The mercurial American entrepreneur saw Tesla shares drop the next day, closing down some 5 percent.
Under the deal, Musk will relinquish his role as Tesla's chairman for three years and pay a $20 million fine.
For his Boring Company tunneling venture, Musk raised $1 million and drew media attention last year for selling 50,000 branded hats, and earlier this year, he raised $10 million by selling 20,000 branded flamethrowers.
FILE PHOTO: Tesla Motors CEO Elon Musk reveals the Tesla Energy Powerwall Home Battery during an event in Hawthorne, California, U.S., April 30, 2015. Two new independent directors will be recruited to join Tesla's board of directors. The tweet claimed "funding secured" as Musk floated the idea of taking the Silicon Valley automaker private at $420 per share. Musk later scrapped the proposal, saying investors believed that Tesla would be "better off as a public company". Specifically, Musk called out a goal of one million miles, the same number which the posted drive unit is said to have driven.
Thanks to Musk's vision and showmanship, Tesla's valuation has at times eclipsed that of traditional, established USA automakers that make millions of vehicles and billions of dollars in profits annually, and the company has garnered legions of fans despite repeated production issues.