Editor’s note: This article was first published in January 2016; the situation of Tesla and SpaceX, Elon Musk’s wealth and SpaceX’s ease in raising money reflect that time, and his later marriages, companies and controversies are not covered.
When we talk about Elon Musk, we usually refer to him as the new Steve Jobs, although some say this young genius is already a Henry Ford, a Bill Gates and a Steve Jobs all in one. His list of successes speaks for itself, and many of the projects he has on the go will make the world a better place. Is there any better reward for an entrepreneur?
He is criticised by some of his employees, who say that working with him is far from easy because of his temperament, but well understood by others, who say that if you are mediocre you shouldn’t expect kind words from Musk. This businessman only hires the best, not the cheapest employees. That’s where his results come from.
But what do we really know about Elon Musk?
We often think that these millionaires come from well-off families or have had a very easy life. I always like to point out that, for the first time in history, the Forbes list of the world’s richest people is made up mostly of people who became rich on their own merits, not by inheriting companies or fortunes from their parents. Musk is no exception, and Time magazine has reminded us of a few things we probably didn’t know about the genius behind Tesla and SpaceX.
1. Elon Musk lived on 1 dollar a day for a while
After secondary school, Musk moved to Canada to attend Queen’s University in Ontario. He took several part-time jobs to cover his costs and, after paying his fixed expenses, had to survive on $1 a day for food, limiting his diet to hot dogs and oranges, which he bought in bulk. Now and then he alternated that diet with pasta and tomato sauce.
He always planned to move to the United States, and he figured that if he could live on a food budget of $30 a month, he could avoid going hungry and do almost anything he wanted in life.
2. He worked in a nightclub to pay the rent
Musk received a scholarship to study at the Wharton School of the University of Pennsylvania, but even so, he didn’t have enough money to pay the tuition. He rented a house with another person and had to work in a nightclub to cover that rent.
3. Musk was already a millionaire before the sale of PayPal
Most media outlets say that Elon Musk became rich after selling PayPal, but that would be incorrect: before selling PayPal, Musk had already made 300 million dollars from the sale of Zip2, a lesser-known software company he set up part-time, which provided maps and business directories.
4. Musk bets his own money on his companies
Many entrepreneurs complain about the lack of funding for their business ideas. Elon Musk doesn’t want investors’ money until an idea has matured, because he believes that if he takes investors’ money, they may push him to chase quick profits or steer him down paths other than the ones he had originally set.
Musk believes in himself, so he has never had a problem betting his own money on his business projects. In fact, Musk invested 10 million of his Zip2 earnings in his next venture, an online payments company called X.com, which we would later know as PayPal.
That 10 million investment turned into 1.5 billion when eBay bought PayPal, and Musk reinvested part of his earnings in Tesla. Later he would put more than 100 million of his own money into SpaceX.
5. Hard times: Elon Musk runs out of money
Tesla became a hungry company that brought in hardly any revenue and kept asking for more investment. According to Vogue, between 2008 and 2009 Musk had put all his money into Tesla and was borrowing money to pay his rent.
6. Tesla has been through some very difficult moments
Tesla may well have the car of the future on its hands, unless it loses its dominant position in the sector and other manufacturers overtake it with electric cars. But Tesla has found itself in desperate fights for survival.
In 2009, Tesla had barely any money and was close to bankruptcy, and it found itself in the same situation again in 2013, when, it is said, the company was so desperate that it came close to being sold to Google for 6 billion.
But a last-minute injection of money saved the company and, in an unexpected turn, Tesla reported its first profitable quarter.
7. SpaceX was also on the verge of bankruptcy
In 2008, SpaceX was almost bankrupt. It is said that a 1.6 billion NASA contract was what saved the company. Since then, SpaceX has had no trouble raising billions whenever it needs them.
See also: Elon Musk’s almost obsessive habits for being more productive than everyone else
As we can see, Elon Musk’s life has not been easy, and his business career has been full of ups and downs. At times his companies have been on the brink of bankruptcy, and so has his personal financial situation.
Success is not linear, but perseverance should rise in a steady, straight line.
See also: Which skills really matter for success in business
Featured image: SpaceX Photos, CC0 1.0, via Wikimedia Commons.
.jpg){kind=link}