, Inspiration

What Entrepreneurs Can Learn From Elon Musk

Elon Musk – The Visionary

The founder of Paypal, Elon Musk has gone through tremendous success and horrible failures in his journey so far. Today, he stands at a juncture where he is changing how we perceive energy, and at the same time, he is giving us hope that someday soon we will be capable of space travel like never before.

 

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If you read his story from the beginning, there is a lot to learnt from him.

  • In 1983, at the age of 12, Musk sold a simple game called Blastar to a computer magazine for $500.
  • He was once hospitalized when a group of bullies threw him down the stairs and beat him until he blacked out.
  • While studying at the University of Pennsylvania, Musk and his fellow student Adeo Ressi rented out a 10-bedroom frat house and turned it into an official nightclub. It was an early entrepreneurial experiment.
  • After graduation, Musk traveled to Stanford University to study for his PhD. But he ended up deferring his admission after only two days in California, deciding to test his luck in the just-beginning dot-com boom.
  • Musk and his brother Kimbal took $28,000 of their father’s money and started Zip2, a web startup that provided city travel guides to newspapers like the New York Times
  • Compaq bought Zip2 in a deal worth $341 million in cash and stock, making Musk worth $22 million.
  • Musk started X dot com, an online banking company, in 1999. About a year later X dot com merged with Confinity, a money startup co-founded by Peter Thiel, to form a new company called PayPal.
  • In late 2000, Musk took his first vacation in a long time. While Musk’s flight was still in the air en route to Australia, PayPal’s board fired him and made Thiel the new CEO.
  • He stayed the single biggest shareholder in PayPal, netting him $165 million of the $1.5 billion that eBay paid for PayPal in late 2002.
  • A lifelong fan of science fiction, Musk conceived of a crazy plan to send mice or plants to Mars. He even tried to buy decommissioned Soviet missiles for that purpose. But the Russian sellers wanted $8 million or more for each, and Musk thought he could build his own cheaper.
  • So in early 2002, Musk founded the company that would be known as Space Exploration Technologies or SpaceX.
  • In 2004, he made the first of what would be $70 million of total investments in Tesla Motors.
  • Musk came up with the idea for SolarCity, a solar energy company designed to combat global warming.
  • Tesla was burning way more cash than it was taking in. In 2007, Musk staged a boardroom coup and took charge.
  • Musk invested $40 million into Tesla and loaned them $40 million more to save the company from bankruptcy.
  • between SpaceX, Tesla, and SolarCity, Musk actually ended up going broke. By 2009, Musk was living off personal loans just to survive.
  • Around the same time, Musk was going through a divorce with Justine Musk, a Canadian author, with whom he had six sons.
  • 2008, Musk got two pieces of good news: SpaceX landed a $1.5 billion contract with NASA to deliver supplies into space, and Tesla finally found more outside investors. Things were suddenly looking up again.
  • Tesla held a $226 million IPO by 2010, the first car company to go public since Ford in 1956. In that offering, Musk sold shares worth about $15 million to get his finances back on track.
  • By the end of 2015, SpaceX had made 24 launches on assignments like resupplying the International Space Station, setting lots of records along the way.
  • Even as he pushes for solar power, electric vehicles, and the colonization of Mars, Musk also designed what he calls the Hyperloop, a transport system that can get you between Los Angeles and San Francisco in 30 minutes.
  • In late 2015, Musk unveiled OpenAI, a nonprofit he co-founded to do research into making sure that artificial intelligence doesn’t destroy humanity.

Seems like a Hollywood movie on some rich and bad-ass guy, doesn’t it?

It is simply put Elon Musk’s life from which we can learn a lot of things like:

 

Listen to your instincts

His decision to leave Stanford University might have been viewed by many as a crazy act but Musk followed his instincts. Listening to one’s instincts is natural to everyone but we usually tend to curb down our natural thoughts owing to external response and stimuli.

Think beyond money

Whenever you decide to start something new, focus on the difference that your product can make to humanity. Money is a by-product and will come to you if you or your product can solve and help people with problems.

Always consider failure an option and plan ahead

When Musk started SpaceX, he considered failure as a viable option on his new journey towards interplanetary exploration. However, instead of giving it up, he created a contingency plan and went ahead with the SpaceX Project.

Challenge the norms

Before Tesla Energy came into existence, people were convinced that battery packs would continue to be expensive, no matter what. Musk innovated by breaking down batteries into its fundamental components: aluminum, cobalt, carbon, nickel, polymers, steel etc. He built them from scratch by optimizing the resources. There was a huge reduction in the overall margin the of the total cost involved.

Know what motivates you

Keeping your eye on the ball is key. After moving on from Paypal, he was concerned with what problems could affect humanity in the future and he decided to focus on them, instead of just making a lot of money.

Big Ideas Generate A Lot Of Attention

Elon Musk doesn’t come up with ideas that are easily achieved. I mean, starting your own space program for interplanetary travel sounds like a ludicrous idea, yet this man pulls it off and gets a $1.6 billion contract from NASA. If you want to get people invested in your idea and keep their attention on it, your idea needs to be very ambitious and worth their time.

Improve the Product, not the marketing

The bigger a company gets, the more it spends on marketing, and in some cases, their marketing budgets surpass the budget of any other aspect of their business. This means that you are investing more into improving promotion than in improving the quality of your product.

Be Comfortable with Change

You never know which challenges are going to arise. Successful leaders are able to adapt in any situation and continue pushing forward towards their team’s goals. Whatever comes their way, they understand how to enable their teams to leverage their strengths to find solutions and innovate.

Practice integrity

To develop his electric car company known as Tesla, Elon Musk borrowed heavily from the U.S. government. The company has become a huge success and is selling thousands of units. After making a good revenue, Elon paid back his $400 million loan. He said that he was grateful to the Department of Energy and all stakeholders who loaned him the money.

Embrace Your Worst-Case Scenario

What scares you most about failure? Often your idea of your worst-case scenario is what prevents you from truly succeeding. You think that it will be so bad that it’s not even worth taking the risk.

Elon Musk embraced his worst-case scenario early on in his entrepreneurial days. He forced himself to live off of $1 per day. By experimenting what it felt like to be poor and realizing he could handle it, he knew that money wouldn’t be an issue.

Don’t Rest on Your Laurels

There’s nothing wrong with taking some time to celebrate and enjoy your successes. But don’t take too long—always be looking to improve.

The real life Tony Stark is constantly striving to make the future better for his fellow humans, and that is the biggest lesson he teaches us all that we can imbibe ourselves with.

 

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