Tag Archives: Elon Musk

Liftoff: How Elon Musk Built SpaceX

At 1310 East Grand Avenue in El Segundo, just south of Los Angeles, sits a large white building. In 2002, it housed only about a dozen people. There wasn’t even a receptionist.

Deep in this building was a small group of cubicles, staffed by about a dozen men. This tiny group had an audacious goal: sending the first humans to Mars.

Their leader was a young internet entrepreneur named Elon Musk. He had just made $180 million from the sale of PayPal. Many men in his position would buy an island and relax, or perhaps begin a career in philanthrophy. But Elon toiled away in this nondescript warehouse instead, building the future.

This is the subject of an outstanding new book I just finished called Liftoff: Elon Musk and the Desperate Early Days That Launched SpaceX.

From this tiny team, Musk built SpaceX, which now does two thirds of all commercial satellite launches in the world and owns the most powerful rocket on earth, the Falcon Heavy. That small group of employees has mushroomed to nearly 10,000.

To go so far so fast, Musk needed the best people in the business, and he focused like a laser on finding them. One engineer’s wife got a job at Google in the Bay Area, which meant he couldn’t accept Musk’s offer to work at SpaceX. Undeterred, Musk called the CEO of Google and got the engineer’s wife a transfer to Los Angeles. Sure enough, he got the engineer he wanted.

Musk went so far as to personally interview the first 3000 people SpaceX hired. Musk paid less and his company was unproven, but he excelled at inspiring people to join him to revolutionize space travel.

Even with Musk’s drive and a superb team, SpaceX faced many struggles. By 2008, they had three failed flights and barely a month’s worth of cash left. Even Elon’s considerable fortune had run dry supporting both SpaceX and Tesla. But Musk and his team stayed focused and successfully launched a rocket into orbit in the nick of time. This achievement won them a NASA contract that kept the company alive.

SpaceX questioned everything about how business is normally done in aerospace. Most companies buy parts from established suppliers, but SpaceX built almost everything itself, substantially lowering its costs. For the parts it did buy elsewhere, SpaceX ignored common practice as well. Instead of paying in 30 days, SpaceX paid in as little as 24 hours. This got their orders prioritized, which helped them move faster than other rocket companies.

Today, only one other private company, Rocket Lab, has reached orbit. Jeff Bezos’ Blue Origin, despite all his money, has never reached orbit. Indeed, SpaceX is so dominant that customers sometimes spread around a few of their orders, just to make sure its competitors don’t all go out of business.

If I had seen Musk in that empty warehouse twenty years ago, I would never have believed what SpaceX would become. But Musk saw it, and stopped at nothing to get there.

When the first man steps on Mars, will it be Musk?

Dig into these posts for more on Elon Musk and space:

Photo: “SpaceX Dragon Propulsive Descent Landing Test” by NASAKennedy is marked with CC PDM 1.0

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 and returns have been good so far. More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get your management fees waived for 90 days. With their 1% management fee, this could save you $250 on a $100,000 account. I will also get a fee waiver for 90-365 days, depending on what type of account you open.

iHerb

The only place I buy vitamins and supplements. I recently placed an order and received it in less than 48 hours with free shipping! I compared the prices and they were lower than Amazon. I also love how they test a lot of the vitamins so that you know you’re getting what the label says. This isn’t always the case with supplements.

Use this link to save 5%! I’ll also get 5% of however much you spend, at no cost to you.

Misfits Market

My wife and I have gotten organic produce shipped to our house by Misfits for over a year. It’s never once disappointed me. Every fruit and vegetable is super fresh and packed with flavor. I thought radishes were cold, tasteless little lumps at salad bars until I tried theirs! They’re peppery, colorful and crunchy! I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $10 on your first order. I’ll also get $10.

In Norway, 60% of Cars Sold are Electric

Norway’s electric car market is powering ahead, with most new cars registered in September either fully electric or hybrids.

Electric cars accounted for 61.5% of the 15,552 cars registered that month in the country. When hybrids are included, the total jumps up to 89%.

The new Volkswagen ID.3 was the bestselling car, with 12.8% of sales, followed by the Tesla Model 3 and the Polestar 2.

Globally, too, we could be on track for an electric car breakthrough as battery technology gets less expensive. The cost of a lithium-ion battery pack for an electric car fell 87% from 2010 to 2019, according to research by BloombergNEF.

More here.

In the US, by contrast, only 2% of new car registrations are electric.

So why is Norway leading the world while the US, a major producer of electric vehicles, straggles far behind? Are Norwegians just a lot more environmentally conscious?

Well, not exactly. Norway currently has big tax incentives for buying an electric car as opposed to an internal combustion one. Those incentives are set to be pared back this year, but will still provide a tax advantage for electrics. US tax incentives are less generous, which is one major factor behind slower adoption.

Another factor: gas costs the equivalent of about $8 a gallon in Norway, compared to about $2.75 in my neighborhood in New Jersey.

High gas prices and huge tax incentives mean that Norwegians don’t have to be environmentalists to choose an electric car. They just have to be frugal.

Dig into these posts for more on business and technology:

If you found this post interesting, please share it on Twitter/Reddit/Facebook/etc. using the buttons below. This helps more people find the blog! And please leave a comment at the bottom of the page letting me know what you think and what other information you’re interested in!

Check out the Stuff I Use page for some great deals on products and services I use to improve my health and productivity. They just might help you too!

Photo: “IMG46347-2” by odd.bakken is licensed under CC BY-NC-SA 2.0

Elon Musk’s Secret Battery May Be the World’s Largest

Elon Musk’s Tesla, Inc. has connected a massive battery to the Texas power grid:

A Tesla subsidiary registered as Gambit Energy Storage LLC is quietly building a more than 100 megawatt energy storage project in Angleton, Texas, a town roughly 40 miles south of Houston. A battery that size could power about 20,000 homes on a hot summer day.

This megabattery may be the world’s largest, surpassing another Tesla project in Australia:

Tesla’s battery project in South Australia, launched in 2017, is adjacent to a wind farm and can store surplus electricity generated on gusty nights for daytime demand. At 100 megawatts, it was the largest battery project in the world at its launch.

Battery packs like these could make it easier to store renewable energy when the sun is shining and the wind is blowing. And the energy market is so big, a major push in this area could help justify Tesla’s lofty valuation. From the Bloomberg report:

“I think long-term Tesla Energy will be roughly the same size as Tesla Automotive,” Musk said during an earnings call in July 2020. “The energy business is collectively bigger than the automotive business.”

Battery prices are falling precipitously, making such a future increasingly plausible. Prices have fallen from $668/kWh in 2013 to $137 last year, a decrease of nearly 80%.

For more on Tesla, electric vehicles, and financial markets, check out these posts:

If you found this post interesting, please share it on Twitter/LinkedIn/email using the buttons below. This helps more people find the blog! And please leave a comment at the bottom of the page letting me know what you think and what other information you’re interested in!

Check out the Stuff I Use page for some great deals on products and services I use to improve my health and productivity. They just might help you too! 

Photo: “Elon Musk” by dmoberhaus is licensed under CC BY 2.0

Tesla’s Shares Are Priced For a Future Where Tesla Makes Every Car on Earth

Reading about the enormous run-up in shares of Tesla, Inc., I wondered something…is Tesla bigger than the entire rest of the auto industry?

The answer is: almost. Tesla’s market cap ($655 billion), is nearly equal to the combined market caps of Toyota, GM, Ford, VW, Daimler, Fiat, BMW, Honda, Hyundai, Nissan, Mazda, Subaru and Aston Martin ($750 billion), per Yahoo Finance data. That’s pretty much the auto industry, with the notable exception of SAIC of China.

So, will Tesla make every car on earth? Probably not. Indeed, what scenario investors are expecting is unclear:

It doesn’t make sense that nearly all the cars sold in the world in the future will be Tesla vehicles, nor does it make sense that the size of the global auto market will double.

Therefore, Tesla’s massive market cap compared to the largest legacy auto companies in the world seems to suggest that investors believe other businesses outside of pure auto unit sales will play an extremely large role in Tesla’s future business model.

Tesla has come out with some interesting non-auto products like its solar roof tiles and Power Wall, but does that make it worth three times as much as Toyota, the next largest auto company by market cap ($213 billion)?

Keep in mind, Toyota sold almost 10 million vehicles last year. That’s nearly 20 times as many as Tesla.

I’m a huge fan of Tesla and Elon Musk. I think it’s an amazing company and Musk is one of the greatest innovators and entrepreneurs of all time. But, it’s hard to justify the stock’s current level.

If you found this post interesting, please share it on Twitter/LinkedIn/email using the buttons below. This helps more people find the blog! And please leave a comment at the bottom of the page letting me know what you think and what other information you’re interested in!

Photo: “Tesla Chairman Elon Musk” by kqedquest is licensed under CC BY-NC 2.0