Tesla was incorporated as Tesla Motors, Inc., on July 1, 2003, by Martin Eberhard and Marc Tarpenning. Eberhard is quoted as saying that he "wanted to build a car manufacturer that is also a technology company", with its core technologies as "the battery, the computer software, and the proprietary motor".
Tesla's first car, the Roadster, was a developement of a concept car called the Tzero, made by AC Propulsion, and also used components from the Lotus Elise.
Musk joined in 2004 when he invested a chunk of the money he raised from selling PayPal.