And I’d point out that the late 90s was very famously a time of stupid little companies getting stupid amounts of funding and later getting bought out for stupid valuations, so long as they did something on the internet.
It was certainly not a time when building such a company required “business acumen”, as was proven from 2001 to about 2005.
All on paper instead of what? Sitting in a giant money vault?
Elon Musk started his first company Zip2 with his brother and another guy for a couple hundred grand and grew it where they could sell it to Compaq for over $300 million (Musk received like $20 million).
Then Musk co-founded X.com (no relation to the current X) with $12 million of the money he made from the Compaq acquisition. Yada yada yada it became PayPal and was sold to EBay for $1.5 billion in stock, of which Musk received $175 million.
Musk founded SpaceX in 2002 with $100 million of his own money and became the company’s CEO and Chief Engineer. It’s now worth around $150 billion.
I mean for all I know Elon Musk sits in a room doing absolutely nothing but Tweeting for years and just gets credit while the company grows around him like Big Head on HBO’s Silicon Valley. But I doubt it.
Maybe there needs to be a larger discussion of what constitutes a “good businessman” and what that even means?
I mean that it’s in equity holdings where he is a major, if not the majority, stockholder. He is worth hundreds of billions, although he could never liquidate it for that amount because just the act of a major shareholder attempting to sell off that much stock would cause the price to plummet. Of course, this is true of all the uber-wealthy. My wealth is mostly on paper too, but I could sell it all today and get that paper value in cash without causing the least ripple in the market.
Thank you for putting this better than I have.
That “yada yada yada” is doing some heavy lifting. Under Musk’s leadership the company was failing. He was booted from the leadership role, and it was given to Peter Thiel that transformed the company into PayPal that was sold to eBay. There is no world where you can count PayPal as a Musk success.
During a tech bubble, with angel investors as noted above. No tech bubble and there’s no chance that Zip2 sells for that much. No where close. It is hard to say it would have sold at all. As pointed out previously, it is much easier to succeed in a bubble when you have the connections/money to take advantage of that bubble. Musk was lucky that Compaq got wrapped in hype of tech and overpowered by 100s of millions of dollars. Zip2 is not an example of a genius businessman.
Oh geez. Yeah, forgot about that part. Compaq buying Zip2 to attempt to bolster AltaVista…just as Google was taking off.
Compaq in the years around '99 made some terrible decisions like this. Which led to their “merger” with HP a few years later (and Carly Fiorina’s…contentious stint as CEO) and the discontinuation of the brand name a few years after that. I went to school in Houston around this time, and between Compaq and Enron and the dot-com bubble, a lot of friends experienced some lean years.
Musk made out pretty well on that one but, yeah, that was definitely one of those dot-com bubble deals that nobody would have made a few years later.
But, as above, you just need to have the one venture pay off, whatever the cause, and then it becomes a lot, lot easier
Admittedly I am not a close follower of Musk, but the impression I have is that he is someone who recognizes solvable problems. And addresses them, not always successfully.
I think maybe because people on the SDMB tend to be intelligent, liberal, and (based on this thread) don’t really make a lot of money they tend to have a blind spot when it comes to what businesspeople actually do and what actually makes someone a “successful” business person. And I think they generally find those people distasteful, Elon Musk in particular.
Maybe Elon Musk got lucky or maybe the stars aligned just right for him. But he started two companies SpaceX and Tesla for a $100M each from money he made in previous ventures. Those two companies are now worth a combined $900 billion dollars. Is that not indicative of some competency in running a business?
So what if he Elon didn’t invent the rocket ship or the electric car or he’s not in his home lab like Tony Stark personally cranking out new designs for Cybertrucks and Starship rockets? The reason “but he’s rich” is because of the companies he runs.
And as you say, Elon Musk sees problems and tries to solve them. And he has enough money that he can afford to pursue ventures that may not necessarily be profitable or within his particular wheelhouse.
Now as I understand it, The Boring Company mostly makes money from the design and sales of advanced Tunnel Boring Machines. The Hyperloop stuff is mostly speculative hype or proofs of concept and not the core business. But fine. Elon is interested in drilling big holes.
Twitter / X is another matter that seems to not play to Elon Musk’s strengths. I think you can be a bit of a mad scientist if the only thing that matters is if people like driving your cars or your rockets work. Something that’s very public facing like Twitter becomes more problematic if advertisers don’t want to be associated with the CEO’s particular brand of lunacy.
He did not start Tesla.
According to Musk, Tesla was one month from bankruptcy. If Tesla had gone bankrupt instead of surviving, then would you be here saying Musk was clearly not suited to running a car business? Does not being one month away from total destruction matter at all? Does not robbing people of a quarter billion in dollars in interest free funding at a time when his company needed it most not matter at all?
I don’t know I need to make this clear again, but I’ve never said that Musk is an idiot (beyond as a turn of a phrase like “OMG, what an idiot”). I’ve never said he has no business talent at all. What I have said is that Musk is not a genius. He’s not a rocket engineer. He’s not a visionary. He’s not a good leader. He’s largely failed upwards and/or been bailed out by others. He has one excellent talent. He’s very good at lying about his businesses in a way that people believe for some reason.
Let me put it this way. If somebody keeps winning races, but they keep getting a drive halfway to the finish line, and they constantly trip at the finish but they have somebody to pull them across, would you say “Man, what an amazing athlete!”?
Do I think Musk is an asshole? Oh boy. But that’s not the criteria for my assessment of him. I’m basing it on the totality of evidence. Certainly based on his recent behaviour, whatever talent, large or small, that may have once existed is gone. But Musk will be ok. He’ll never be us poor, but I think his days at the top of the heap are numbered. Unless of course somebody bails him out. Again.
According to Musk, Twitter was on the brink of doom too (it wasn’t). Until Musk got into AI, it was going to lead to the apocalypse. According to Musk everything’s in trouble until he shows up, no matter how often it looks like the reverse.
Tesla was originally a boutique car company making rich guy toys by converting Lotus Elises to electric. Singer rebuilds vintage 911s with custom engines and interiors, Icon restores old Jeeps and Land Rovers, Caterham does Lotus Sevens. Look at the books of any of such companies and none will seem like a viable business, despite a Singer 911 has a 2-year waiting list with a $2M price tag. Tesla was fine for the market they were in.
This was well after he showed up.
Musk is atypical.
But Musk is also a billionaire. Since businesspeople tend to not be particularly creative or intelligent, they tend to emulate him in hopes to replicate his success.
Oh of course.
My best friend is a vice president in tech in Silicon Valley and started a new job eight months ago, poached with a huge salary and bonuses. Only after he joined did he discover the CEO of the firm has consciously decided to be exactly like Elon Musk. It’s apparently HORRIBLE.
That poor guy. Is he putting an escape plan in place?
He’s interviewing elsewhere after the holidays. Tech VPs in Silicon Valley don’t lack for opportunities.
Good for him, getting out before that situation sucks his soul dry.