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Which famous technology company nearly went bankrupt because customers wanted its products faster than it could afford to make them?
Total votes: 255
Correct answer: B. Tesla.
Explanation:
In 2018, Tesla was struggling to ramp up production of its Model 3.
Demand was strong, but manufacturing cars at scale required enormous investment in factories, machinery and staff.
Elon Musk later said Tesla had come within weeks of bankruptcy.
It’s a fascinating investing paradox.
A company can have a product customers desperately want and still run out of money trying to deliver it.
That’s why investors need to distinguish between companies spending heavily because demand is booming and those spending heavily without a realistic prospect of earning that money back.