Business

How Did Elon Musk Get Rich?

Elon Musk is a South African born American business mogul and entrepreneur who established X.com in 1999, which later became known as PayPal. Moreover, he established SpaceX in 2002 and Tesla Motors in 2003. Musk turned into a multimillionaire in his late 20s when he sold his new business, Zip2, to a division of Compaq Computers.

Musk stood out in every headline in May 2012, when SpaceX dispatched a rocket that would send the first ever commercial vehicle to the International Space Station. He reinforced his portfolio with the acquisition of SolarCity in 2016, and established his remaining as a head of industry by taking on an advisory position in the beginning of President Donald Trump’s administration. How did Elon Musk get rich?

During the global coronavirus pandemic, Elon Musk has made more money than any other billionaire, which has increased his net worth more than three times in the past five months. This has currently made him the fourth richest person in the United States.

Elon Musk Biography

Early Life

Elon Musk was born on June 28, 1971, in Pretoria, South Africa. As a kid, Musk was so lost in his fantasies about inventions and technology that his parents and doctors requested to have his hearing checked. He was almost 10 years old when his parents got divorced, and it was around that time that Musk built up an enthusiasm for personal computers. He taught himself how to program, and when he was just 12 years old, he sold his first software: a game he made called Blastar. In grade school, Musk was short, introverted and erudite. He was bullied until he was 15 year old and went through a growth spurt and figured out how to defend himself with karate and wrestling.

Musk’s mom, Maye Musk, is a Canadian model and the oldest lady to star in a Covergirl campaign. At the point when Musk was growing up, she maintained five sources of income at one point to uphold her family. Musk’s dad, Errol Musk, is a rich South African engineer. Musk went through his youth with his brother Kimbal and sister Tosca in South Africa.

At the age of 17, in 1989, Musk moved to Canada to go to Queen’s University and stay away from obligatory service in the South African military. Musk acquired his Canadian citizenship that year, to some extent since he felt it was simpler to get an American citizenship through that way. In 1992, Musk left Canada to consider business and physics at the University of Pennsylvania. He graduated with a college degree in economics and remained for a second bachelor’s certification in physics.

Subsequent to leaving Pennsylvania, Musk made a beeline for Stanford University in California to seek a PhD in energy physics. Nonetheless, his move was planned impeccably with the Internet blast, and he dropped out of Stanford after only two days to become a part of it, dispatching his first company, Zip2 Corporation in 1995. Musk became a United States resident in 2002.

Professional Life

When Zip2 was established and was just in its initial stages, Musk used to live in the office and showered at a local YMCA. However, when Compaq bought Zip2 for $341 million in cash and stocks, resulting in Mush earning $22 million and becoming a multimillionaire, his efforts and hard work paid off.

His next venture was X.com, which was an online banking company. In 1999, using $10 million he got from the Zip2 sale money, Mush founded X.com. Approximately a year after its establishment, X.com joined forces with Confinity, a financial startup cofounded by Peter Thiel, to form PayPal.

Musk was named the CEO of the newly formed PayPal, however, it did not last for a very long time and ended up in a mess for Musk. In October 2000, musk began pressuring the company to shift its servers from the free Unix operating system to Microsoft Windows. This resulted in a huge fight among the PayPal co founders and the CTO at that time, Max Levchin, pushed back harder.

A few months later, somewhere near the end of the year 2000, while he was in Australia for a much needed holiday, PayPal’s board fired him and Thiel became the new CEO. In an interview with Fortune, Musk stated, “That’s the problem with vacations”, as he remembered that time and trip.

Luckily, in late 2002, things finally seemed to take turns for the better when eBay bought PayPal. As PayPal’s single biggest shareholder, Musk bagged $165 million of the $1.5 billion price eBay paid.

For a long time, from even before the PayPal deal, Musk was thinking of his next course of action, which involved a wild plan to send mice or plants to Mars. During the beginning of  2002, Musk established the organization that would be known as Space Exploration Technologies, or SpaceX, with $100 million of the cash he got from the PayPal deal. Musk’s objective was to make spaceflight less expensive by a factor of 10.

The song “Puff the Magic Dragon” was the inspiration behind another early vehicle. The name of the shuttle, the Dragon, was Musk’s poke at cynics who revealed to him SpaceX would be unable to place vehicles into space.

SpaceX’s drawn out objective is to make colonizing Mars more easy and affordable. Musk has said that SpaceX would not record for a first sale of stock until what Musk calls the “Mars Colonial Transporter” is flying routinely.

Musk has likewise been keeping himself occupied here on Earth as well, especially with Tesla Motors. In 2004, Musk made the first of what might be $70 million of absolute investments in Tesla, an electric vehicle organization that was co-founded by veteran startup executive Martin Eberhard.

Musk played an active, functioning product role at Tesla, assisting in building up its first vehicle, the Roadster. The all electric Roadster appeared in 2006, when Musk was filling in as Tesla’s chairman. He’s presently also its CEO.

As though that was not sufficient, Musk concocted the idea for SolarCity, a sunlight based energy organization. Musk gave his cousins Peter and Lyndon Rive the working funding to get SolarCity off the ground in 2006. In late 2016, Tesla purchased SolarCity in a $2.6 billion arrangement.

In 2008, Musk once again faced some hardships when the financial crisis within Tesla seriously restricted his options. This resulted in Musk personally pulling Tesla out of bankruptcy by investing $40 million in Tesla and giving the company an extra $40 million as a loan. Not coincidentally, he was promoted to be the company’s CEO the same year.

However, between SpaceX, Tesla, and SolarCity, Musk almost went broke. In one of his interviews, he describes 2008 as “the worst year of my life”. Tesla kept on losing money and was falling into a deeper financial crisis. On the other hand, SpaceX was having trouble launching its Falcon 1 rocket, which by 2009, resulted in Musk living off personal loans just to survive.

Some time around Christmas in 2008, Musk got two pieces of excellent news: SpaceX had reached a $1.5 billion agreement with NASA to send supplies into space, and Tesla at last discovered more external investors to support them financially.

By June 2010, Tesla held a fruitful first sale of stock. The organization brought $226 million up in the IPO, turning into the first vehicle corporation to go public since Ford in 1956. To get his funds in the groove again, Musk sold about $15 million worth of shares in the contribution.

Musk’s phenomenal career was beginning to get seen in different circles, as well, most outstandingly in Hollywood. Robert Downey Jr’s. depiction of Tony Stark in the “Iron Man” films is somewhat partially, if not completely based on Musk. the Tesla founder even had a small appearance in “Iron Man 2.”

Before 2015 ended, SpaceX had made 24 dispatches on tasks like resupplying the International Space Station, establishing heaps of precedents en route. In 2016, the SpaceX Falcon 9 made the first ever fruitful ocean landing of a reusable orbital rocket.

In February 2018, the Falcon Heavy, which came as a replacement to the Falcon 9 and is the most remarkable rocket SpaceX has worked to date, finished a successful first launch. The Falcon Heavy carried an interesting payload: a dummy named “Starman,” and Musk’s own cherry red Tesla Roadster, which were dispatched toward the Martian orbit.

Musk cannot quit concocting new plans and ideas, either, similar to the Hyperloop. A super-fast train that moves in a vacuum tube, the Hyperloop could hypothetically move travelers from Los Angeles to San Francisco in a short time. In a comparable vein, Musk began another organization in 2016 called The Boring Company, which has a mission to dig up a network of passages under and around urban areas for rapid, no-traffic driving.

Furthermore, in late 2015, Musk helped to establish OpenAI, a charitable, non-profit organization, committed to exploring man-made artificial intelligence and guaranteeing it doesn’t pulverize humankind. Moreover, as of late, Musk declared he was venturing down from the board of OpenAI in February 2018 to dodge any expected irreconcilable circumstances with Tesla, which has gained ground into artificial intelligence for its self-driving vehicle innovation.

Musk established one more organization, this one in 2017: Neuralink, which is attempting to manufacture gadgets that can be embedded inside the human cerebrum. The year 2017 was somewhat rough from a political angle also. Musk joined President Trump’s business advisory council, a move which caused a tremendous public backfire. He at first defended his move, yet he quit after Trump hauled the United States out of the Paris Agreement on environmental change. Musk said he did whatever it takes not to pull back.

In 2018, Musk got into some trouble when he tweeted that he was planning on taking Tesla private at $420 per share and had already secured funding. A few days after his tweet, the SEC sent Tesla subpoenas about the company’s ideas to go private and Musk’s comments.

By September, the SEC had officially documented a claim against Musk, blaming him for making “false and misdirecting statements”. Musk settled with the SEC, which resulted in both him and Tesla paying a $20 million fine and Musk consenting to venture down as director of Tesla’s board. Moreover, Tesla was also needed to delegate a board to manage Musk’s communications.

In November 2019, Musk released another Tesla vehicle: the Cybertruck, Tesla’s first and exceptionally envisioned pickup truck. Presently, on account of Tesla’s stock flooding in 2020, Musk is the seventh wealthiest individual on the planet with a total net worth of $82.2 billion. Musk’s riches have surpassed Larry Page, Larry Ellison, and Sergey Brin, as per Bloomberg’s Billionaires Index.

Personal Life

During the time when Musk was in a crisis with Tesla and SpaceX, his own personal life was in a state of chaos as well: him and his wife Justine, a Canadian writer, got separated in 2008. The couple got hitched in 2000 and their first child, Nevada, died because of SIDS at 10 weeks old. They later proceeded to have twin and triplet boys).

Musk began dating actress Talulah Riley soon thereafter. They proceeded to get hitched in 2010, but then separated in 2012. In July 2013, they remarried. In December 2014, Musk petitioned for a separation however pulled back the paperwork. In March 2016, Riley petitioned for legal separation which was then settled in October.

Musk began dating the “Aquaman” actress Amber Heard. However, the two broke up in 2017 after they had been dating for a year. In an interview with Rolling Stone Musk stated that the separation was exceptionally hard on him.

Musk’s personal life saw another advancement in the spring of 2018 when he and the musician Grimes started their relationship. They apparently hit it off after the two of them poked a similar geeky joke at artificial intelligence. Grimes dropped a massive headline in January 2020 when she posted a photograph of herself where she seemed pregnant. The artist later affirmed that she was anticipating a child with Musk.

Grimes gave birth to a baby boy on the 4th of May and the couple apparently named him ‘X Æ A-Xii Musk’, or “X Ash A-12 Musk.”

In spite of having a considerable real estate portfolio, Musk as of late said that he “will own no house” and would sell practically the entirety of his physical belongings. He has since recorded two of his Bel Air homes and five additional properties worth over $100 million.

Elon Musk Education

For five months, while anticipating Canadian documentation for residence, Musk went to the University of Pretoria. Once in Canada, he got admission in Queen’s University in 1989. He did this in order to avoid compulsory service in the South African military. He left the university after three years in 1992 to pursue economics and physics at the University of Pennsylvania from where he graduated in 1997 with a degree in Bachelor of Science in economics from the Wharton School and a degree in Bachelor of Arts in physics from the College of Arts and Sciences.

In 1994, Musk held two summer internships in Silicon Valley. One of them was at a startup based on energy storing which was called Pinnacle Research Institute. The institute explored electrolytic ultracapacitors for storing energy. The second was at the Palo Alto-based startup known as Rocket Science Games. Bruce Leak, the previous head engineer behind Apple’s QuickTime who had recruited Musk, noted that Musk “had boundless energy. Kids these days have no idea about hardware or how stuff works, but he had a PC hacker background and was not afraid to just go figure things out.”

In 1995, Musk got admitted to a Ph.D. program in energy physics/materials science at Stanford University in California. While he was in California, Musk endeavored to find a new line of work at Netscape, yet never got a response to his job requests. He was eager to look for various opportunities when the Internet fired up. Musk dropped out of Stanford, choosing to launch an internet startup.

Elon Musk Children

He had his first son with his then wife Justine in 2002 and they named him Nevada Alexander Musk. Unfortunately, Nevada died when he was 10 weeks old, also in 2002. Elon and his partner Justine the hand twin boys, Griffin Musk and Xavier Musk, conceived in 2004, by means of IVF. Their triplets Kai Musk, Saxon Musk and Damian Musk, were conceived in 2006, also by means of IVF.

In May 2020 Elon declared the birth of his son on Twitter, who he had with his girlfriend, musician Grimes on the 4th of May. As per Musk and Grimes, his name was “X Æ A-12 Musk” articulated EKS-ash-AY-twelve, and is inspired by the name of Grimes’ album 4ÆM.

However, the name was regarded illegal under California law, since it contained characters that are not in the modern English alphabet, it was then changed to “X Æ A-Xii”. This drew in more confusion, as Æ isn’t a letter in the modern English alphabet. At the end, the child was named “X AE A-XII”, with “X” as a first name and “AE A-XII” as a middle name.

Elon Musk Net Worth

As of now, Elon Musk’s net worth is 93.7 billion United States dollars, making him the seventh richest man in the world. Most people wonder how did Elon Musk get rich. Well, he became a multimillionaire after striking that deal where he sold Zip2 for $22 million. Other than that, his companies, Tesla and SpaceX, along with his other ventures like The Boring Company, SolarCity, OpenAl and Neuralink have also reached exceptional heights, making him one of the richest men on the planet.

How Does Elon Musk Get Paid?

A May 2019 report from The New York Times showed that in 2018, the Tesla CEO got investment opportunities worth almost $2.3 billion. However, the electric-car company questioned that claim, saying Musk “actually earned $0 in total compensation from Tesla in 2018.” The error originates from the compensation being determined as per Securities and Exchange Commission rules on CEO pay announcing, instead of the real worth acknowledged by executives in any year.

According to Tesla, in contrast to other different CEOs, Elon gets no pay, no money related bonuses, and no value that essentially vests by the progression of time. His lone remuneration is a totally at-risk performance award that was explicitly planned with aspiring achievements, for example, multiplying Tesla’s present market capitalization from roughly $40 billion to $100 billion. Subsequently, Elon’s whole pay is directly attached to the drawn out achievement of Tesla and its investors, and none of the value from his 2018 presentation bundle has vested.

Conclusion

Now that you have read this article, you know that Elon Musk had to work hard in his life despite having a rich father and a well known mother. He still saw defeat and downfall, at school and also when he entered his professional life. However, his determination and persistence got him to where he is today. As far as the question of how did Elon Musk get rich is concerned, it is because of his multimillion dollar corporations, Tesla and SpaceX, along with his other ventures.