Tuesday, January 20, 2015
The Mysterious Mr. Musk - A Profile of Elon Musk, the Man behind Tesla Motors -- A Contribution by Beth Kelly
The Mysterious Mr. Musk - A Profile of Elon Musk, the Man behind Tesla Motors
Elon Musk has become one of the most renowned entrepreneurs in the world. He is an American citizen famous for his work in the technology industry, and for his involvement in ventures like PayPal, Zip2, SpaceX, Tesla Motors and Solar City. As of January 2015, his net worth was an estimated $11.7 billion. Behind him lies a force of creative scientists and engineers, who share Musk’s dreams of a more sustainable future. His dreams, encompassing everything from electric automobiles to reusable rockets and Mars colonies, are daring in their own right. It’s the audacity to see them through that sets Musk apart from the rest.
Born in South Africa in 1971, as a child he taught himself computer programming and created his first video game at age twelve. He later moved to Canada, and then to the United States where he attended the University of Pennsylvania. After obtaining two bachelor’s degrees, one in economics and one in physics, Musk intended to continue in school at California’s Stanford University. Instead, after two days of classes, he dropped out and started his first company. Elon Musk the entrepreneur was born.
Musk has never been afraid of working tirelessly towards his goals; sustaining his initiative through rounds of failure. At the age of twenty-eight, after selling his first tech company, he was already a millionaire. But unlike many who acquire wealth at an early age, he didn't retire or squander his new fortune. Instead, he plunged ahead and founded X.com, an online bank that would eventually become PayPal. As such, Musk is credited as being the inventor of a method of securing transferring money using only the recipient's e-mail.
When eBay purchased PayPal for $1.5 billion in 2002, Musk’s fortunes increased again. He quickly co-founded Space Exploration Technologies, or SpaceX, to pave the way for his next pet project - sending humans to colonize Mars. The company primarily develops and manufactures space launch vehicles, in hopes of advancing the state of rocket technology. Musk himself has expressed interest in living on Mars, going so far as to state an intent to retire on the planet. But for now, he remains Earth-bound with the rest of us. Not that he isn’t making waves there as well.
In 2004, Musk went ahead with Martin Eberhard to work with the young Tesla Motor company. Sustainability lies at the core of its mission, and Musk has long expressed sentiments that the current proliferation of gasoline-powered vehicles is unsustainable in the long term. Musk’s initiatives have inspired energy producers and automobile manufacturers alike, driving more companies to pursue alternative energy options (see this website for more information). In 2008 following the financial crisis, Musk took full leadership of the company as CEO, a position he maintains today.
The first vehicle produced by Tesla, the Roadster, entered general production in 2008 and was priced at $109,000 – not a comfortable price-point for most consumers. However, the firm's second offering, the Model S, was released to customers in 2012 at a more reasonable (though still exorbitant) $57,400. Tesla gradually seems to be at least trying to deliver on its commitment to bring the prices of alternative-energy cars down to a point where most customers can afford them.
Musk is also trying to change the way that automakers interact with the public. Although Tesla operates showrooms in dozens of states and internationally, there are no Tesla dealers; customers purchase their automobiles directly from the manufacturer. This promises to increase transparency and reduce prices although some jurisdictions have legislation making this model of selling cars difficult.
Tesla Motors achieved its first profitable month in July 2009, and generated $226 million in additional funding through an IPO in June 2010. Despite these signs of success in a difficult market, Musk believes that the true way forward for the company is to expand the electric car industry as a whole. He therefore took the unusual step to open Tesla Motors' patents and other intellectual property in July 2014. While such a decision may seem like corporate suicide, Musk is confident his daring move will incentivize the development of much-needed infrastructure, like EV charging stations. At the same time, the standardization of parts and economies of scale that could be achieved by sharing technologies may allow for cheaper prices and growing adoption of these vehicles among the public at large.
Teslas Motors' sales of electric vehicles have grown from 0 a decade ago to an estimated 11,000 units in the first nine months of 2014. While this is a remarkable accomplishment, the numbers pale in comparison to the figures for traditional cars. Elon Musk's decision to open up Tesla's patents could speed the growth of the entire market, from which his enterprise will likely reap immense benefits. However, it's possible that a lack of supporting infrastructure and the hostility of rivals' dealer networks may sink the Tesla brand before it truly makes a big impact on the automotive industry as a whole. Because it is such a high-profile and ambitious attempt to make electric vehicles a reasonably priced alternative to cars that burn fossil fuels, a failure at Tesla Motors could cause other investors and entrepreneurs to shy away from the idea of environmentally sustainable transportation technologies in the future.