Tesla, SpaceX and the quest for a fantastic future, by Ashlee Vance (a summary by Pat Evert)
• Elon’s world
Musk asked me, “Do you think I’m insane?” The poster on the right showed a Mars with a humongous green landmass surrounded by oceans. The planet had been heated up and transformed to suit humans. Musk fully intends to try and make this happen. Turning humans into space colonizers is his stated life’s purpose. “I would like to die thinking that humanity has a bright future,” he said. “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.” Yet, in the early part of 2012, the cynics like me had to take notice of what Musk was actually accomplishing. His once-beleaguered companies were succeeding at unprecedented things. SpaceX flew a supply capsule to the International Space Station and brought it safely back to Earth. Tesla Motors delivered the Model S, a beautiful, all-electric sedan that took the automotive industry’s breath away and slapped Detroit sober.
Instead of hanging around Silicon Valley and falling into the same funk as his peers, Musk decamped to Los Angeles. The conventional wisdom of the time said to take a deep breath and wait for the next big thing to arrive in due course. Musk rejected that logic by throwing $ 100 million into SpaceX, $ 70 million into Tesla, and $ 10 million into SolarCity. Short of building an actual money-crushing machine, Musk could not have picked a faster way to destroy his fortune. He became a one-man, ultra-risk-taking venture capital shop and doubled down on making super-complex physical goods in two of the most expensive places in the world, Los Angeles and Silicon Valley. Whenever possible, Musk’s companies would make things from scratch and try to rethink much that the aerospace, automotive, and solar industries had accepted as convention. SpaceX has been testing reusable rockets that can carry payloads to space and land back on Earth, on their launchpads, with precision. If the company can perfect this technology, it will deal a devastating blow to all of its competitors and almost assuredly push some mainstays of the rocket industry out of business while establishing the United States as the world leader for taking cargo and humans to space. It’s a threat that Musk figures has earned him plenty of fierce enemies. With Tesla Motors, Musk has tried to revamp the way cars are manufactured and sold, while building out a worldwide fuel distribution network at the same time. Tesla does not sell these cars through dealers; it sells them on the Web and in Apple-like galleries located in high-end shopping centers. Tesla also does not anticipate making lots of money from servicing its vehicles, since electric cars do not require the oil changes and other maintenance procedures of traditional cars. The direct sales model embraced by Tesla stands as a major affront to car dealers used to haggling with their customers and making their profits from exorbitant maintenance fees. During a time in which clean-tech businesses have gone bankrupt with alarming regularity, Musk has built two of the most successful clean-tech companies in the world. The Musk Co. empire of factories, tens of thousands of workers, and industrial might has incumbents on the run and has turned Musk into one of the richest men in the world, with a net worth around $ 19 billion. 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. When Musk sets unrealistic goals, verbally abuses employees, and works them to the bone, it’s understood to be—on some level—part of the Mars agenda. Some employees love him for this. Others loathe him but remain oddly loyal out of respect for his drive and mission. What Musk has developed that so many of the entrepreneurs in Silicon Valley lack is a meaningful worldview. He’s the possessed genius on the grandest quest anyone has ever concocted. He’s less a CEO chasing riches than a general marshaling troops to secure victory. Where Mark Zuckerberg wants to help you share baby photos, Musk wants to . . . well . . . save the human race from self-imposed or accidental annihilation. Riley met Musk back in 2008, when his companies were collapsing. She watched him lose his entire fortune and get ridiculed by the press. She knows that the sting of these years remains and has combined with the other traumas in Musk’s life—the tragic loss of an infant son and a brutal upbringing in South Africa—to create a tortured soul. He’s set about building something that has the potential to be much grander than anything Hughes or Jobs produced. Musk has taken industries like aerospace and automotive that America seemed to have given up on and recast them as something new and fantastic. Squint ever so slightly, and it looks like Musk could be using his skills to pave the way toward an age of astonishing machines and science fiction dreams made manifest. He’s an inventor, celebrity businessman, and industrialist able to take big ideas and turn them into big products. He’s employing thousands of people to forge metal in American factories at a time when this was thought to be impossible.
At around age fourteen, embracing the sci-fi lessons found in one of the most influential books in his life: The Hitchhiker’s Guide to the Galaxy, by Douglas Adams. “He points out that one of the really tough things is figuring out what questions to ask,” Musk said. “Once you figure out the question, then the answer is relatively easy. I came to the conclusion that really we should aspire to increase the scope and scale of human consciousness in order to better understand what questions to ask.” The teenage Musk then arrived at his ultralogical mission statement. “The only thing that makes sense to do is strive for greater collective enlightenment,” he said. This is how it came to pass that a lonesome, gawky South African boy who talked with the utmost sincerity about pursuing “collective enlightenment” ended up as America’s most adventurous industrialist.
Maye Musk, Elon’s mother, was gorgeous. On the weekends, she did runway shows, magazine shoots, occasionally showed up at a senator’s or ambassador’s home for an event, and ended up as a finalist for Miss South Africa. (Maye has continued to model into her sixties, appearing on the covers of magazines like New York and Elle and in Beyoncé’s music videos.) His father, Errol, worked as a mechanical and electrical engineer and handled large projects such as office buildings, retail complexes, residential subdivisions, and an air force base, while Maye set up a practice as a dietician.
The perplexing thing was that Elon seemed to drift off into a trance at times. “He goes into his brain, and then you just see he is in another world,” Maye said. “He still does that. Now I just leave him be because I know he is designing a new rocket or something.” For Musk, these pensive moments were wonderful. At five and six, he had found a way to block out the world and dedicate all of his concentration to a single task. Part of this ability stemmed from the very visual way in which Musk’s mind worked. He could see images in his mind’s eye with a clarity and detail that we might associate today with an engineering drawing produced by computer software. “For some reason, a gang of bullies had made growing up difficult. For a number of years, there was no respite. You get chased around by gangs at school who tried to beat the shit out of me, and then I’d come home, and it would just be awful there as well. It was just like nonstop horrible.” During a science-class debate, Elon gained attention for railing against fossil fuels in favor of solar power—an almost sacrilegious stance in a country devoted to mining the earth’s natural resources. “He always had firm views on things,” said Wood. Terency Beney, a classmate who stayed in touch with Elon over the years, claimed that Musk had started fantasizing about colonizing other planets in high school as well. There’s no question, though, that Musk had been pining to get to the United States on a visceral level for a long time. Musk’s early inclination toward computers and technology had fostered an intense interest in Silicon Valley, and his trips overseas had reinforced the idea that America was the place to get things done.
Going through college Musk will have the occasional vodka and Diet Coke, but he’s not a big drinker and does not really care for the taste of alcohol. “Somebody had to stay sober during these parties,” Musk said. “I was paying my own way through college and could make an entire month’s rent in one night. Adeo was in charge of doing cool shit around the house, and I would run the party.” As Ressi put it, “Elon was the most straight-laced dude you have ever met. He never drank. He never did anything. Zero. Literally nothing.” The only time Ressi had to step in and moderate Musk’s behavior came during video game binges that could go on for days. He’d been obsessed with video games since his childhood and had held a gaming internship. But he came to see them as not quite grand enough a pursuit. “I really like computer games, but then if I made really great computer games, how much effect would that have on the world,” he said. “It wouldn’t have a big effect. Even though I have an intrinsic love of video games, I couldn’t bring myself to do that as a career.” As he tells it, he would daydream at Queen’s and Penn and usually end up with the same conclusion: he viewed the Internet, renewable energy, and space as the three areas that would undergo significant change in the years to come and as the markets where he could make a big impact.
• Elon’s first start-up
Musk found in Silicon Valley a wealth of the opportunity he’d been seeking and a place equal to his ambitions. He would return two summers in a row and then bolt west permanently after graduating with dual degrees from Penn State. He initially intended to pursue a doctorate in materials science and physics at Stanford and to advance the work he’d done at Pinnacle on ultracapacitors. As the story goes, Musk dropped out of Stanford after two days, finding the Internet’s call irresistible. The Zip2 idea was ingenious. Few small businesses in 1995 understood the ramifications of the Internet. They had little idea how to get on it and didn’t really see the value in creating a website for their business or even in having a Yellow Pages–like listing online. Musk and his brother hoped to convince restaurants, clothing shops, hairdressers, and the like that the time had come for them to make their presence known to the Web-surfing public. Starting Zip2 and watching it grow imbued Musk with self-confidence. You don’t get to where Elon is now by always being a nice guy, and he was just so driven and sure of himself. In February 1999, the PC maker Compaq Computer suddenly offered to pay $ 307 million in cash for Zip2. Musk and Kimbal had come away with $ 22 million and $ 15 million, respectively. Elon was on to his next project. From that point on, Musk would fight to maintain control of his companies and stay CEO. “We were overwhelmed and just thought these guys must know what they’re doing,” Kimbal said. “But they’ didn’t. There was no vision once they took over. They were investors, and we got on well with them, but the vision had just disappeared from the company.”
• PayPal mafia boss
It had taken Musk less than a decade to go from being a Canadian backpacker to becoming a multimillionaire at the age of twenty-seven. Musk invested about $ 12 million into X.com, leaving him, after taxes, with $ 4 million or so for personal use. He’s willing to take an insane amount of personal risk. Musk would certainly go on to rely on outside investors, but he put major skin in the game as well. The cofounders were aligned philosophically around the idea that the banking industry had fallen behind the times. Visiting a branch bank to speak with a teller seemed pretty archaic now that the Internet had arrived. There was a merger between X.com and PayPal. PayPal had the hottest product in PayPal and most customers, but X.com, by contrast, still had plenty of cash reserves and the more sophisticated banking products. Musk, after being ousted from his CEO position, embraced the role of being an advisor to the company and kept investing in it, increasing his stake as PayPal’s largest shareholder. “You would expect someone in Elon’s position to be bitter and vindictive, but he wasn’t,” said Botha. “He was a prince.” In July 2002, eBay offered $ 1.5 billion for PayPal, and Musk and the rest of the board accepted the deal. Musk netted about $ 250 million from the sale to eBay, or $ 180 million after taxes—enough to make what would turn out to be his very wild dreams possible. Musk’s traits as a confrontational know-it-all and his abundant ego created deep, lasting fractures within his companies. These criticisms must be weighed against Musk’s track record. He demonstrated an innate ability to read people and technology trends at the inception of the consumer Web. Just as people became comfortable with buying things from Amazon.com and eBay, Musk made the great leap forward to full-fledged Internet banking. He would bring standard financial instruments online and then modernize the industry with a host of new concepts. He exhibited a deep insight into human nature that helped his companies pull off exceptional marketing, technology, and financial feats. Musk was already playing the entrepreneur game at the highest level and working the press and investors like few others could. Did he hype things up and rub people the wrong way? Absolutely—and with spectacular results.
PayPal staff pioneered techniques in fighting online fraud that have formed the basis of software used by the CIA and FBI to track terrorists and of software used by the world’s largest banks to combat crime. This collection of super-bright employees has become known as the PayPal Mafia—more or less the current ruling class of Silicon Valley—and Musk is its most famous and successful member. His wife Justine knew all about Musk’s grim childhood and the intense range of emotions he could exhibit. Her romantic sensibilities overrode any trepidation she might have had about these parts of Musk’s history and character and centered instead on his strength. Musk often talked fondly about Alexander the Great, and Justine saw him as her own conquering hero. “He wasn’t afraid of responsibility,” she said. “He didn’t run from things. He wanted to get married and have kids early on.” Musk also exuded a confidence and passion that made Justine think life with him would always be okay. “Money is not his motivation, and, quite frankly, I think it just happens for him,” Justine said. “It’s just there. He knows he can generate it.” “He’s built like a tank,” she said. “He has a level of stamina and an ability to deal with levels of stress that I’ve never seen in anyone else.
• Mice in space
Musk had picked Los Angeles with intent. He realized that just by being in Los Angeles he would be surrounded by the world’s top aeronautics thinkers. They could help him refine any ideas, and there would be plenty of recruits to join his next venture. Musk’s first interactions with the aeronautics community were with an eclectic collection of space enthusiasts, members of a nonprofit group called the Mars Society. He seemed to know what he was doing, weeding out the naysayers meeting by meeting and forming a crew of bright, committed engineers. Founded in June 2002, Space Exploration Technologies came to life in humble settings. At a time when the cost of sending a 550-pound payload started at $ 30 million, he promised that the Falcon 1 would be able to carry a 1,400-pound payload for $ 6.9 million. According to Musk, its first rocket would launch in “early 2004” from Vandenberg Air Force Base, carrying a satellite called TacSat-1 for the Department of Defense. The pending launch ignited Musk’s salesman instincts. He wanted to show the public what his tireless workers had accomplished and drum up some excitement around SpaceX. An accompanying press conference would make it clear to Washington that a modern, smarter, cheaper rocket maker had arrived. Despite not having even flown a rocket yet, SpaceX revealed plans for a second rocket. Along with the Falcon 1, it would build the Falcon 5. Per the name, this rocket would have five engines and could carry more weight—9,200 pounds—to low orbit around Earth. Crucially, the Falcon 5 could also theoretically reach the International Space Station for resupply missions—a capability that would open up SpaceX for some large NASA contracts. And, in a nod to Musk’s obsession with safety, the rocket was said to be able to complete its missions even if three of the five engines failed. There was always this feeling that we were facing a sort of insurmountable challenge and that we had to band together to fight the good fight. Musk never relented in asking his employees to do more and be better. Musk earned a reputation as a fearsome negotiator who did indeed follow up on things personally. “If Elon was not happy, you knew it,” Schmitz said. “Things could get nasty.” Risks were high on previous rockets, only 5 of the first 9 Pegasus launches succeeded; 3 of 5 for Ariane; 9 of 20 for Atlas; 9 of 21 for Soyuz; and 9 of 18 for Proton. Having experienced firsthand how hard it is to reach orbit, I have a lot of respect for those that persevered to produce the vehicles that are mainstays of space launch today. Elon is a guy that thinks big.
• All electric
J.B. Straubel was stalking the solar car crew, trying to talk them into building an electric car based on the lithium ion batteries. He would fly up to Palo Alto, spend the night sleeping in his plane, and then ride a bicycle to the Stanford campus to make his sales pitch while helping with their current projects. In the fall of 2003, Straubel met Elon Musk. “Everyone else had told me I was nuts about the lithium ion battery, but Elon loved the idea,” Straubel said. On July 1, 2003, Eberhard and Tarpenning incorporated their new company. Eberhard had come up with the name Tesla Motors, both to pay homage to the inventor and electric motor pioneer Nikola Tesla and because it sounded cool. But the more the Tesla guys researched the industry, the more they realized that the big automakers don’t even really build their cars anymore. They far,Ed out most of the parts. After talking to a number of people in the car dealership business, the Tesla team decided to avoid selling their cars through partners and sell direct. The Tesla founders felt like they had lucked into the perfect investor. Musk had the engineering smarts to know what they were building. He also shared their larger goal of trying to end the United States’ addiction to oil. With an investment of $ 6.5 million, Musk had become the largest shareholder of Tesla and the chairman of the company. Straubel had been building the battery pack needed and agreed to join forces and form this ragtag group. What Tesla did have, ahead of anyone else, was the realization that 18650 lithium ion batteries had gotten really good and were going to keep getting better. Hopefully that coupled with some effort and smarts would be enough. An undergraduate, Berdichevsky volunteered to quit school, and get a job at Tesla. As employee No. 7, he spent part of the workday in the Menlo Park office and the rest in Straubel’s living room designing three-dimensional models of the car’s powertrain on a computer and building battery pack prototypes in the garage. The early success at building two prototype cars, coupled with Tesla’s engineering breakthroughs around the batteries and other technological pieces, boosted the company’s confidence. In July 2006, Tesla decided to tell the world what it had been up to. The Roadsters would cost about $ 90,000 and had a range of 250 miles per charge. Tesla’s strategy of starting with a high-priced, low-volume product and moving down to more affordable products over time, as underlying technology and manufacturing capabilities advanced. By the middle of 2007, Tesla had grown to 260 employees and seemed to be pulling off the impossible. It had produced the fastest, most beautiful electric car the world had ever seen almost from thin air. All it had to do next was build a lot of the cars—a process that would end up almost bankrupting the company. Eberhard received a call from Musk and in a brief, uncomfortable chat learned that he would be replaced as CEO. Musk started the company to put a dent in the automotive industry and force people to rethink electric cars. “Some people thought Elon was too tough or hot-tempered or tyrannical,” Popple said. “But these were hard times, and those of us close to the operational realities of the company knew it. I appreciated that he didn’t sugarcoat things.” All that mattered was getting the Roadster and the follow-on sedan to market to popularize electric cars, and Musk looked like the best person to make that happen. Heading into 2008, the company was running out of money. The Roadster had cost about $ 140 million to develop, way over the $ 25 million originally estimated in the 2004 business plan. “Try to imagine explaining that you’re investing in an electric car company, and everything you read about the car company sounds like it is shit and doomed and it’s a recession and no one is buying cars.” All Musk had to do to dig Tesla out of this conundrum was lose his entire fortune and verge on a nervous breakdown.
• Pain, suffering and survival
The press had picked up on the fact that Musk tended to talk a huge game and then struggle to deliver on his promises in time. Tesla became the darling of Silicon Valley’s bloggers, who tracked its every move and were breathless in their coverage. Similarly, reporters covering SpaceX were overjoyed that a young, feisty company had arrived to needle Boeing, Lockheed, and, to a large extent, NASA. All Musk had to do was eventually bring some of these wondrous things he’d been funding to market. While Musk put on a good show for the public and press, he’d started to get very worried about his businesses. SpaceX’s second launch attempt had failed, and the reports coming in from Tesla kept getting worse. Musk had started these two adventures with a fortune nearing $ 200 million and had chewed through the money with little to show for it. As his businesses and public persona suffered, Musk’s home life degraded as well. On June 16, 2008 Musk filed for divorce. On the heels of divorce from Justine, Talulah Riley agreed to marry a man fourteen years her senior, who had five kids and two companies. I remember him saying, ‘Being with me was choosing the hard path.’ I didn’t quite understand at the time, but I do now. It’s quite hard, quite the crazy ride.
Both SpaceX and Tesla would need cash infusions at some point just to pay the employees, and it was unclear where that money would come from with the world’s financial markets in disarray and investments being put on hold. On July 30, 2008, the Falcon 9 had a successful test fire in Texas with all nine of its engines lighting up and producing 850,000 pounds of thrust. But after the third launch failure of Falcon 1, everyone was tired and broken emotionally. Musk addressed the workers right away and encouraged them to get back to work. He said, ‘Look. We are going to do this. It’s going to be okay. Don’t freak out,’ Singh recalled. “It was like magic. Everyone chilled out immediately and started to focus on figuring out what just happened and how to fix it. It went from despair to hope and focus.” SpaceX simply did not have enough money to try a fifth flight. He’d put $ 100 million into the company and had nothing to spare because of the issues at Tesla. “Flight four was it,” Musk said. If, however, SpaceX could nail the fourth flight, it would instill confidence on the part of the U.S. government and possible commercial customers, paving the way for the Falcon 9 and even more ambitious projects. So Falcon 1 on its fourth attempt, shut down just as planned and reached orbit, making it the first privately built machine to accomplish such a feat. It took six years—about four and half more than Musk had once planned—and five hundred people to make this miracle of modern science and business happen. SpaceX had the Falcon 9 efforts to support and had also immediately green-lighted the construction of another machine—the Dragon capsule—that would be used to take supplies, and one day humans, to the International Space Station. Historically, either project would cost more than $ 1 billion to complete, but SpaceX would have to find a way to build both machines simultaneously for a fraction of the cost.
“People joke about the Tesla Death Watch and all that, but it was harsh,” said Kimbal Musk. “One day there were fifty articles about how Tesla will die.” As 2008 came to an end, Musk had run out of money. “He looked like death itself,” Riley said. “I remember thinking this guy would have a heart attack and die. He seemed like a man on the brink.” Musk had to lean on friends just to try to make payroll from week to week, as he negotiated with investors. People inside NASA had backed SpaceX to become a supplier for the ISS. The company received a contract of $ 1.6 billion as payment for twelve flights to the space station. For Antonio Gracias, the Tesla and SpaceX investor and Musk’s friend, the 2008 period told him everything he would ever need to know about Musk’s character. He saw a man who arrived in the United States with nothing, who had lost a child, who was being pilloried in the press by reporters and his ex-wife and who verged on having his life’s work destroyed. “He has the ability to work harder and endure more stress than anyone I’ve ever met,” Gracias said. “What he went through in 2008 would have broken anyone else. He didn’t just survive. He kept working and stayed focused. Most people who are under that sort of pressure fray,” Gracias said. “Their decisions go bad. Elon gets hyperrational. He’s still able to make very clear, long-term decisions. The harder it gets, the better he gets.
SpaceX has metamorphosed from the joke of the aeronautics industry into one of its most consistent operators. SpaceX sends a rocket up about once a month, carrying satellites for companies and nations and supplies to the International Space Station. SpaceX can undercut its U.S. competitors—Boeing, Lockheed Martin, Orbital Sciences—on price by a ridiculous margin. It also offers U.S. customers a peace of mind that its rivals can’t. Where these competitors rely on Russian and other foreign suppliers, SpaceX makes all of its machines from scratch in the United States. Because of its low costs, SpaceX has once again made the United States a player in the worldwide commercial launch market. Its $ 60 million per launch cost is much less than what Europe and Japan charge. The total market for satellites, related services, and the rocket launches needed to carry them to space has exploded over the past decade from about $ 60 billion per year to more than $ 200 billion. A number of countries pay to send up their own spy, communication, and weather satellites. Companies then turn to space for television, Internet, radio, weather, navigation, and imaging services. Russia gets to charge $ 70 million per person for the trip and to cut the United States off as it sees fit during political rifts. At present, SpaceX looks like the best hope of breaking this cycle and giving back to America its ability to take people into space. Most significant, he’s been testing rockets that can push their payload to space and then return to Earth and land with supreme accuracy on a pad floating at sea or even their original launchpad.
Zip2, PayPal, Tesla, SolarCity—they are all expressions of Musk. SpaceX is Musk. Its foibles emanate directly from him, as do its successes. Employees fear Musk. They adore Musk. They give up their lives for Musk, and they usually do all of this simultaneously. SpaceX’s constantly pushes to advance its technology and change the economics of the industry. Musk does not simply want to lower the cost of deploying satellites and resupplying the space station. He wants to lower the cost of launches to the point that it becomes economical and practical to fly thousands upon thousands of supply trips to Mars and start a colony. The factory is a temple devoted to what SpaceX sees as its major weapon in the rocket-building game, in-house manufacturing. SpaceX manufactures between 80 percent and 90 percent of its rockets, engines, electronics, and other parts. It’s a strategy that flat-out dumbfounds SpaceX’s competitors. For SpaceX, the strategy works. In addition to building its own engines, rocket bodies, and capsules, SpaceX designs its own motherboards and circuits, sensors to detect vibrations, flight computers, and solar panels.
Musk’s growth as a CEO and rocket expert occurred alongside SpaceX’s maturation as a company. At the start of the Falcon 1 journey, Musk was a forceful software executive trying to learn some basic things about a very different world. After a couple of years running SpaceX, Musk had turned into an aerospace expert on a level that few technology CEOs ever approach in their respective fields. One of my favorite things about Elon is his ability to make enormous decisions very quickly. That is still how it works today. They avoid wasteful spending and bureaucracy. Musk had to sign off on every expenditure over $ 10,000. He made sure nothing stupid was happening. Decisions were made quickly during weekly meetings, and the entire company bought into them. “It was amazing how fast people would adapt to what came out of those meetings,” Watson said. “The entire ship could turn ninety degrees instantly. Lockheed Martin could never do anything like that.” The company has never sought to make a fortune off each flight. It would rather make a little on each launch and keep the flights flowing. A Falcon 9 flight costs $ 60 million, and the company would like to see that figure drop to about $ 20 million through economies of scale and improvements in launch technology. SpaceX spent $ 2.5 billion to get four Dragon capsules to the ISS, nine flights with the Falcon 9, and five flights with the Falcon 1. It’s a price-per-launch total that the rest of the players in the industry cannot comprehend let alone aspire to. SpaceX has already started testing a giant rocket, called the Falcon Heavy, that will take it much farther into space than the Falcon 9, and it has another, even larger spaceship on the way. Neither Boeing nor Lockheed, both of which can offer commercial services on their own, come close to competing on price against SpaceX, the Russians, or the Chinese. As for getting humans to space, SpaceX and Boeing were the victors in a four-year NASA competition to fly astronauts to the ISS. SpaceX will get $ 2.6 billion, and Boeing will get $ 4.2 billion to develop their capsules and ferry people to the ISS by 2017.
SpaceX has since expanded its launch capabilities at a remarkable pace and looks like it might be on the verge of getting that $ 12 million per flight option back. In June 2010, the Falcon 9 flew for the first time and orbited Earth successfully. In December 2010, SpaceX proved that the Falcon 9 could carry the Dragon capsule into space and that the capsule could be recovered safely after an ocean landing. In May 2012 SpaceX had set another first, as the only private company to dock with the ISS. A couple of months later SpaceX received $ 440 million from NASA to keep developing Dragon so that it could transport people. “Elon is changing the way aerospace business is done,” said NASA’s Stoker. “He’s managed to keep the safety factor up while cutting costs.” Musk revealed that the Dragon 2 will be able to land anywhere on Earth that SpaceX wants by using the SuperDraco engines and thrusters to come to a gentle stop on the ground. No more landings at sea. No more throwing spaceships away. One of the company’s next milestones will be the first flight of the Falcon Heavy, which is designed to be the world’s most powerful rocket. SpaceX has found a way to combine three Falcon 9s into a single craft with 27 of the Merlin engines and the ability to carry more than 53 metric tons of stuff into orbit. SpaceX boasts that the Falcon Heavy can take up twice the payload of the nearest competitor—the Delta IV Heavy from Boeing/ ULA—at one-third the cost. There’s a degree to which it’s just never enough for Musk, no matter what it is. But Musk is increasingly concerned about SpaceX going public before the Mars transport system is in place. Creating the technology needed to establish life on Mars is and always has been the fundamental goal of SpaceX. If being a public company diminishes that likelihood, then we should not do so until Mars is secure.
• The revenge of the electric car
The Model S outclassed most other luxury sedans in terms of raw speed, mileage, handling, and storage space. The car achieved the highest safety rating in history. And it could be recharged for free at Tesla’s stations lining highways across the United States and later around the world. Most cars end up being about 10–20 percent efficient at turning the input of gasoline into the output of propulsion. The Model S ends up being about 60 percent efficient, and there are no oil changes or tune-ups to be dealt with. From 2008 to 2012, Tesla sold about 2,500 Roadsters. The car had accomplished what Musk had intended from the outset. It proved that electric cars could be fun to drive and that they could be objects of desire. With the Roadster, Tesla kept electric cars in the public’s consciousness and did so under impossible circumstances, namely the collapse of the American automotive industry and the global financial markets. The body of the Model S was made out of lightweight aluminum instead of steel. In May 2009, things started to take off for Tesla. The Model S had been unveiled, and Daimler followed that by acquiring a 10 percent stake in Tesla for $ 50 million. The companies also formed a strategic partnership to have Tesla provide the battery packs for one thousand of Daimler’s Smart cars. Then the recession hit, and GM found itself trying to climb out of bankruptcy. It decided to abandon the plant in Fremont, California in 2009, and Toyota followed right after, saying it would close down the whole facility, leaving five thousand people without jobs. All of a sudden, Tesla had the chance to buy a 5.3-million-square-foot plant in its backyard. Just one month after the last Toyota Corolla went off the manufacturing line in April 2010, Tesla and Toyota announced a partnership and transfer of the factory. Tesla agreed to pay $ 42 million for a large portion of the factory (once worth $ 1 billion), while Toyota invested $ 50 million in Tesla for a 2.5 percent stake in the company. Tesla had basically secured a factory, including the massive metal-stamping machines and other equipment, for free. In the middle of 2012 Tesla Motors began shipping the model S sedan. Then, in September 2012, he unveiled something that shocked both Tesla critics and proponents alike. Tesla had secretly been building the first leg of a network of charging stations. By the middle of February 2013, Tesla had fallen into a crisis state. If it could not convert its reservations to purchases quickly, its factory would sit idle, costing the company vast amounts of money. Rival car companies would kill to receive such interest and had basically been left dumbfounded as Tesla snuck up on them and delivered more than they had ever imagined possible. Most car dealers make the majority of their profits from servicing cars. They treat vehicles like a subscription service, expecting people to visit their service centers multiple times a year for many years. With Tesla, “The ultimate goal is to never have to bring your car back in after you buy it,” said Javidan.
• The unified field theory of Elon Musk
The Rives decided to make buying into the solar proposition much simpler and formed a company called SolarCity in 2006. Musk had helped his cousins come up with this structure and become the company’s chairman and its largest shareholder, owning about a third of SolarCity. Six years later, SolarCity had become the largest installer of solar panels in the country. SolarCity is a key part of what can be thought of as the unified field theory of Musk. Each one of his businesses is interconnected in the short term and the long term. Tesla makes battery packs that SolarCity can then sell to end customers. SolarCity supplies Tesla’s charging stations with solar panels, helping Tesla to provide free recharging to its drivers. Newly minted Model S owners regularly opt to begin living the Musk Lifestyle and outfit their homes with solar panels. Tesla and SpaceX help each other as well.
All together, Musk Co. employed about fifteen thousand people at the end of 2014. Far from stopping there, the plan for Musk Co. calls for tens of thousands of more jobs to be created on the back of ever more ambitious products. Musk announced plans to build what he dubbed the Gigafactory, or the world’s largest lithium ion manufacturing facility. Each Gigafactory will employ about 6,500 people and help Tesla meet a variety of goals. Musk’s ultimate goal, though, remains turning humans into an interplanetary species. This may sound silly to some, but there can be no doubt that this is Musk’s raison d’être. If Musk wanted to get to Mars, he would have to earn it by building SpaceX into a real business. SpaceX has learned to make cheap and effective rockets and to push the limits of aerospace technology. In 2014, SpaceX also began construction on its own spaceport in South Texas. It has acquired dozens of acres where it plans to construct a modern rocket launch facility unlike anything the world has seen. Musk wants to automate a great deal of the launch process, so that the rockets can be refueled, stood up, and fired on their own with computers handling the safety procedures. SpaceX wants to fly rockets several times a month for its business, and having its own spaceport should help speed up such capabilities. At around $ 1 million or $ 500,000 per person to space travel, I think it’s highly likely that there will be a self-sustaining Martian colony. There will be enough people interested who will sell their stuff on Earth and move. It’s not about tourism. It’s like people coming to America back in the New World days. You move, get a job there, and make things work. “I try really hard to back away and put my ego aside,” Straubel said. “Elon is incredibly difficult to work for, but it’s mostly because he’s so passionate. He can be impatient and say, ‘God damn it! This is what we have to do!’ and some people will get shell-shocked and catatonic. Ultimately, Elon is the boss. He has driven this thing with his blood, sweat, and tears. He has risked more than anyone else. I respect the hell out of what he has done. “If you have all this money, which presumably you’re going to give away and couldn’t even spend it all if you wanted to, why then are you devoting your time to a company that’s not really doing anything good? That’s why I find Elon to be an inspiring example. He said, ‘Well, what should I really do in this world? Solve cars, global warming, and make humans multiplanetary.’ I mean those are pretty compelling goals, and now he has businesses to do that.” As Page puts it, “Good ideas are always crazy until they’re not.” It bothers Musk a bit that his kids won’t suffer like he did. He feels that the suffering helped to make him who he is and gave him extra reserves of strength and will.
The next decade of Musk Co. should be quite something. Musk has given himself a chance to become one of the greatest businessmen and innovators of all time. By 2025 Tesla could very well have a lineup of five or six cars and be the dominant force in a booming electric car market. Playing off its current growth rate, SolarCity will have had time to emerge as a massive utility company and the leader in a solar market that had finally lived up to its promise. SpaceX? Well, it’s perhaps the most intriguing. According to Musk’s calculations, SpaceX should be conducting weekly flights to space, carrying humans and cargo, and have put most of its competitors out of business. Its rockets should be capable of doing a couple of laps around the moon and then landing with pinpoint accuracy back at the spaceport in Texas. And the preparation for the first few dozen trips to Mars should be well under way. During a time in which countries and other businesses were paralyzed by indecision and inaction, Musk would have mounted the most viable charge against global warming, while also providing people with an escape plan—just in case. He would have brought a substantial amount of crucial manufacturing back to the United States while also providing an example for other entrepreneurs hoping to harness a new age of wonderful machines.
Note: the details of this book were published in May 2015. Much has transpired since then.