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Key insights from
Elon Musk: Tesla, SpaceX, and the Quest
for a Fantastic Future
By
Ashlee Vance
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What you’ll learn
Elon Musk is a complicated man. Reactions to the
entrepreneur run the gamut of fear, frustration, admiration and loyalty.
His intrepid entrepreneurial spirit helped him revolutionize multiple
industries, but his successes did not come without a cost. Charting Musk’s
path from childhood to his early startups to his now-booming businesses,
Ashlee Vance’s portrait of Musk gives us the major factors that have
contributed to the making of Musk.
Read on for key insights from Elon Musk.
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1. Young Elon Musk
was a bright know-it-all with very few friends.
From an early age, Musk was committed to doing great things
for humanity. As a boy, he had a knack for picking things up faster than
most of his peers. This did not endear him to his classmates. His habits of
fact-checking people and spacing out in social settings often landed him at
the social periphery. Musk’s mind would (and continues to) wander to places
far from his immediate context, where he would construct detailed images
with crystal clarity.
Musk was a far cry from the masculine ideal encouraged in
his hometown of Pretoria, South Africa. He preferred computer codes, sci-fi
novels, and encyclopedias to sports. By fourth grade, he had read every
book in his school’s library and had to convince the librarian to order
more books.
He was close to his siblings and cousins, but he did not
make friends readily. His geeky, loner tendencies made him a prime target
for bullies. One beating was so severe that he spent a week in the
hospital. Some of these memories are still painful for Musk to recall. So
he doesn’t. He remains uncompromisingly forward thinking, and considers
dwelling on the past an exercise in futility.
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2. Musk showed his
self-reliance, resourcefulness, and ambition as a young man when he moved
to Canada and got by on his own.
Musk’s grandfather, a successful Canadian chiropractor,
along with his grandmother, moved to South Africa after growing disgusted
with Canada’s mushrooming bureaucracy. It was in their small, single-engine
plane that they scouted out the location where they would eventually settle
and build a home in Pretoria. Always hungry for adventures, Elon’s
grandparents would often fly their plane to Europe, Africa, and Australia,
taking Musk’s mother and her siblings along for the ride.
Elon took up the family mantel of risk-taking and
adventure-seeking when he left South Africa for Canada after high school.
He saw Canada as a stepping-stone to the United States, which was, to young
Musk’s mind, the only place where dreams as gargantuan as his own could
come to life.
Musk didn’t have a well-developed plan when he decided to
move to Canada at seventeen. He had a plane ticket, a suitcase, and a dream
of making it to the United States. Canada seemed the best path because of
his family roots. He contacted a great-uncle when he arrived in Montreal,
but his uncle had moved to the United States. After a frenzy of phone calls
to relatives and a 2,000-mile bus ride to Saskatchewan, he ended up at his
second-cousin’s home, where he made a living farming and shoveling
hazardous waste in a boiler room.
Eventually, Musk enrolled in Queen’s University in Ontario.
It was here that Musk met Justine, who would later become his first wife.
She was cool and hip. Elon was neither, but he was bold and persistent, and
eventually won her over. It was at Queen’s that Musk finally found people
who did not mock his opinions or ambitions. Musk went on to complete his
undergrad at the University of Pennsylvania, where he completed a degree in
physics as well as a business degree from Wharton. At U Penn, Musk began to
take his love for science and ground it in business proposals that often
impressed his Wharton professors. He was passionate about making science a
profitable endeavor.
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3. Musk’s first
startup was profitable, but the experience taught him some hard lessons.
Musk’s graduation in the mid-90s coincided with the advent
of the internet. Like many other young entrepreneurs, Musk and his brother,
Kimbal, moved to Silicon Valley in the hopes of getting in on the dot-com
boom.
They began developing a business they eventually called
Zip2, a rudimentary blend of Google Maps and Yelp features. They rented a
small office space, and this was where they worked and slept. They showered
at a nearby YMCA, and relied on Jack-in-the-Box for quick, consistent
sustenance. Twenty years later, we take it for granted that a pizza place
or auto dealership can generate traffic through creating a presence online,
but the internet was still novel in 1995, and few people understood how it
actually worked. Many businesses were suspicious and hesitant to work with
Elon.
Elon, Kimbal, and a handful of engineers started to generate
some interest through door-to-door sales, but the real breakthrough came
when they connected newspapers to their services, allowing newspapers to
map out businesses in their own municipalities with the technology that
Musk had developed. Under a new partnership with some venture capitalists,
Musk relinquished his role of CEO and headed up tech development instead, a
decision he later regretted.
The Zip2 venture was a formative one for Musk. It was a time
of learning lessons in leadership and empathy. A loner growing up, he had
never learned to be a team player—let alone lead a team—so dealing with
people was a challenge.
He would often mistreat and micromanage employees. It was
not uncommon for him to rewrite codes of underlings and he sometimes came
off as a know-it-all to older, more experienced businessmen, brusquely
pointing out what he considered flaws in their ideas.
Musk would later attempt a takeover of the company but
failed to convince the board to restore his CEO title. He was demoted
instead. Zip2 began floundering after a failed merger, but when Compaq
Computers bought it for over $300 million, Musk walked away with a hefty
$22 million. With that, he began to set his new business ideas into motion.
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4. Musk ignored
naysayers and cynics in his audacious pursuit of privately funded space
exploration.
Musk’s pioneering work in online banking began as X.com and
eventually became PayPal. Though ousted from his position as CEO, he made
the level-headed decision to keep his money in the company. It paid off
when eBay acquired PayPal for $1.5 billion. Musk ended up with $180
million—after taxes.
Musk concluded that online banking was too narrow a venture.
As he researched, he was shocked to discover how unambitious NASA was in their
space exploration plans. He decided to take up the challenge himself. His
new plan was to get the public excited about space exploration again, to
revitalize the ideals of conquering new frontiers and maximizing human
potential. Musk formed the Life to Mars Foundation, and gathered his
growing network of space enthusiasts, scientists, and potential investors
to design a space-related project that would make waves. The original idea
was what Musk called the Mars Oasis project, which would involve agricultural
pursuits on Mars.
Musk flew to Moscow with an old college friend and a former
U.S. intelligence operative with intent to buy intercontinental ballistic
missiles from Russians. Apparently there is now a market for such things in
post-Soviet Russia. When the Russians charged exorbitant rates and refused
to take young Musk seriously (he was in his late twenties at the time),
Elon stormed out and decided to build a rocket himself.
For Musk, this would be the project that would get the
public’s attention and stoke the dying embers of optimism about human
potential for a new generation: making space flight more affordable. Musk’s
enthusiasm met with criticism and condescension. It was the all-too-common
story of a millionaire trying to break into the space frontier until he got
bored or went broke. Still, Musk persisted, pouring millions of his own
capital into SpaceX, determined to show the world that a private company
can produce rockets of better quality and deliver payloads at far more
affordable rates than Boeing, Lockheed, and other nation-states like Russia
and China. Musk was utterly convinced that his Falcon 1—a nod to the
Millennium Falcon of Star Wars—would reach space within a few
years.
After two unsuccessful launches and money running short, Elon
needed his third and final launch (literally) to take off. Both
SpaceX and Tesla (Musk’s automotive startup) were in danger of going under
and garnering scorn and satire from Silicon Valley’s gossip columns and
news outlets.
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5. SpaceX and
Tesla upgraded Musk’s image, but at significant personal cost.
When the filming of Iron Man began in 2007, actor
Robert Downey Jr. got wind of a modern-day Tony Stark down the road in
Hawthorne, CA, just outside Los Angeles. Downey met with Musk at the SpaceX
factory and found Musk inspiring. Downey even suggested that a Tesla be
included in Toney Stark’s lab to give the appearance that Stark was ahead
of the tech curve. In interviews, Iron Man’s
director went so far as to say that Musk was a huge
inspiration for Downey’s take on Tony Stark. This comparison was certainly
overdrawn, but it did boost Musk’s public image.
For a time, Elon and Justine enjoyed the high life in LA,
rubbing shoulders with celebrities and attending exclusive parties. With
Musk dedicating the lion’s share of his time to keeping two struggling
companies afloat, his relationship with Justine began to sour. Upon moving
into Beverly Hills, Justine had enjoyed blogging about the couple’s
adventures in paradise, but then her blog posts started to tell a different
story. The couple got a divorce, which became yet another complicating
factor for Musk, who was fighting an uphill battle against the effects of
the Great Recession in 2008.
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6. Musk’s SpaceX
efforts have shaken up the status quo and modernized an antiquated
aerospace industry.
Normally, national governments fund rocket science. Musk,
however, assembled a team of 500 people that successfully sent a rocket
into orbit without any government aid. The Falcon 1’s third launch was a
success, and a tear-filled moment of victory for all who had been involved.
SpaceX has continued to build on its initial achievements, constantly
updating designs and creating new technologies. The company is no longer
the butt of jokes but an aerospace giant that regularly sends payloads to
the International Space Station—and, as promised—for far less than
competitors.
Musk’s childhood penchant for acquiring knowledge followed
him as he learned all he could about aerospace and related technology.
Instead of inhaling books, as he did when the company started, he began
cornering engineers at the factory to learn all he could from them. His
ability to absorb, understand, and recall information clearly is a talent
many of his employees have noted.
Another talent of Musk’s—and perhaps one of his more
controversial—is his ability to maximize people’s productivity. Ninety-hour
work weeks is a norm at SpaceX. The people who are not up for the challenge
are weeded out quickly. If someone tells Musk that it is impossible to
complete a task within the Musk-given time constraints, Musk will usually
fire him on the spot, take on those responsibilities, and complete the task
in the timeframe he set for the ex-employee—all while running two
companies.
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7. If not for a
last-minute surge in sales that boosted the company’s stock, Musk might
have sold Tesla to Google.
As with the aerospace industry, Tesla’s innovations have
rocked the automotive world. The Model S, released in 2012, outpaced
competitors in more than just the traditional categories of extra leg space
and cup holders. Because Tesla’s vehicles run on a battery placed near the
car’s center, there is not just trunk space, but also storage in the
“frunk” (i.e., front trunk). The non-traditional placement of the heaviest
equipment actually provides better balance and performance as well. The
Model S is a sedan with supercar capabilities, accelerating from 0-60 in
less than 4 seconds.
Another feature that sets Tesla’s cars apart from
competitors is that instead of taking a car to the mechanic, most issues
can be resolved remotely through software tweaks and updates. A Tesla owner
with finicky windshield wipers can report the problem to tech specialists
in the morning and return to perfectly functional windshield wipers later
that afternoon without ever taking it to a shop.
Even the fickle journalists and critics raved about the
Model S when it came out.
The tune of mainstream car companies changed from
dismissiveness to discomfort as Tesla began winning awards and a level of
critical acclaim rarely bestowed upon vehicles. When you get record-high
ratings and unanimous Car of the Year votes, you’re doing something right.
After numerous near-crash-and-burn moments, the company came
back from a harrowing 2008 to work out the kinks and design issues in the
years that followed. By 2013, just a year after the Model S’s release,
Tesla’s numbers were rivaling those of other major car manufacturers.
Despite rave reviews, finances became dire in 2013 when
Tesla struggled to produce enough cars to keep up with the burgeoning
demand. This inability to deliver cars to those who had pre-ordered did not
inspire his clientele’s confidence. While people were putting down an
initial $5,000 to pre-order a vehicle, they were not confident enough in
Tesla’s ability to deliver to put down any more than that. The problem was
that Musk needed the payments in full in order to deliver final products.
Musk enlisted his designers and engineers to become full-time salesmen,
urging them to secure as many sales as possible.
Musk did not want to sell Tesla because that would mean
giving up control of the company’s overall direction and mission. With
funds evaporating, though, selling the company looked like the only way
that Musk could keep the company alive. He began having conversations with
Google CEO Larry Page about Google’s acquiring Tesla, to the tune of $6
billion. Musk did request that Tesla remain in his control for the next
eight years, a proposal that Google’s lawyers were hesitant to agree to.
While the attorneys were deliberating, Musk’s makeshift sales squad sold a
miraculous number of vehicles, fueling unexpected revenues that left the
public and Wall Street in shock as Tesla stock surged.
In the end, Google’s fence-sitting kept Tesla in Musk’s
control.
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8. Musk has
restored faith in innovation by showing that technology can still advance
quickly, even this late in the game.
The conventional wisdom about technology is that the major
contributions and discoveries have already been made. If we conceive of
technology’s progression as a tree, we long ago scaled its trunk and main
limbs and are now working our way toward the outer branches. With
electricity and the motor and digital technology, we are moving swiftly
toward the end of life-changing inventions and discoveries. What remains
are not discoveries, but innovations—making preexisting technologies more
sleek and efficient.
Elon Musk has managed to overturn the conventional wisdom
with his innovations in the space, energy, and automotive industries.
Unlike many innovators who were content to make minute changes and operate
within the accepted norms at the final branches of the tech-tree, Musk has
gone out on new limbs, and looks like he has no intentions of stopping.
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Endnotes
These insights are
just an introduction. If you're ready to dive deeper, pick up a copy of Elon Musk
here. And since we get a commission on
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