Tesla, SpaceX, and the Quest for a Fantastic Future
Musk was broad shouldered and looked fit. We met for dinner. At first, he didn’t want to let me write about him. However, I interviewed many of his friends whom I already knew. He wanted to have a say in the editing. He could not stand factual errors. Musk was worried about Google building AI robots to destroy mankind. Finally, he relented and allowed me to write about him. Deep down, he respects resolute people who don’t give up despite facing rejection. We would meet once a month to have dinner and work on the book. He asked me whether I thought he was insane. I visited his headquarters of SpaceX. To Musk, he wanted to enable humans to live on Mars. He does say ridiculous things sometimes. He is like a deity in Silicon Valley for doing the impossible. He was in a techno-utopian club and is a well-intentioned dreamer. To an outsider, he is simply dreaming of utopia. SpaceX flew a supply capsule to the ISS; Tesla Motors delivered Model S and he was the biggest shareholder of SolarCity. These were some of his achievements. There is a rectangle printed outside SpaceX HQ and it says ‘Unity of Body, Soul and Mind’. There were hundreds of people in the factory helping to assemble rockets in Musk Land. There is the R&D for Tesla. Sometimes, he comes around as being shy and awkward. He often pauses when he speaks. He doesn’t talk nonsense and is usually very serious. Musk walks around and talks to employees. Silicon Valley had crazy ideas where people tried to make as much money as possible. However, nowadays, people just want to play it safe and avoid taking excessive risk. The dotcom boom showed that many companies just wanted an easy buck without creating physical products that added value. There was a decline in innovation in the year 2000s. Nowadays, people were just refining innovations without creating anything revolutionary. Peter Thiel had a similar view too. Was technology changing the world? Musk was different and he was wildly ambitious. EBay acquired PayPal for $1.5 billion in 2002. Musk was daring and tried to reinvent the aerospace and automotive and solar industries. There was a high chance that he would fail. The Space industry was dominated by Lockheed Martin and Boeing. Musk fears that the Russians will assassinate him if his space programme is better than theirs. Tesla makes fully electric cars and sells them on the Web. Electric cars do not require much servicing. There are many recharging stations around. Musk is also thinking of building end-to-end transportation system. He has a net worth of $10 billion and SolarCity is working well. Many people respect his drive and mission. Musk has one of the grandest tasks ever imagined. Musk credited his tough childhood for his success. He has a crazy schedule and gets little sleep. Musk has twice divorced (Justine and Talulah Riley). Musk organizes crazy parties on his birthdays. Riley tries to entertain him and let him take breaks from work. Musk was complaining that not many people were working on weekends at Tesla. There was a love-hate relationship with him. Musk is different from others at the Valley and wants to integrate technology for the long-term. You have to live in Elon’s world if you want to survive.
I would like to die thinking that humanity has a bright future. If we can solve sustainable energy and be well on our way to becoming a multiplanetary species with a self-sustaining civilization on another planet – to cope with a worst-case scenario happening and extinguishing human consciousness – I think that would be really good. – Elon Musk
I think there are probably too many smart people pursuing Internet stuff, finance and law. That is part of the reason why we haven’t seen as much innovation. – Elon Musk
It’s the sweeping goal that forms a unifying principle over everything he does. Employees at all three companies are well aware of this and well aware that they’re trying to achieve the impossible day in and day out. – Ashlee Vance
I would like to allocate more time to dating, though. I need to find a girlfriend. That’s why I need to carve out just a little more time. I think maybe even another five to ten – how much time does a woman want a week? Maybe ten hours? That’s kind of the minimum? I don’t know. – Elon Musk
We’ve grown fucking soft. I was just going to send out an email to Tesla employees: “We’re fucking soft.” – Elon Musk, after learning that less employees at Tesla were working on weekends
Africa. The public first met him in 1984. He was a software programme back then. Back then, he had big dreams. He fantasized about space and battles. When he was young, he liked the Hitchhiker’s Guide to the Galaxy. He wanted to strive for greater collective enlightenment. He also relied on philosophy texts. Musk was born in SA in 1971. He wanted to leave Africa because of the apartheid violence that ensued in the 1970s. He plotted an escape from SA. America was the land of dreams at that time. Musk’s grandfather was a great inspiration to him. His name was Joshua Norman Haldeman. Initially, his grandpa worked on a farm and later moved to doing odd jobs before finally becoming a chiropractor. Later, he bought a plane and also wrote a book on planes. However, in his later years, Haldeman sold everything and then moved to SA and opened a chiropractice business. Haldeman never believed in punishing kids. He was an adventurous man as a pilot. Musk admits that he might have adopted the risk tolerance level of his grandpa. Maye was Elon’s mother. Elon’s father was Errol. Errol worked as an electrical engineer while Maye was a dietician. Elon has a brother named Kimbal and a sister named Tosca. Elon tended to space out sometimes. He was really obsessed about thinking and would be oblivious to those around him. Elon was gifted at maths and science. Since young, he had an obsession with reading. He plowed through books like ‘The Lord of the Rings’. His knowledge was also impressive because he memorized facts from the encyclopaedia. Only when he grew older that he developed strong relationships with his family. Later, his parents underwent a divorce and Elon decided to live with his dad. Elon loved learning engineering stuff from his dad. Errol was proud of Elon’s achievements. Elon had a bad childhood and had some bad memories of Errol. When he was young, Elon experimented with gunpowder and was lucky not to have hurt himself. Back in the day, he and his brother would go for adventures in South Africa. Musk was often hounded by bullies when he was in school. Elon was not the brightest kid in school. The only subjects he was interested in was computing, maths and science. South Africa was like a prison for Musk.
Maybe I read too many comics a kid. In the comics, it always seems like they are trying to save the world. It seems like one should try to make the world a better place because the inverse makes no sense. – Elon Musk
Canada. Musk’s uncle wasn’t in Canada. He tried to contact his cousins which he knew. Musk did odd jobs for a living. Finally, Musk enrolled in Queen’s University. His brother and him cold-called people and wanted to ask them out for lunch. They got to meet Peter Nicholson, a top executive at Bank of Nova Scotia. Christie was Peter’s daughter and Musk liked her. Musk knew Justine Wilson from Queen’s. They both were top students in the school and very academically driven. Although Justine dated other people, Elon was persistent. Elon simply did not give up. Elon liked board games and could play it for hours on end. When he is interested in something, he develops such a deep interest into it that not many people can match. Musk enjoyed his time at Penn. He made a good friend in school. He was Adeo Rossi. Elon hated the taste of alcohol. Back then, he had great ideas on how to harness solar energy. He could link scientific research into how to profit via setting up a business. He was not chasing fads and the ideas for his businesses had already sprung up in college.
If there was a way that I could not eat, so I could work more, I would not eat. I wish there was a way to get nutrients without sitting down for a meal. – Elon Musk
Elon’s First Start-up. Kimbal and Musk took road trips. The Web was up and coming at that time. Kimbal thought of a business of creating an online network for doctors. Musk was keen on his ultra-capacitors. In the day, Elon worked at Pinnacle. In the evening, he worked on Rocket Science Games. He dropped out of his PhD programme and went for the Internet’s craze. Elon was a self-learner and liked to find out stuff on his own. Their first start-up would be Zip2. It was like a ‘yellow’ pages of the web. Errol, his dad, gave him money to aid at the initial stage of the business. Musk and Kimbal lived in the office. They did door to door sales and were very poor indeed. Musk didn’t seem to go home during the weekends. Kimbal was the optimist. The business didn’t take off and many customers rejected him. The sales report was depressing indeed. Musk kept making improvements to the Zip2 software. Investors were bought into Musk’s passion for the company. He was willing to risk a large chunk of his time. Greg Kouri was his business mentor. Mohr Davidow, a VC, invested $3m in the company. Zip2 wanted to sell to newspapers, who would then sell to others. They wanted to do away with the door-to-door model. Musk was a CTO now. However, the VC hired a CEO and Musk had to lose control of the company. Elon wanted to be CEO. Elon was not as skilled as the best coders in town. Musk was in control now, he wasn’t soft when he was back in school. Elon tended to criticize senior people upfront but soon mellowed with age. To him, the word ‘no’ doesn’t exist. Elon’s mentality was ‘do or die but don’t give up’. Zip2 had great success courting newspapers. Musk brought the matter that he wanted to be CEO again and to sack the existing guy. The board were not pleased by his defiance. Microsoft was competing with Zip2 and was doing better. Compaq computer bought Zip2 for $307 million and the owners were delighted. This lesson was important and taught Elon of the importance to have control and that investors might change your business model of your company sometimes. Elon sometimes fixed people’s problems for them without telling them. People didn’t like that. He made a good profit from his first business.
If you asked Elon how long it would take to do something, there was never anything in his mind that would take more than an hour. We came to interpret an hour as really taking a day or two and if Elon ever did say something would take a day, we allowed for a week or two weeks. – Jim Ambras
PayPal Mafia Boss. Elon was confident after the sale of Zip2. The bank of Nova Scotia passed up the opportunity for a trade worth a lot of money as they didn’t want to invest in debt of developing countries. Elon realised that bankers were stupid and they didn’t take their opportunities. They simply followed other people blindly. Then, he wanted to create an Internet bank. By then, security was not good and that might pose a threat to banking transactions online. He wanted to create a bank to process online transactions and navigate all the regulatory loops. The starting name for the company was X.com. He bought an apartment and a sports car with his new found wealth. He thought X.com would be the next big thing. Musk joined the big boys club in racing. Then, he got into a minor accident, which damaged the car. Musk invested $12m into X.com. X.com had the potential to be a revolution. It was an industry which he wasn’t familiar with. Musk started the company with Ho, Fricker and Payne. Elon had to read up on banking to understand how it worked. Regulatory problems were horrible. Fricker was displeased as Musk was making visionary statements which did not promise anything. Fricker ordered a coup and took everyone with him. Elon was upset but wanted to continue. Elon tried to seek venture capital. X.com tried out radical banking ideas and a P2P money transfer system. Many people were hooked on this service. Peter Thiel and Max Levchin were working on Confinity. They were in direct competition with one another. It was like head-on competition. Musk worked crazy hard. Finally, X.com and Confinity decided to merge and join forces. There was a tech rift and Thiel resigned. Levchin threatened to walk out of the business. Fraud was present as X.com couldn’t cope with the number of transactions. A group of employees wanted Thiel back as CEO and to kick Musk out without letting him know. The board voted and Thiel replaced Musk. It was split and some employees were not happy that Musk was removed. Thiel renamed X.com as PayPal. Elon, instead of being bitter, supported Peter and continued investing in PayPal. Finally, eBay bought PayPal for $1.5 billion and Elon netted $180m after taxes. Musk had a bad reputation as the media saw him as being ego-centric. Some investors didn’t like the ‘I-know-it-all’ attitude. The PayPal mafia were known to be the brightest people around. Given even time, Musk tends to achieve his ambitious goals. Justine and Elon had a good relationship at that time. Finally, Elon proposed to Justine. Elon was never afraid of responsibility. Later on during the marriage, Elon mentioned how he didn’t like her shortcomings. The marriage didn’t last. Then, Elon fell terribly sick after contracting Malaria from a trip to Africa. He nearly died. A vacation almost killed him.
He’s willing to take an insane amount of personal risk. When you do a deal like that, it either pays off or you end up in a bus shelter somewhere. – Ed Ho
Mice in Space. Elon was 30 in 2001. People often bragged about the long hours they worked. The couple decided to move to LA. The call of space attracted him. Now, Elon was crazy about space. LA would be the HQ. Most of the aeronautics work was held there. Zubrin invited Musk for coffee. He educated Elon on some experiments. It was possible for mice to reproduce in space. Although Elon didn’t know a lot about space, he was willing to find out. Elon started donating money to the Mars Society. Elon wanted to send mice to Mars, and not just into orbit. The intent was for the mice to procreate along the way. Elon felt that the public should focus more on space. He was alarmed as NASA wasn’t planning anything too. Elon wanted people to consider the potential of Mars. There were many people who were interested in his project. The plan was to build a greenhouse on Mars. Elon has the belief that he will be the guy who will change the world. The problem was funding and Elon had to have at least 200 million to spare. Elon started to explore how much a launch to Mars would cost. Elon and his friends headed to Russia and planned to buy a rocket. The Russians didn’t think Elon was a genuine buyer and insulted him. He was pissed and stormed out of the meeting. Russia were the only ones who had cheap rockets. Then, on the plane back to LA, Elon thought that we could build the rocket ourselves. Space exploration was risky and you could blow your fortune. Elon built a spreadsheet and calculated the cost of building a rocket and read astronomy books. Some of his colleagues thought that he would fail. It was then that Tom Mueller met Elon. Mueller was a geek in astronomy. He managed to build liquid-fuel rocket engines. Mueller met Musk and they started chatting. Soon, he was in the team. The plan was to reduce the cost of sending things up to space. Space Exploration Technologies was founded in June 2002. The engineers and machinists would be working close to one another. They wanted to revolutionise the space industry.
Being a private company, Elon could avoid the waste and cost overruns of government contractors. It might soon be possible to send satellites to space in a cheaper fashion. Their first launch would be called Falcon 1. Many people wrote Elon and his team off. Justine’s son, Nevada Alexander Musk, passed away when he was 10 weeks old. Justine had other kids later on. Elon didn’t want to talk about the baby’s death. Elon had an A-star team at SpaceX. Brown was his assistant and she helped a lot as well. Boeing had large and cumbersome projects. Hollman soon joined Elon’s team. SpaceX was working on a crazy timeline and wanted to launch their rocket only 15 months after the company started. Many of the engineers worked all nights. Empowerment also kept the team going and motivated them. Many of the tests were failures. Elon hated excuses or the lack of clear plan. Elon was not afraid to get his hands dirty. The SpaceX family was tight and united. The first prototype was unveiled to the public in Dec 2003. Hollman was stressed and was at a breaking point after he broke his glasses. Elon heard him whining at work and offered to pay for his Lasik surgery. SpaceX revealed plans to build Falcon 5, where the rocket would have enough power to reach the ISS. Musk looked out for graduates who did well in school but also had done exceptional things with their talents. Many suppliers could not keep up with SpaceX’s schedule. Elon hated the standard relationship-building exercise with salespeople. Sometimes, Musk tried to claim credit for the work and this infuriated the engineers. Things didn’t work well and Falcon 1 launch was delayed. SpaceX had to find a launch pad. There was also always something to do at SpaceX and there were plenty of engineering problems to solve. The problems kept coming. It was a bonding experience. In Nov 2005, the rocket was ready for launch. It failed and the next launch was slated for Dec instead. The project delayed again till Mar 2006. The rocket launched but disintegrated midway. Hollman and Musk had a shouting match as Musk thought that it was Hollman’s fault for the crash. The engineers vowed to take a more disciplined approach in future. On Mar 2007, Falcon 1 launched and flew for 5 minutes before crashing again. Elon was a very optimistic guy. This was a guy who thought big.
I had friends who complained that their husbands came home at seven or eight. Elon would come home at eleven and work some more. People didn’t always get the sacrifice he made in order to be where he was. – Justine Musk
The longer you wait to fire someone, the longer it has been since you should have fired him. – Elon Musk
SpaceX is in this for long haul and, come hell or high water, we are going to make this work. – Elon Musk
All Electric. Straubel liked to play with chemicals in his younger days. He wanted to develop his own software and control energy. The clean-tech movement was still new. He built an electric car. However, electric cars had limitations like battery life. He formed friendships with those in Stanford. Lithium ion batteries were getting better at that time. Straubel wanted to build an electric car made up of lithium ion batteries. In 2003, he met Elon Musk. Elon wasn’t keen on the plane project but was keen on the electric car project. Elon initially wanted ultracapacitors as batteries. Elon gave him some money. AC Propulsion had a tzero car and Elon was deeply impressed by it. Elon was determined to build a high performance base car and electric powertrain. Eberhard was a great engineer. He was also interested in the AC Propulsion cars. Eberhard later started a company on electric cars manufacturing. They were targeting the rich people in the US. Eberhard and Tarpenning incorporated their company in July 1, 2003. It was called Tesla Motors. The last successful car start-up was Chrysler. There were plenty of hurdles they needed to cross. They decided to sell their cars direct and to license technology from AC Propulsion. The founders wanted Elon Musk on board to provide funding for a prototype. Finally, Elon agreed and wanted to end US’s addiction to oil. Later on, Musk and Eberhard would experience a power struggle. Straubel joined their team too. They were planning to build a car from scratch. They found a make-shift office and started work. The body would be the Lotus Elise body. Dave Lyons was a brilliant engineer who was on their team. Elon invested $9million more into the company. Suddenly, one of their batteries caught fire. It was a setback as there were safety issues. Tesla was on a verge of a breakthrough. The Roadster body still was a work of progress. By May 2006, there were a hundred employees. Google’s founders also invested in the car. The cars were well designed and could go from zero to 60 in about 4 seconds. The car costs more than $90,000 and could drive 250 miles on a single charge. Many rich people wanted in. When tests were run, engineers would solve the problems on the spot. Detroit was not a very friendly place for business. It was a big turn off. Eberhard didn’t like Elon as he kept wanting to make the car more comfortable but this delayed the shipping. Later on, the company would have big problems trying to mass produce cars. The transmitted and gear change was a big problem and was difficult to solve. They set up a factory in Thailand but managing the Thai workers was difficult and frustrating. Watkins was hired to diagnose the manufacturing problems. There was excessive expenditure in equipment and materials. The actual costs turned out to be $170,000 per car and they were only selling it for $85,000. The company continued to miss deliveries while Eberhard was CEO. The cost figures made people think that Eberhard was mismanaging the company and not bothering about cost. Eberhard was demoted by the board and Michael Marks would be CEO. In Dec, Eberhard left the company. The car still had problems. Marks and Elon had disagreements. Marks had the intention to sell the company away. However, Elon disagreed and wanted to control it. Ze’ev Drori replaced Marks in 2007. Musk was hands-on and would work on pressing problems personally. Musk ran the place like a military camp. Elon was sharp in spotting details. Elon could be very imposing. You must be as crazy as him to survive. Straubel admired Elon’s work ethic. The company was almost made bankrupt as they were bleeding funds. Elon tried to persuade investors to pump in more money.
I would tell those employees that they will get to see their families a lot when we go bankrupt. – Elon Musk, after Tesla employees complained that they couldn’t see their families as they made to work on weekends due to car production problems
I never want to hear that “it was the standard way things had always been done” phrase again. What we have to do is fucking hard and half-assing things won’t be tolerated. – Elon Musk
For Part 2, click here.