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HomeNewsHow Did Elon Musk Make His Money?

How Did Elon Musk Make His Money?

Billionaire success tales abound. They vary from tech geniuses to entrepreneur moguls and outdated cash inheritors. 

Mark Zuckerberg, as an illustration, created Fb in a bid to streamline connectivity amongst Harvard College college students — a novel tech concept on the time. The positioning ballooned into one of many greatest and most important social media firms in historical past, making Zuckerberg one of many planet’s wealthiest males. 

Jeff Bezos kick-started Amazon.com Inc. as a web based bookstore. Presently valued at over $1 trillion, the corporate dominates e-commerce, placing Bezos amongst Earth’s prime two wealthiest males. 

Warren Buffet of Berkshire Hathaway — the fifth-richest man on Earth, constructed his wealth by way of a refined however calculated, low-risk funding method that spanned many years. 

After which there’s Elon Musk, who, not like most billionaires, amassed his fortune by profitable enterprise operations somewhat than a single massive success.

Hailed as a millennial genius, Musk rose to prominence because the CEO of electrical automotive firm Tesla Inc. (NASDAQ: TSLA) and his personal aerospace enterprise SpaceX. The whole thing of his property makes him the wealthiest individual alive at present. 

As anticipated, being the richest and most well-known billionaire has privileges. And Musk tries to make use of them in one of the best ways he deems match. As an illustration, he can afford to troll Manchester United followers or throw jabs at President Joe Biden. For Musk, a part of this privilege contains courting different well-known folks like screen-goddess Amber Heard, actor Talulah Riley, singer Grimes and a bunch of others. 

He’s involved about inhabitants decline. And what higher approach to present that than fathering 10 youngsters? To this point, Musk’s greatest 2022 information is his deserted $44 billion try and take over Twitter. The social media firm has filed a authorized continuing in opposition to him.

How did Musk get so rich? Benzinga appears to be like at how Musk made his cash, how that informs his enterprise choices and the way buyers can take classes from his journey.

Musk’s Early Historical past

Musk was born on June 28, 1971, in Pretoria, Transvaal in South Africa, the place he grew up. His father, Errol Musk, was an engineer, and his mom, Maye Musk, a dietitian and a supermodel — the oldest mannequin to look in a CoverGirl marketing campaign. Musk’s household was nicely off. Because the son of a mining baron, he had a comparatively good head begin on his journey to being the wealthiest man alive. 

Musk reportedly had a outstanding expertise for computer systems as a toddler, creating his personal online game at 12 and promoting it for $500. At 17, Musk emigrated to Canada to flee obligatory army service in apartheid South Africa. Musk started his tertiary training on the Queen’s College of Ontario and subsequently transferred to the College of Pennsylvania in 1992, majoring in physics and economics. 

Whereas on the College of Pennsylvania, Musk obtained his first style of a risk-averse enterprise enterprise when he and some associates leased a house exterior of faculty and transformed it right into a nightclub.

On graduating, Musk briefly moved on to grad college. He enrolled in a physics Ph.D. program at Stanford College in California, then dropped out after two days. Like different budding entrepreneurs, Musk determined to stake his lot within the web growth. And so, along with his brother Kimbal, Musk based what would go on to be his first profitable enterprise — Zip2. 

In 1999, they offered the corporate to Compaq Pc Corp. for $307 million, and Musk netted $22 million. This laid the muse for his later enterprise exploits.

Musk’s Firms

Musk has amassed billions of {dollars} by his involvement in quite a few companies, from beginning PayPal and SpaceX to Tesla. His fairness in Tesla contributes considerably to his internet price. This is a overview of Musk’s journey from enthusiastic entrepreneur to international monetary magnate. 


Zip2 was Musk’s first enterprise brainchild. It was a web-enabled yellow web page with a map that supplied on-line metropolis guides whereas doubling as a listing for newspapers and different companies. It was a profitable try and reap revenue by leveraging the web growth of the time. With key founding capital sourced from household, the Musk brothers partnered with buyers like Greg Kouri. 

The corporate quickly grew large enough to be a magnet for pc manufacturing big Compaq, which coughed up greater than $340 million for Zip2 in 1999. Elon Musk’s 7% firm shares meant he walked dwelling with $22 million in his pocket — changing into a multimillionaire at 27. 

To rejoice, Elon Musk purchased a $1 million McLaren F1 supercar — an motion he later admitted to CNN was out of character for him. Musk by accident wrecked the automotive a yr later when attempting to indicate its acceleration. For Musk, the profitable Zip2 deal was only a starter. Musk was already laser-focused on his subsequent huge enterprise enterprise — X.com.

X.com and PayPal

In 1999, Elon Musk co-founded X.com, one other internet-based startup. X.com was one of many earliest fintech firms to emerge. On the time, the corporate centered on offering on-line monetary fee companies by incentivizing signups. The idea was modern and eased digital fund transfers. After one month of operations, X.com added over 200,000 new clients. However regardless of plowing tens of millions of his earnings from Zip2 into it, buyers deemed Musk inexperienced to be CEO.

In March 2000, X.com merged with shut competitor Confinity, a software program firm co-founded by famed angel investor Peter Thiel. The merger birthed a fintech fee switch big now referred to as Paypal. Musk returned to the scene as CEO of the newly merged PayPal. Though PayPal stays certainly one of Musk’s profitable firms, it had a rocky starting. At one level in 1999, it was voted among the many worst enterprise concepts, and Musk was ousted as CEO.

In 2002, eBay purchased PayPal for about $1.5 billion in inventory, and Musk netted roughly $180 million post-tax. However Musk didn’t seem like slowing down, as he already had some concepts within the works. With the big payout from PayPal’s sale, the entrepreneur invested in SpaceX, Tesla and SolarCity.

Musk used nearly all of his earnings from his PayPal funding to ascertain House Exploration Applied sciences Corp., also referred to as SpaceX. He based the corporate with the objective of colonizing Mars.

With $100 million from his fortune, he launched the corporate in 2002 and have become the corporate’s CEO and chief engineer. Nonetheless, the corporate suffered a number of failed launches, nearly placing it out of enterprise. Happily, Musk’s investments ultimately paid off. In 2008, SpaceX secured a $1.6 billion cope with NASA after its first profitable rocket launch.

SpaceX launched its first crewed house flight in Might 2020. In August 2022, the corporate was valued at $127 billion, a $27 billion enhance from the earlier yr’s $120 billion valuation. SpaceX is now the only producer of reusable rockets that may land vertically. This feat has landed it an unique cope with the U.S. authorities and NASA.

Musk’s brilliance can be seen in SpaceX’s Starlink constellation pilot challenge. The Starlink challenge, launched in 2015, goals to offer reasonably priced web worldwide utilizing a constellation of low-orbit satellites.

Tesla Inc

A yr after establishing SpaceX, Musk invested over $6 million into Tesla Motors, becoming a member of the ranks of the corporate’s board of administrators. Martin Eberhard and Marc Tarpenning initially based Tesla in 2003 with the imaginative and prescient of producing electrical sports activities automobiles that may compete favorably with their diesel counterparts in effectivity and driving vary. 

As the first shareholder, Musk grew to become CEO of Tesla in 2008 and remodeled the corporate into one of the vital famend international electrical automobile (EV) producers. Musk’s tenure at Tesla has not been with out incident. Ousting Martin Eberhard and taking up because the CEO was controversial. The company additionally had its share of issues that just about bankrupted it on a number of events. 

Tesla has change into an EV juggernaut, controlling over 60% of the U.S. EV market with a market capitalization of about $950.48 billion — down from $1 trillion in 2021 due to provide chain woes and inflationary strain. Musk owns a large portion of this inventory. 

Musk offered some percentages of his shares to finance his now-abandoned Twitter acquisition. He presently holds 14.9% of the corporate, which quantities to over $141 billion and excludes issuable inventory choices and compensation packages. Tesla accounts for many of Musk’s internet price.

In 2016, Musk based The Boring Co., a transportation and utility tunneling enterprise, and Neuralink, a neurotechnology startup. He has invested at the very least $100 million in every firm. These two most up-to-date endeavors illuminate the mentality that made Musk the person he’s at present. Each tasks are very speculative. 

Neuralink is valued at over $500 million and goals to create telepathic connections between people and machines by way of sensors. Though no human scientific trial has been documented, Neuralink’s scientific trial utilizing pigs confirmed spectacular outcomes. 

The Boring Co. seeks to offer fast point-to-point city-wide transportation by tunnels, thereby fixing the site visitors issues that plague huge cities. The corporate is valued at roughly $5.7 billion and has already accomplished one loop system in Las Vegas. 

Though few analysts doubt the long-term profitability of both of those enterprise ventures, Musk makes his dwelling by taking enormous dangers. The identical technique, which concerned investing tens of millions of {dollars} on unimaginably difficult tasks, is what made Musk the world’s richest individual.

Does Elon Musk Reinvest in His Companies?

On the face of it, Musk’s lengthy string of dangerous but profitable investments could come off as rash and impulsive. Nonetheless, when constructively analyzed, you discover a big-money reinvestment sample that persistently delivers outcomes. 

Musk reinvested a big chunk of the $22 million he reaped from Zip2 into his subsequent enterprise enterprise X.com. In opposition to all odds, X.com thrived. And due to its merger with Confinity Inc. to type PayPal, it grew to become tremendous aggressive and worthwhile, incomes Musk an after-tax revenue of $180 million when it offered to eBay for $1.5 billion. 

Based on Musk, of his $180 million revenue from PayPal, he invested $100 million into SpaceX, $70 million into Tesla and $10 million into SolarCity Corp. So actually, he reinvested all his fortune from the PayPal deal into his new enterprise ventures. 

Musk had a transparent imaginative and prescient of what he wished to perform and was keen to take dangers to make it occur. The consequence speaks for itself. Whereas such risk-taking could seem reckless, folks are inclined to overlook that Musk takes calculated possibilities. He had a objective and a imaginative and prescient for the longer term, and he labored laborious to realize each.

Musk’s Internet Price

Musk’s funding in Tesla and SpaceX ushered him into the billionaires membership and, subsequently, to change into the wealthiest man alive. Tesla started producing and supplying its first mass-market autos in 2012. At the moment, Musk’s internet price was within the tens of millions. He grew to become a billionaire in 2013 when the corporate began manufacturing and supplying the Mannequin X. 

Lately, Tesla shares grew from $61 in 2019 to over $300 per share after its inventory break up. In October 2021, Tesla joined its friends Apple and Microsoft within the $1 trillion membership when its inventory exceeded $1,000 per share. Inside the similar interval, Musk’s internet price grew to over $203 billion, edging out Bezos, Gates and Zuckerberg to change into the world’s richest man. 

His 48% stake in SpaceX accounts for the rest of his wealth. With SpaceX’s valuation at round $127 billion, Musk’s share within the rocket maker plus his share from Tesla and different property put his internet price solidly above $210 billion.

Enterprise Suggestions From Musk

Musk has overcome quite a few private and enterprise challenges on his journey to the highest. His recommendation is invaluable as a result of knowledge comes with expertise, and he has an abundance of it. This is a overview of some success suggestions from Musk’s podcast interviews that may assist budding and well-established entrepreneurs succeed. 

Musk’s first tip for fulfillment is to play to your energy.

“A whole lot of the time, the folks you need as leaders are the individuals who do not wish to be leaders,” he mentioned. “Forcing your self to do something or be anybody you do not need to all the time results in disappointment. Play to your strengths, and you will succeed.” 

All of Musk’s high-paying investments are in sectors the place he’s strongly grounded. The identical logic applies to private investments and enterprise operations.

Musk advises buyers and budding entrepreneurs to attempt to give again to society. 

“Attempt to have a constructive internet contribution to society,” he mentioned “That is one thing to intention for.”

Musk says giving again one thing constructive to society will return extra dividends for everybody and finally you.

He encourages entrepreneurs to learn a variety of books and “to ingest as a lot info as you’ll be able to and develop good normal data, so that you at the very least have a tough lay of the land of the data panorama.”

Lastly, Musk advises entrepreneurs to be taught and embody the artwork of communication, making it clear that communication is the important thing to success, together with wealth constructing.

“Speak to folks from totally different walks of life and industries, professions and expertise,” he mentioned. “Be taught as a lot as doable.”

Musk values connection and studying as a tradition and as a species. Based on the entrepreneur, this perspective is a significant contributor to the success he has loved.

Regularly Requested Questions

Questions & Solutions


Musk’s shares in Tesla and SpaceX primarily made him rich. His mixed stake within the two firms is price over $200 billion.


Musk began his entrepreneurship journey within the mid-Nineteen Nineties along with his funding in Zip2, a web-enabled listing that supplied on-line metropolis guides. He offered the corporate and made about $22 million, which served as the muse of his entrepreneurship conquest.

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