Elon Musk’s Success

Wednesday, December 16th, 2015

Elon Musk has been asked many times to explain his success, and occasionally he has tried:

He points to things he does that other people don’t do — actively seeking out negative feedback, for instance, and working really, really, really hard. But I think he knows that he’s different. This is what he said once to NPR, back in 2007, before the first Tesla car hit the road, before the first SpaceX rocket took off: “What I’m good at is, well, I think I’m good at inventing solutions to problems. Things seem fairly obvious to me that are clearly not obvious to most people. So…and I’m not really trying to do it or anything. I just, I don’t know, I can see the truth of things, and others seem less able to do so.”

Eight years later, he tries to boil down some more practical lessons for me.

The things you’ve been working on the last ten years or so, would they be where they are now yet without you?

“Which things?”

Everything you’ve been doing at SpaceX and everything you’ve been doing at Tesla.

“Would they happen without me? Um, certainly some things wouldn’t have. You know, I think probably not.”

So what is that that you’re doing to make that happen?

“Well, you’ve got to convince great people to join the companies and then get them to work together in concert toward a clear goal with a strategy that’s sensible.”

But surely there are thousands of people who are doing that. Why are you more successful than pretty much anyone else right now?

“Well, it’s really because people, they either have a strategy where success is not one of the possible outcomes — occasionally it’s that. And then they don’t change that strategy once that becomes clear, amazingly. Or they cannot attract a critical mass of technical talent, if it’s in a technology-related thing. Or they run out of money before reaching a cash-flow-positive situation. That tends to be what occurs.”

Sure, but even so, there’s other people who get over all those bars…

He laughs. “No, they don’t. There’s very few.”

You really think those hurdles are enough to stop nearly everything?

“Oh yeah, absolutely. Probably very often when a company starts out, it’s headed in the wrong direction. But it really depends on how quickly it can recognize that and take corrective action. But people tend to think that they’re right even when they aren’t right.”

An essential part of the Elon Musk tale of triumph is how close he came himself to complete disaster in the second half of 2008. “Yeah, we had some really, really hard times,” he says when I refer to this, “and very narrowly escaped death as a company, both for SpaceX and Tesla.” He has told the full story over and over — how SpaceX had failed with its first three rocket launches and Tesla was struggling to make vehicles quickly or economically enough, and how, when the wider market crash then came, both companies were only kept going by Musk committing the remainder of his $180 million fortune from PayPal, to the point where he was reduced to borrowing money off friends for living expenses. And how, at the last minute, doom was averted: The fourth SpaceX launch reached orbit, and the company was awarded a $1.6 billion NASA contract; other Tesla investors agreed to match Musk’s final $20 million investment and saw them through the most vulnerable moments.

Comments

  1. Slovenian Guest says:

    Two words come to my mind: hype, and momentum!

    Like it was said in this Model S production documentary, “Teslas solution to improving battery life appears startlingly simple,” disappointing even! The magic sauce is simply thousands of Panasonic 18650 3400mAh lithium-ion cells, which look almost like regular heavy duty AA batteries. The motor is nothing special either; it’s a standard three-phase alternating-current (AC) induction motor.

    Now who wants a monorail, I mean hyperloop?

  2. Dan Kurt says:

    Musk defines the term Crony Capitalism.

  3. A startlingly simple solution for electric cars, and SpaceX uses rockets that are in all but details identical to the disposable, staged rockets that have been in use since the 1950s.

    Yet, no one made a usable electric car before Tesla, and no one can make disposable rockets as cheaply as SpaceX — and they’re close to making them significantly less disposable. Why did no one else do this before Musk?

  4. Stephen Gustav,

    The electric vehicles I can’t speak to, but when it comes to the rockets a lot of what SpaceX has done has been to grab many of the paper and experimental-but-not-production ideas that have been floating around for decades and actually render them in metal. SpaceX’s production design is also substantially different from that of their competitors.

    The reason no one’s done it before is because there was no strong incentive to do so. The launch market is small (in terms of numbers of launches), so there’s a point before which making your rockets cheaper does nothing but eat into your profits.

    Musk is making a bet that the demand is elastic and that if he can provide more and cheaper rocket launches, business and government will find more things to put in space. He’s probably right, at least to some extent. The question is whether he’s right that there’s the potential for orders of magnitude of growth.

    I certainly hope so. I think we’ll get to see, which is certainly not something I could have said 10 years ago.

  5. Roger says:

    As far as the electric car market check your history. The electric car market outsold the internal combustion engine for a few years in the beginning of the private car market.

    As far a Elon and SpaceX go he is no more than a rent seeker. I hear many claims but have never seen any evidence that the claims are true…

  6. I hear many claims but have never seen any evidence that the claims are true…

    https://www.youtube.com/watch?v=YvQ-BTwI_II

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