Last week, I mentioned Elon Musk’s deep pessimism about the impact of artificial intelligence on the human race. I don’t share that pessimism, but it seems to be one of the key motivators of this driven, innovative and (so-far) very successful individual. Musk is one or a kind, combining analysis of problems from first principles (so deciding that space travel should be cheaper and easier than it seemed, for example) with creativity, showmanship plus the essential quality of being able to convince investors to take a chance.
He also mixes the ability to take a broad view of complex issues and products with a degree of micro-management (nano-management, in his own words) that keeps him aware of all the small details that need to be right. He seems something like a blend of Steve Jobs and Richard Branson, but his scope and ambition goes far beyond theirs.
Having co-founded a web software company (called Zip2, publishing online city guides) he made $22 million from its sale just four years later. $10 of this he used to co-found an online email payment company (X.com), which later merged with PayPal, of which he became CEO. Just two and a half years later, he was $165 million richer, following the sale of the company to eBay.
Most people might have expected to continue investing in Internet service companies such as this, but Musk had other plans. Even while running PayPal, he had put forward the idea of landing a miniature greenhouse on Mars (Mars Oasis) and had begun to explore how this could be done.
The difference is that Musk is a scientist by training. He has a degree in physics (plus one in economics) and had started a PhD in applied physics at Stanford before leaving to start life as an entrepreneur. X.com and PayPal made his initial fortune, but his ambitions were wider than that. More than a clever and charismatic businessman such as Richard Branson, more than a design- and detail-obsessed Steve Jobs, he wants to achieve big goals that are defined by his understanding of the basic limitations of physics.
This is driven largely by his pessimistic view of the future of human life. Giving us the wherewithal to colonise Mars could create an alternative future for a society that he believes likely to carry the seeds of its self-destruction, whether that be via the unintended consequences of artificial intelligence or the impact of our activities on the climate and environment of our home planet.
So, to build on his ‘Mars Oasis’ concept, he tried to buy surplus intercontinental ballistic missiles from the Russians, only to refuse to pay the price they demanded. He reckoned he could run a profitable business while reducing launch costs by 90%. $100 million went into setting up SpaceX in 2002, even before PayPal had been sold. Musk was still only 31 at the time.
Being CEO and Chief Technology Officer of such a company would be more than enough for most people, but in 2004 Musk became chairman of Tesla, following his large investment in the then year-old company. In 2008, he became CEO of Tesla and very much its public face. Despite missing a series of challenging production targets, the company has kept the confidence of investors and now has a stock market valuation greater than either Ford or General Motors.
Musk also was behind the launch of SolarCity, now a major manufacturer and supplier of solar panels and a wholly-owned subsidiary of Tesla. Supplying batteries for electric vehicles and as backup for renewable energy, the enormous Gigafactory 1 in Sparks, Nevada, is now ramping up production, and a second one is planned for Buffalo, New York.
None of this activity seems to have reduced the efforts of SpaceX, which recently used its giant Falcon heavy rocket to send a Tesla roadster into space. The company makes its own engines and can now recover booster rockets, a significant step towards the goal of cutting the cost of space travel by a factor of ten. The next development slated is an even more powerful launch vehicle than the Falcon heavy, known as the BFR (yes, it really does stand for what you’re thinking!).
Add in the Hyperloop concept for rapid transit (being taken to a practical level by Branson-backed Hyperloop One), the Boring Company (trying to reduce the cost of tunnelling by a factor of ten), plus OpenAI and Neuralink, which respectively seek to minimise the dangers of AI and use implants to merge human and artificial intelligence, and it seems that Musk’s ambitions and capabilities know few bounds.
I have to say that I was dubious about what he was offering via Tesla and SpaceX, when I thought of him as just another clever tech entrepreneur who had identified opportunities addressing high-profile societal concerns. But, whether or not you believe he is right to be so concerned about humankind’s future, the fact is that he is using the principles of physics, coupled with innovative design and economies of scale to develop practical and economic answers to the problems identified.
This is true science-based entrepreneurism that holds the potential to provide practical, game-changing leaps in technology. At the moment, many of his hugely ambitious targets are being missed, but investors are still happy to go along with that as long as they see real progress being made. Teslas are a common sight on our streets and SpaceX provides the preferred and most economic launch platform for now. One of his enterprises – most likely Tesla given the rate it is spending money – could go bust, but it is still likely to have transformed the car market in the meantime.
Elon Musk may be unique for the moment, but we can only hope he is blazing a trail for other visionaries who see hard opportunities justified on scientific principles and have the guts and determination to make them work. Whatever his motivation and however his various businesses pan out, he deserves a toast.