s AI ventures, Tesla is currently the only public option. xAI, SpaceX, Starlink, The Boring Company, and Neuralink all remain private, though SpaceX may go public in 2026. Until then, Tesla is the sole gateway to Musk’s integrated AI ecosystem, spanning data, compute, distribution, deployment, and funding. The car business is simply the engine that finances this broader vision.

Despite being ranked last among the “Magnificent Seven” tech companies for AI exposure, Tesla’s true position may be vastly underestimated. By the time the market recognizes Tesla’s real role, Musk’s competitive moat may be unassailable.