I’ll suggest that Musk, right now and as to X, is what happens when you give an autistic kid a playtoy perfectly suited for their idiosyncratic foibles. The kid just can’t quit fiddling with the whatever, and any attempt to interrupt the obsessive play is met with a screaming tantrum.
Add in LOT of drugs, some serious ego, and here we go.
My bottom line being that little of what’s going on at X now is part of how Musk got rich. Instead, this is how Musk will get his downfall. Like the arc of Howard Hughes, William Hearst, and even Hitler, there’s a peculiar restless genius that powers the rise, then all the plot holes in that strange mind take over and disaster follows as night follows day.
It’s been awhile since I graduated business school, but as I recall wealth is often considered pretty good evidence of business acumen.
I’m no Elon Musk fanboy, nor am I his biographer. But many of the activities you described:
Building companies from scratch
Profitably selling those companies
Securing funding
Marketing
Addressing gaps in the market (even if they are known)
…are all considered aspects of “business”.
A lot of people start businesses and dot coms. A lot of business people are also full of shit and act like jerks to their employees. Very few of them are billionaires. So I think the question is more what does Elon Musk do differently? And how does he achieve such success in spite of some of these behaviors?
By all accounts, Steve Jobs was also a raging asshole who was fired by the board from his own company and ultimately died for his belief in “medical woo” instead of getting proper treatment. So why does he get a pass?
Well, he created the company, then when it wasn’t perceived to be doing great, he was ousted, the company then floundered for 12 years, was near bankruptcy, and they hired him back. His involvement directly influenced the growth of Apple from that point to be worth about 3 trillion today.
In recent years, the more direct involvement Musk has, the worse things seem to be.
He’s smart about some things and an egomaniacal moron about other things. He knows what horse to bet on, but I don’t know of any concepts that he originated. He might know what kind of company to back, but has made some colossal management and PR errors. If he were really smart he would establish these companies and provide only visionary guidance and stay in the background while professional managers oversee operations and PR.
Musk is kind of like Mark Cuban writ larger and stupider.
Musk basically catapulted himself into extreme wealth in the very early 2000s by founding Zip2, which was the major competitor to CitySearch. The company was sold in 1999 for 300 million dollars.
He then went on to found x.com(yes, that was the site name) which was one of the two companies that merged to form PayPal (the other, Confinity, was founded by Peter Thiel). EBay bought PayPal in 2002 for 1.5 billion. So in 2002, he was worth many hundreds of millions of dollars, and from there, he’s founded/bought small companies such as Tesla and SpaceX.
He’s done pretty well, although a lot of that is due to crazy Tesla stock prices- until mid 2020, his wealth was a relatively stable 25-30 billion, but has gone up dramatically and in a very volatile fashion since.
Basically instead of settling down and becoming an investor like Cuban, he’s been balls deep in doing all sorts of vaguely crazy stuff in the public eye.
I look at people like Paris Hilton, Jessica Simpson, and Kylie Jenner who outwardly appear to be these completely vapid trust fund celebrity idiots. And yet they have been able to amass fortunes of hundreds of millions of dollars through media and business ventures.
Supermodel Kathy Ireland is worth over $400 million and it’s not just from Sports Illustrated swimsuit modeling.
This had already been discussed upthread, but it’s another version of assuming that wealth implies worth. Or that there must be some pro-active reason personal wealth increases.
But look at somebody like MacKenzie Scott. While instrumental in supporting Jeff Bezos so Amazon could get started, would not considered a business genius - known not to have been involved in the day to day to any great extent. And is known to have given away over $14 billion to charity over the last 3-4 years and is yet worth more now than before giving that money away.
For some versions of wealth, it is difficult to actually squander it all. Or rather, it builds upon itself even if you spend billions for no return.
Just because Musk has a lot of wealth and that wealth has had periods of significant grown is not directly indicative either for or against his business acumen. And yet that’s the first (and usually primary) argument people use in support of the idea he has some particular talent or insight for business.
Maybe not a “genius”, but I understand her to be a relatively skilled business woman. The “vapid socialite” persona is an intentional part of her public image.
At this point, I think maybe he’s just been lucky. I tend to think people underestimate how much luck is involved with business success. Maybe Elon has just been lucky.
You’ve stumbled across an acorn of truth here: think of Elon Musk as a celebrity rich person rather than a business genius and you understand how, as the thread title says, someone with no business acumen gets wealthy.
Tons of celebrities see tremendous success while people openly acknowledge they aren’t the best actors or singers, aren’t particularly stable, and/or have substance abuse problems. But millions of people like them and so they need a circular driveway so the trucks of money coming to their house won’t back up traffic.
Tesla’s a roaring success in terms of popularity. As a car line, the factories have labor problems, the cars have quality issues, there are product boondoggles (a phone? A robot?) and every analyst outside of Kathy Wood thinks the company is ridiculously over-valued when you consider its production and market share. But the CEO is a celebrity so support for the company is based on fan-club metrics rather than business.
You might also consider that Musk has gone nuts. Howard Hughes was a business genius at one time, too.
And I’ll mention here that Steve Jobs wasn’t so hot either. He started Apple as a computer company and couldn’t get it beyond single-digits in terms of market share. They found success as a consumer electronics company making mp3 players, which blew up when they combined them with a phone. The iPod was thought up by a guy named Tony Fadell, with Jobs chiming in on design to make it fit Apple’s aesthetics.
I don’t know it’s sheer luck, but his wealth is nearly all on paper from his ownership of Tesla and SpaceX. It’s not that he’s had dozens of successful ventures. He hit it big on these two. He didn’t invent the electric car, or even start Tesla. He was probably instrumental in the success of SpaceX, which I have not studied.
I find it a little hard to believe that any business school would teach that wealth is an indicator of business acumen. Although I guess it is possible since that’s mainly a societal problem. Wealth = intelligence/ability (and often value as a person). It is silly that people treat money as a scorecard, but what can you do. As others have pointed out luck is a major factor, and for better or worse (narrator: It was worse) Musk has been very lucky.
I’m not giving Jobs a pass as an asshole. I’m saying that Jobs has a proven track record of success and you can point directly to his actions for that success. I didn’t say anything in reply to you about Musk being an asshole. He is an asshole, but that’s not relevant to his business acumen. It is certainly relevant for him to be telling his advertisers to go fuck themselves. You went to business school, does that seem like a good idea or a bad idea? The evidence suggests that Musk is the poster boy for failing upwards. He would hardly be the only person in history for this to be true but it is true for Musk. If we lived in a world where talent and intelligence were actually required to be wealthy, then Musk would not be one of the richest people in the world.
And a reminder that there’s a broad expanse between “genius” and “NO acumen” – and that the “celeb entrepreneur” does have a skill set, which is to capitalize on the image.
And there’s that, too. But one then wonders if this is a case of something emergent or something that was always there and was glossed over by the successes.
True, and I don’t think he’s stupid. I think he knows what ideas are going to take off, but is not a good business manager. He has done some stupid things, like when he made public statements about a deal to sell Tesla that got him in trouble with the SEC, and has been spectacularly indiscriminate about his tweets. I consider “business acumen” to mean “know how to run a business” and I don’t think he’s got a lot of that. I think he has a lot of “big-picture vision.”
Agree with the first part (though it’s usually hyperbole - most of his detractors don’t think he’s actually stupid - just not the ‘genius’ many claim)
Strong disagree with the second statement. Boring Company? The insistence on the whole x.com nonsense with Paypal? This current Twitter/X debacle and this push for a universal app?
He clearly does not have any special ability to determine what ideas are going to take off. But, as repeatedly stated above, what he does have is the wealth to try several different ideas and having the few successes more than make up for the failures.
This is one key area where he differs from most people. Most people struggle to raise enough money to try out one idea. The very fortunate can maybe save up to fund 2 ventures. He’s never had to worry about getting several different ventures funded. If you just need one to succeed, then the ability to roll the dice multiple times is the most important factor.
At this point, this is very clearly true. Even at Tesla and SpaceX, the day to day business operations are left in more capable hands. He gets credit for leaving the right people in place but that requires no special business acumen
There’s a saying about this - “Ideas are a dime a dozen”. A lot of people have “big picture vision”. Most of that vision is about as useful as the visions you get from hallucinogens. Where companies often succeed or fail is executing that vision if it is even any good in the first place.
Everybody probably has that cousin or uncle or friend who has the latest revolutionary idea that would make a billion dollars if only they could get some startup money. There’s no shortage of “big picture vision” in the world.
But it seems that most of his current wealth is from Tesla holdings. I know he came from a well-to-do family, but not billionaires. How did he get started?
You don’t need billions to simply get started. Why would that even be necessary? Even a few tens of thousands work for most people.
That first successful company (that eventually became/absorbed into Paypal) was funded by a group of angel investors to the tune of a few hundred thousand dollars. His father was one of them, to the tune of about $20,000 (the exactly amount is unknown - Elon not really wanting to admit he got help from his dad) plus at least a couple hundred thousand from others. And then as they got going, a few million from other angel investors in a later funding round.
This is where connections help, of course. But most people don’t have connections to angel investors to raise even $10,000 much less 10-20x that or 100x that. And even if he lost all that, it did not matter to him. It wasn’t his money. He could try again with a different ventures several more times until one paid off.
And once he made a few million from that himself, he had the money to try a few others things personally, most of which didn’t really work out, but one of which, Tesla, really paid off. And that paid for the rest.
Starting from wealth just really helps jumpstart things. You can either have direct access to wealth or access to people willing to stake you, usually because you or your family have money to begin with.
ETA: Again, this falls into a very common mode of thinking that the mere possession of wealth leads people to think that the possessor of that wealth must have done something special or had some special quality to “deserve” it. Take the moral dimension out of it, and having wealth just means having wealth. Some people who have vast wealth are brilliant. Others are not. But the mere possession of wealth does not by itself imply genius or idiocy. Better to judge that by their actions, not merely the fact their personal wealth experience tremendous growth over a short period of time.
