4 Money Lessons You Could Learn From Elon Musk
Written by
Caitlyn Moorhead
Edited by
Cory Dudak
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Elon Musk — the current reigning richest man on the planet, with an estimated net worth of around $360 billion — is no stranger to controversy, speaking his mind or the world’s largest bottom line. Not everything Musk has done, financially speaking, has been exemplary. However, Musk’s best money moves are worthy of emulation.
Even if you don’t want to live or be like Musk, it couldn’t hurt to try to make money like he does. Here are four financial lessons you could learn from Elon.
Lesson 1: Invest Boldly
Musk co-founded the original X.com, later named PayPal, in 1999 and sold it to eBay for $1.4 billion in 2002, according to The Wall Street Journal. He collected $100 million from the deal, which was one of his original and best financial moves.
Essentially, he placed most of his net worth at the time into PayPal, which was quite a risky investment. The .com industry and peer-to-peer payment platforms were still very much in their infancy in a lot of ways.
Upon successful growth of this company, he sold it and was paid handsomely. However, instead of cashing out of the “entrepreneurship game” and living on the proceeds, he recycled his money into three more businesses which also took off as successes. This turned out to be quite a wise decision, given the state of his wealth today.
Lesson 2: Reinvest Your Profits
Musk has made billions of dollars from his ventures, but doesn’t sit on all of his profits without further growing his personal wealth. Simply put, he reinvests the money he makes into his vision of making “humanity a multi-planetary species and advancing clean energy and transportation.”
Whether you align with Musk’s ideals or not, you can’t argue with the financial results. This shows his passion, dedication and long-term thinking, which are essential tips to take in for any budding entrepreneur.
Calculated risks and failures are there to learn from, and Musk is not afraid to take bold and ambitious positions. This can include such endeavors as launching rockets into space or spearheading the electric car boom.
Lesson 3: Think Outside the Box
Musk begins his endeavors by asking the most basic of questions, usually related to finding cost savings or a better user experience. According to Brian Chevalier-Jordan, CMO at NationalBusinessCapital.com, by not taking anything for granted, he uncovers new insights that help him run his businesses better than his competitors.
“The lesson for the rest of us is: question what we’ve always thought was true about ourselves, our habits, and our behavior around money,” Chevalier-Jordan said. “For better or worse, Elon isn’t afraid to go somewhere where he has very little or no experience. That can lead to unexpected insights such as the idea that a tunnel under cities could help alleviate traffic if it’s used for public transportation. He used that concept to found not one, but two, companies: The Boring Company and Hyperloop.”
Lesson 4: Branding Is King
According to Chevalier-Jordan, while Musk may come across to some as immature, that might be a feature and not a bug.
“You certainly can’t say he isn’t having fun while becoming the world’s richest man. From the Tesla feature called Emissions Mode that makes fart noises — to the cage fight challenge that he proposed to Mark Zuckerberg — he puts his eccentricity on display. That has won him the loyalty of others who share his sense of humor. This trait has bought him a permanent place in many people’s minds,” he said.
Chevalier-Jordan added that while Musk is “clearly a king of bombast,” that doesn’t mean he’s not savvy with his communications.
“His marketing acumen is on point with names like The Boring Company for his tunnel-digging company, or the model names of Tesla’s cars that, when put together, spell S3XY (‘sexy’). When he turned Occupy Wall Street into a rallying cry for his rocket company, Space X, using the phrase ‘Occupy Mars,’ he showed branding is king.”
Yaël Bizouati-Kennedy contributed to the reporting for this article.
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