SolarCity’s former CEO now plans Tesla departure, new startup venture
Lyndon Rive, one of the co-founders and the former CEO of SolarCity Corp., will leave his post at parent company Tesla Inc. next month.
Rive told Reuters in an interview on Monday that he is leaving Tesla to pursue a new startup opportunity sometime next year, though he didn’t name a company. Rive, a native of South Africa, also said he would like to spend more time with his family.
“Because of his leadership and dedication to our mission, Lyndon has helped position Tesla for an amazing future,” a Tesla spokeswoman said in a statement. “We know he’s an entrepreneur at heart and we wish him the very best on his next venture.”
Rive said he began to consider leaving Tesla a few months ago.
“My skill set and what I love doing is starting and running companies,” Rive told Reuters. “I can hand off the baton to somebody else and give myself the opportunity to do something else that could also have another impact.”
Rive serves as head of sales and services for Tesla’s energy division, a position he’s held since Tesla acquired SolarCity for $2.6 billion last August.
The electric car maker is owned by Rive’s cousin, billionaire entrepreneur Elon Musk, who purchased the residential solar company to expand on his own business plans.
In fact, Musk provided some financial help in 2006 to Rive, who co-founded SolarCity along with his older brother, Peter Rive, who served as CTO of the San Mateo, Calif.-based company, a clean energy services provider that designs, finances and installs photovoltaic systems and builds charging stations for electric vehicles. The Rive brothers ran SolarCity independently until Tesla bought it.
Lyndon Rive’s responsibilities at Tesla will be redistributed among Tesla leadership, according to Tesla. Peter Rive plans to stay on at Tesla as vice president of solar products.
Falling installations
As the former SolarCity CEO, Rive had wanted to make rooftop solar energy affordable to everyone in an effort to combat climate change by turning demand away from fossil fuels. He told Reuters that SolarCity is “healthier than it’s ever been.”
SolarCity hit 300,000 customers late last year and last week, Tesla launched its innovative solar roof tiles, a product that generates electricity without traditional rooftop panels.
Nevertheless, under Tesla, SolarCity has slowed installations and focused on the most profitable projects that generate cash up front, according to the company’s earnings report released this spring.
Specifically, Tesla’s SolarCity on May 3 reported an almost 40 percent plunge in solar installations for the first quarter of 2017. The company had announced in late April that it was curtailing door-to-door sales and would instead prioritize higher-margin projects that generated up-front cash.
Investors and other interested parties wondered: Does the dramatic decrease in sales for a company that had regularly delivered double-digit growth mean Tesla has realized the same trend hitting many others in the rooftop-solar industry?
Industry competition thus far has pushed out some companies and forced others to scale back. For example, Sungevity, one of the largest rooftop solar companies in the United States, filed for bankruptcy this year.
The Solar Energy Industries Association and GTM Research reported a 66 percent rise in rooftop solar installations between 2014 and 2015. The growth rate declined to 19 percent in 2016. The trend is expected to worsen this year.
In April, Musk converted $10 million in SolarCity notes to 33,333 shares of Tesla stock at a $300 per share price.
“The conversion of SolarCity notes is seen as more of an administrative transaction, as the resulting number of shares gained is a little more than a few drops in the bucket when compared to the 33,599,088 number of shares of Tesla stock Musk owned prior to the transaction,” according to Tesla Investor Relations.
Another report suggested the conversion was another Musk investment in Tesla to improve its cash burn situation because the car maker had to raise money to finance the production of a new model being released in July.
Tesla stock—traded on NASDAQ as TSLA was down to about $306 per share late Wednesday, a drop from its $314.39 opening price.
