Inspiring Success Story Of Elon Musk
Ranked 34th Richest in America and 38th most Powerful in the world –– Elon Musk is the founder of SpaceX, chief product architect of Tesla Motors, chairman of SolarCity, and co-founder of PayPal, and overall – an entrepreneur, business magnate, investor, engineer and inventor.
As of June 2016, he has an estimated t be of net worth of $11.5 Billion, making him the 83rd wealthiest person in the world.
He is known to be the second entrepreneur in the Silicon Valley (first: James Clark) who has managed to create three companies that have a market capitalization of more than $1 billion – PayPal, SpaceX, and Tesla Motors.
He is one of the few people that believes in investing in projects that hold the potential of change our world. As a matter of fact, Elon personally participates in the designing of electric cars and spaceships at his companies.
Elon has also designed the goals of SolarCity, Tesla Motors, and SpaceX that revolve around his vision to change the world and humanity. His goals include reducing global warming by use of sustainable energy production and consumption, and reducing the risk of human extinction by making life multi-planetary, by setting up a human colony on Mars.
Talking about philanthropy –– he runs an organization called Musk Foundation, to fulfil his philanthropic efforts on providing solar-power energy systems in disaster areas.
* It collaborated with SolarCity to donate a 25-kW solar power system to the South Bay Community Alliance’s (SBCA) hurricane response centre in Coden (Alabama) (2010).
* Donated $250,000 towards a solar power project in Sōma (Japan) that had been recently devastated by tsunami (July 2011).
* Donated $1 million towards the construction of the Tesla Science Center at Wardenclyffe and also pledged to build a Tesla Supercharger in the museum car park, to cartoonist Matthew Inman and the great-nephew of Nikola Tesla – William Terbo (July 2014).
* Donated $10 million to the Future of Life Institute to run a global research program aimed at keeping artificial intelligence beneficial to humanity (January 2015).
* Trustee of the X Prize Foundation and a signatory of The Giving Pledge (2015)
His family includes his parents, Maye (mother), Errol (father), Tosca (sister), and Kimbal Musk (brother). He has been married twice, and has two wives and six children.
What was growing up as Elon Musk like?
Every biography of famous people usually contains key episodes from their lives that lead them to an overwhelming success. Elon has his share of stories as well!
Elon was born on the 28th of June 1971 in South Africa, to a model and dietician mother and an electromechanical engineer father.
After his parents divorced in 1980, Elon lived mostly with his father. During that phase, he developed an interest in computing with the Commodore VIC-20.
He self learned computer programming and used to sell the code for a video game he had created called Blastar for $500, to a magazine called PC and Office Technology.
Throughout his childhood, Elon was severely bullied and was even hospitalized when was thrown down a flight of stairs and then beaten until he blacked out.
After graduating from a secondary school in Pretoria, Elon left his home, and migrated to the United States. Without the support of his parents! Although, he didn’t get into the United States right away!
He first moved to Canada to the relatives of his mother in 1989 and attained a Canadian citizenship and moved to Montreal. He began with low paid jobs and somehow survived at the brink of poverty. At the age of 19, he moved to Queens University (Ontario).
Elon Musk studied for two years in Ontario and then, finally, got the opportunity to relocate to the United States in 1992. He had received a scholarship from The University of Pennsylvania: Penn.
He went on to complete his Bachelor of Science degree in Physics and then also went on to achieve a degree in Economics from The Wharton School.
In 1995, Elon finally moved to Stanford University in California to attain a PhD in applied physics and materials science but left the program after two days to pursue his entrepreneurial aspirations in the areas of the Internet, renewable energy and outer space.
And that’s where it all began!
Journey to becoming the Elon Musk we know…
After dropping out of Stanford, Elon and his brother Kimbal borrowed $28,000 from their father and launched a software company called Zip2 in 1995.
The Internet was beginning to expand by manifolds, and newspapers were trying to figure out how they could make the best use of the new medium.
That is when the Musks decided to help the newspaper publishers and developed an online city guide for them. Soon, the company also won contracts from major players in the industry, including The New York Times and the Chicago Tribune, and even persuaded the board of directors to abandon plans for a merger with CitySearch.
Eventually, in February 1999 the Musks sold Zip2 to Compaq for $307 million in cash and $34 million in stock options. Elon received $22 million for his 7% stake from the sale.
Soon after the sale, using $10 million from the sale of Zip2, Elon co-founded another venture called X.com!
X.com was an online financial services and e-mail payment company, which got merged in about a year with Confinity – that had a money transfer service called PayPal.
The merged company mainly focused on the PayPal service. Its early growth was driven mainly by a viral marketing campaign where new customers were recruited when they received money through the service.
In October 2000, Elon was overthrown from his role as CEO (although he remained on the board). This was due to the disagreements with other company leadership over his desire to move PayPal’s Unix-based infrastructure to Microsoft Windows.
All of this happened in the late 2000, when Elon took his first vacation in a long time. While he was on the flight, which was still in the air en route to Australia, is when the PayPal’s board fired him and made Peter Thiel the new CEO.
The merged entity was eventually renamed to PayPal in 2001 as well!
And then in October 2002, PayPal was sold to eBay for $1.5 Billion in stock, of which Elon, who was the largest shareholder, received US$165 million for his 11.7% stake.
But Pay Pal was not the end of the road for Musk; on the contrary, it was merely the beginning of far more ambitious projects. One being – Space exploration! Elon always wanted to make, sending people to different planets, possible.
And, in 2001, he decided to fulfil it as well. Elon began by conceptualizing a project to land a miniature experimental greenhouse on Mars, that would contain food crops growing on Martian regolith called –– “Mars Oasis”.
He even travelled to Moscow along with Jim Cantrell (an aerospace supplies fixer), and Adeo Ressi (his best friend from college), to buy refurbished ICBMs (Inter Continental Ballistic Missiles) that could send the envisioned payloads into space in 2001, and also met with companies such as NPO Lavochkin and Kosmotras, too.
But, to their luck – Elon was seen as a novice and was denied of the requirement, and the group returned empty-handed.
Not ready to give up, the group returned back to Russia bringing along Mike Griffin in February 2002. Mike had worked for the CIA’s venture capital arm – In-Q-Tel; NASA’s Jet Propulsion Laboratory; and was just leaving Orbital Sciences (a maker of satellites and spacecraft).
This time they went on a hunt for three ICBMs and even met with Kosmotras, but since they were offered a very expensive price of $8 Million, Elon stormed out of the meeting and returned back.
While on his flight back, Elon realised that he could start a company that could build the affordable rockets he needed. Upon calculation, he noticed that the raw materials for building a rocket actually costed for only 3% of the sales price of a rocket at the time.
And by applying vertical integration and the modular approach from software engineering, they could cut the launch price to one-tenth of its original value and still enjoy a 70% gross margin.
Ultimately, with $100 million from his early fortune, in June 2002, Elon ended up founding Space Exploration Technologies, or SpaceX.
He was the CEO and CTO of the California-based company, which aimed to develop and manufacture space launch vehicles with a focus on advancing the state of rocket technology.
Since its initiation, the company has gone on to create a lot of news, for several of its accomplishments. Their first two launch vehicles (Falcon 1 and Falcon 9 rockets), and their first spacecraft (Dragon), became the 1st two privately funded liquid-fuelled vehicles to put a satellite into Earth orbit.
In seven years, SpaceX has also gone on to design a family of Falcon launch vehicles and the Dragon multipurpose spacecraft, which has also berthed with the ISS (International Space Station).
Furthermore, in 2006, SpaceX also received a contract from NASA to continue with the development and test of the SpaceX Falcon 9 launch vehicle and Dragon spacecraft in order to transport cargo to the International Space Station.
This was followed by a $1.6 Billion NASA Commercial Resupply Services program contract for 12 flights of its Falcon 9 rocket and Dragon spacecraft to the Space Station that would replace the US Space Shuttle after it retired in 2011.
Over the period of time – SpaceX has grown on to become the, both the largest private producer of rocket motors in the world, and holder of the record for highest thrust-to-weight ratio for any known rocket motor.
Presently, Elon is now working on the first unmanned flight of the larger Mars Colonial Transporter (MCT) spacecraft that is aimed for departure to the red planet in 2022. This will be followed by the first manned MCT Mars flight in 2024. He wants to colonize Mars!
In 2003, Martin Eberhard and Marc Tarpenning had incorporated Tesla Motors, and had started with their own funds until the Series-A round of funding.
Both men played active roles in the company’s early development. In February 2004, their raised their Series-A round of funding from Elon Musk, which led to the integrating of Elon on Tesla’s board as its chairman.
Although, Elon wasn’t involved in the day-to-day business operations of the company, he still had an active role within the company and oversaw Roadster product design at a detailed level.
It was only in 2008, after the financial crisis that he assumed the position of the CEO and product architect, under whom, Tesla Motors built an electric sports car – the Tesla Roadster in 2008, which accounted for sales of about 2,500 vehicles to 31 countries.
In 2010, Tesla Motors became the second car-manufacturing company (after Ford) in the US history to launch their initial public offering (IPO). Despite being unprofitable for 10 years, Tesla got listed on NASDAQ with $17 per stock and attracted more than $225 million of investments as well.
Since then, the company has gone on to develop several models, including – their four-door Model S sedan, the Model X, the Model X, electric powertrain systems for Daimler for the Smart EV, Mercedes B-Class Electric Drive and Mercedes A Class, and to Toyota for the RAV4 EV.
As of January 29, 2016, Musk owns about 28.9 million Tesla shares (about 22% of the company), and takes home an annual salary of $1, and similar to Steve Jobs and Mark Zuckerberg, the remainder of his compensation is in the form of stock and performance-based bonuses.
Other than these – Elon also owns or has invested in several other ventures as well.
To begin with – given that he wanted to help combat global warming, Elon had invested in SolarCity, which was co-founded in 2006 by his cousins Lyndon and Peter Rive. Today, he is the largest shareholder of SolarCity that has also become the second largest provider of solar power systems in the United States.
In 2013, Elon had unveiled a concept for a high-speed transportation system, called – Hyperloop. It would integrate reduced-pressure tubes in which pressurized capsules ride on an air cushion driven by linear induction motors and air compressors. Basically, transporting people from one place to another in high-speed compact capsules!
The conceptual foundations and designs for the transportation system has already been made and approved by a dozen of engineers from Tesla Motors and SpaceX. And an early design for the system has also been published in a whitepaper posted to the Tesla and SpaceX blogs as well. The total cost of Los Angeles-to-San Francisco Hyperloop system is being estimated at $6 Billion.
Recently, in December 2015, Elon Musk has also announced the creation of OpenAI, a not-for-profit artificial intelligence (AI) research company. It aims to develop artificial general intelligence that is safe and beneficial to humanity.
It wants to make AI available to everyone, and reduce the power from the corporations who own super-intelligence systems devoted to profits, as well as governments which may use AI to gain power and even oppress the people.
Overall – since the beginning, Elon has made a total of 20 investments that include – NeuroVigil, Vicarious, SolarCity, Stripe, Tesla Motors, OneRiot, Mahalo, SpaceX, Game Trust, Everdream, and PayPal.
And lastly, during his journey – the most important and valuable lesson that he has learnt and still follows is that….
“The most difficult thing in life will be to come up with the right questions!”