Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future

Top Gear,
a popular British television show, ripped the
Roadster apart, making it look as if the car had run out of juice during a road test. “People joke about the
Tesla Death Watch and all that, but it was harsh,” said Kimbal Musk. “One day there were fifty articles
about how Tesla will die.”
Then, in October 2008 (just a couple weeks after SpaceX’s successful launch), Valleywag appeared
on the scene again. First it ridiculed Musk for officially taking over as CEO of Tesla and replacing Drori,
on the grounds that Musk had just lucked into his past successes. It followed that by printing a tell-all e-
mail from a Tesla employee. The report said that Tesla had just gone through a round of layoffs, shut
down its Detroit office, and had only $9 million left in the bank. “We have over 1,200 reservations, which
manes 
[sic]
we’ve taken multiples of tens of millions of cash from our customers and have spent them
all,” the Tesla employee wrote. “Meanwhile, we only delivered less than 50 cars. I actually talked a

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close friend of mine into putting down $60,000 for a Tesla Roadster. I cannot conscientiously be a
bystander anymore and allow my company to deceive the public and defraud our dear customers. Our
customers and the general public are the reason Tesla is so loved. The fact that they are being lied to is
just wrong.”
*
Yes, Tesla deserved much of the negative attention. Musk, though, felt like the 2008 climate with the
hatred of bankers and the rich had turned him into a particularly juicy target. “I was just getting pistol-
whipped,” Musk said. “There was a lot of schadenfreude at the time, and it was bad on so many levels.
Justine was torturing me in the press. There were always all these negative articles about Tesla, and the
stories about SpaceX’s third failure. It hurt really bad. You have these huge doubts that your life is not
working, your car is not working, you’re going through a divorce and all of those things. I felt like a pile
of shit. I didn’t think we would overcome it. I thought things were probably fucking doomed.”
When Musk ran through the calculations concerning SpaceX and Tesla, it occurred to him that only
one company would likely even have a chance at survival. “I could either pick SpaceX or Tesla or split
the money I had left between them,” Musk said. “That was a tough decision. If I split the money, maybe
both of them would die. If I gave the money to just one company, the probability of it surviving was
greater, but then it would mean certain death for the other company. I debated that over and over.” While
Musk meditated on this, the economy worsened quickly and so too did Musk’s financial condition. As
2008 came to an end, Musk had run out of money.
Riley began to see Musk’s life as a Shakespearean tragedy. Sometimes Musk would open up to her
about the issues, and other times he retreated into himself. Riley spied on Musk while he read e-mail and
watched him grimace as the bad news poured in. “You’d witness him having these conversations in his
head,” she said. “It’s really hard to watch someone you love struggle like that.” Because of the long hours
that he worked and his eating habits, Musk’s weight fluctuated wildly. Bags formed under his eyes, and
his countenance started to resemble that of a shattered runner at the back end of an ultra-marathon. “He
looked like death itself,” Riley said. “I remember thinking this guy would have a heart attack and die. He
seemed like a man on the brink.” In the middle of the night, Musk would have nightmares and yell out. “He
was in physical pain,” Riley said. “He would climb on me and start screaming while still asleep.” The
couple had to start borrowing hundreds of thousands of dollars from Musk’s friend Skoll, and Riley’s
parents offered to remortgage their house. Musk no longer flew his jet back and forth between Los Angles
and Silicon Valley. He took Southwest.
Burning through about $4 million a month, Tesla needed to close another major round of funding to get
through 2008 and stay alive. Musk had to lean on friends just to try to make payroll from week to week, as
he negotiated with investors. He sent impassioned pleas to anyone he could think of who might be able to
spare some money. Bill Lee invested $2 million in Tesla, and Sergey Brin invested $500,000. “A bunch
of Tesla employees wrote checks to keep the company going,” said Diarmuid O’Connell, the vice
president of business development at Tesla. “They turned into investments, but, at the time, it was twenty-
five or fifty thousand dollars that you didn’t expect to see again. It just seemed like holy shit, this thing is
going to crater.” Kimbal had lost most of his money during the recession when his investments bottomed
out but sold what he had left and put it into Tesla as well. “I was close to bankruptcy,” Kimbal said. Tesla
had set the prepayments that customers made for the Roadsters aside, but Musk now needed to use that
money to keep the company going and soon those funds were gone, too. These fiscal maneuvers worried
Kimbal. “I’m sure Elon would have found a way to make things right, but he definitely took risks that
seemed like they could have landed him in jail for using someone else’s money,” he said.
In December 2008, Musk mounted simultaneous campaigns to try to save his companies. He heard a
rumor that NASA was on the verge of awarding a contract to resupply the space station. SpaceX’s fourth

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launch had put it in a position to receive some of this money, which was said to be in excess of $1 billion.
Musk reached out through some back channels in Washington and found out that SpaceX might even be a
front-runner for the deal. Musk began doing everything in his power to assure people that the company
could meet the challenge of getting a capsule to the ISS. As for Tesla, Musk had to go to his existing
investors and ask them to pony up for another round of funding that needed to close by Christmas Eve to
avoid bankruptcy. To give the investors some measure of confidence, Musk made a last-ditch effort to
raise all the personal funds he could and put them into the company. He took out a loan from SpaceX,
which NASA approved, and earmarked the money for Tesla. Musk went to the secondary markets to try to
sell some of his shares in SolarCity. He also seized about $15 million that came through when Dell
acquired a data center software start-up called Everdream, founded by Musk’s cousins, in which he had
invested. “It was like the fucking Matrix,” Musk said, describing his financial maneuvers. “The
Everdream deal really saved my butt.”
Musk had cobbled together $20 million, and asked Tesla’s existing investors—since no new investors
materialized—to match that figure. The investors agreed, and on December 3, 2008, they were in the
process of finalizing the paperwork for the funding round when Musk noticed a problem. VantagePoint
Capital Partners had signed all of the paperwork except for one crucial page. Musk phoned up Alan
Salzman, VantagePoint’s cofounder and managing partner, to ask about the situation. Salzman informed
Musk that the firm had a problem with the investment round because it undervalued Tesla. “I said, ‘I’ve
got an excellent solution then. Take my entire portion of the deal. I had a real hard time coming up with the
money. Based on the cash we have in the bank right now, we will bounce payroll next week. So unless
you’ve got another idea, can you either just participate as much as you’d like, or allow the round to go
through because otherwise we will be bankrupt.’” Salzman balked and told Musk to come in the
following week at 7 
A.M
. to present to VantagePoint’s top brass. Not having a week of time to work with,
Musk asked to come in the next day, and Salzman refused that offer, forcing Musk to continue taking on
loans. “The only reason he wanted the meeting at his office was for me to come on bended knee begging
for money so he could say, ‘No,’” Musk theorized. “What a fuckhead.”
VantagePoint declined to speak about this period, but Musk believed that Salzman’s tactics were part
of a mission to bankrupt Tesla. Musk feared that VantagePoint would oust him as CEO, recapitalize Tesla,
and emerge as the major owner of the carmaker. It could then sell Tesla to a Detroit automaker or focus on
selling electric drivetrains and battery packs instead of making cars. Such reasoning would have been
quite practical from a business standpoint but did not match up with Musk’s goals for Tesla.
“VantagePoint was forcing that wisdom down the throat of an entrepreneur who wanted to do something
bigger and bolder,” said Steve Jurvetson, a partner at Draper Fisher Jurvetson and Tesla investor.
“Maybe they’re used to a CEO buckling, but Elon doesn’t do that.” Instead, Musk took another huge risk.
Tesla recharacterized the funding as a debt round rather than an equity round, knowing that VantagePoint
could not interfere with a debt deal. The tricky part of this strategy was that investors like Jurvetson who
wanted to help Tesla were put in a bind because venture capital firms are not structured to do debt deals,
and convincing their backers to alter their normal rules of engagement for a company that could very well
go bankrupt in a matter of days would be a very tough ask. Knowing this, Musk bluffed. He told the
investors that he would take another loan from SpaceX and fund the entire round—all $40 million—
himself. The tactic worked. “When you have scarcity, it naturally reinforces greed and leads to more
interest,” Jurvetson said. “It was also easier for us to go back to our firms and say, ‘Here is the deal. Go
or no go?’” The deal ended up closing on Christmas Eve, hours before Tesla would have gone bankrupt.
Musk had just a few hundred thousand dollars left and could not have made payroll the next day. Musk
ultimately put in $12 million, and the investment firms put up the rest. As for Salzman, Musk said, “He

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should be ashamed of himself.”
At SpaceX, Musk and the company’s top executives had spent most of December in a state of fear.
According to reports in the press, SpaceX, the onetime front-runner for the large NASA contract, had
suddenly lost favor with the space agency. Michael Griffin, who had once almost been a cofounder of
SpaceX, was the head of NASA and had turned on Musk. Griffin did not care for Musk’s aggressive
business tactics, seeing him as borderline unethical. Others have suggested that Griffin ended up being
jealous of Musk and SpaceX.
*
 On December 23, 2008, however, SpaceX received a shock. People inside
NASA had backed SpaceX to become a supplier for the ISS. The company received $1.6 billion as
payment for twelve flights to the space station. Staying with Kimbal in Boulder, Colorado, for the
holidays, Musk broke down in tears as the SpaceX and Tesla transactions processed. “I hadn’t had an
opportunity to buy a Christmas present for Talulah or anything,” he said. “I went running down the fucking
street in Boulder, and the only place that was open sold these shitty trinkets, and they were about to close.
The best thing I could find were these plastic monkeys with coconuts—those ‘see no evil, hear no evil’
monkeys.”
For Gracias, the Tesla and SpaceX investor and Musk’s friend, the 2008 period told him everything
he would ever need to know about Musk’s character. He saw a man who arrived in the United States with
nothing, who had lost a child, who was being pilloried in the press by reporters and his ex-wife and who
verged on having his life’s work destroyed. “He has the ability to work harder and endure more stress
than anyone I’ve ever met,” Gracias said. “What he went through in 2008 would have broken anyone else.
He didn’t just survive. He kept working and stayed focused.” That ability to stay focused in the midst of a
crisis stands as one of Musk’s main advantages over other executives and competitors. “Most people who
are under that sort of pressure fray,” Gracias said. “Their decisions go bad. Elon gets hyperrational. He’s
still able to make very clear, long-term decisions. The harder it gets, the better he gets. Anyone who saw
what he went through firsthand came away with more respect for the guy. I’ve just never seen anything
like his ability to take pain.”

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9

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LIFTOFF
T
HE FALCON 9 HAS BECOME SPACEX’S WORKHORSE. The rocket looks—let’s face it—like a
giant white phallus. It stands 224.4 feet tall, is 12 feet across, and weighs 1.1 million pounds. The rocket
is powered by nine engines arranged in an “octaweb” pattern at its base with one engine in the center and
eight others encircling it. The engines connect to the first stage, or the main body of the rocket, which
bears the blue SpaceX insignia and an American flag. The shorter second stage of the rocket sits on top of
the first and is the one that actually ends up doing things in space. It can be outfitted with a rounded
container for carrying satellites or a capsule capable of transporting humans. By design, there’s nothing
particularly flashy about the Falcon 9’s outward appearance. It’s the spaceship equivalent of an Apple
laptop or a Braun kettle—an elegant, purposeful machine stripped of frivolity and waste.
SpaceX sometimes uses Vandenberg Air Force Base in Southern California to send up these Falcon 9
rockets. Were it not owned by the military, the base would be a resort. The Pacific Ocean runs for miles
along its border, and its grounds have wide-open shrubby fields dotted by green hills. Nestled into one
hilly spot just at the ocean’s edge are a handful of launchpads. On launch days, the white Falcon 9 breaks
up the blue and green landscape, pointing skyward and leaving no doubt about its intentions.
About four hours before a launch, the Falcon 9 starts getting filled with an immense amount of liquid
oxygen and rocket-grade kerosene. Some of the liquid oxygen vents out of the rocket as it awaits launch
and is kept so cold that it boils off on contact with the metal and air, forming white plumes that stream
down the rocket’s sides. This gives the impression of the Falcon 9 huffing and puffing as it limbers up
before the journey. The engineers inside of SpaceX’s mission control monitor these fuel systems and all
manner of other items. They chat back and forth through headsets and begin cycling through their launch
checklist, consumed by what people in the business call “go fever” as they move from one approval to the
next. Ten minutes before launch, the humans step out of the way and leave the remaining processes up to
automated machines. Everything goes quiet, and the tension builds until right before the main event. That’s
when, out of nowhere, the Falcon 9 breaks the silence by letting out a loud gasp.
A white latticed support structure pulls away from its body. The T-minus-ten-seconds countdown
begins. Nothing much happens from ten down to four. At the count of three, however, the engines ignite,
and the computers conduct a last, oh-so-rapid, health check. Four enormous metal clamps hold the rocket
down, as computing systems evaluate all nine engines and measure if there’s sufficient downward force
being produced. By the time zero arrives, the rocket has decided that all is well enough to go through with
its mission, and the clamps release. The rocket goes to war with inertia, and then, with flames surrounding
its base and snow-thick plumes of the liquid oxygen filling the air, it shoots up. Seeing something so large
hold so straight and steady while suspended in midair is hard for the brain to register. It is foreign,
inexplicable. About twenty seconds after liftoff, the spectators placed safely a few miles away catch the
first faceful of the Falcon 9’s rumble. It’s a distinct sound—a sort of staccato crackling that arises from
chemicals whipped into a violent frenzy. Pant legs vibrate from shock waves produced by a stream of
sonic booms coming out of the Falcon 9’s exhaust. The white rocket climbs higher and higher with
impressive stamina. After about a minute, it’s just a red spot in the sky, and then—poof—it’s gone. Only a
cynical dullard could come away from witnessing this feeling anything other than wonder at what man can

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accomplish.
For Elon Musk, this spectacle has turned into a familiar experience. SpaceX has metamorphosed from
the joke of the aeronautics industry into one of its most consistent operators. SpaceX sends a rocket up
about once a month, carrying satellites for companies and nations and supplies to the International Space
Station. Where the Falcon 1 blasting off from Kwajalein was the work of a start-up, the Falcon 9 taking
off from Vandenberg is the work of an aerospace superpower. SpaceX can undercut its U.S. competitors
—Boeing, Lockheed Martin, Orbital Sciences—on price by a ridiculous margin. It also offers U.S.
customers a peace of mind that its rivals can’t. Where these competitors rely on Russian and other foreign
suppliers, SpaceX makes all of its machines from scratch in the United States. Because of its low costs,
SpaceX has once again made the United States a player in the worldwide commercial launch market. Its
$60 million per launch cost is much less than what Europe and Japan charge and trumps even the relative
bargains offered by the Russians and Chinese, who have the added benefit of decades of sunk government
investment into their space programs as well as cheap labor.
The United States continues to take great pride in having Boeing compete against Airbus and other
foreign aircraft makers. For some reason, though, government leaders and the public have been willing to
concede much of the commercial launch market. It’s a disheartening and shortsighted position. The total
market for satellites, related services, and the rocket launches needed to carry them to space has exploded
over the past decade from about $60 billion per year to more than $200 billion.
11
 A number of countries
pay to send up their own spy, communication, and weather satellites. Companies then turn to space for
television, Internet, radio, weather, navigation, and imaging services. The machines in space supply the
fabric of modern life, and they’re going to become more capable and interesting at a rapid pace. A whole
new breed of satellite makers has just appeared on the scene with the ability to answer Google-like
queries about our planet. These satellites can zoom in on Iowa and determine when cornfields are at peak
yields and ready to harvest, and they can count cars in Wal-Mart parking lots throughout California to
calculate shopping demand during the holiday season. The start-ups making these types of innovative
machines must often turn to the Russians to get them into space, but SpaceX intends to change that.
The United States has remained competitive in the most lucrative parts of the space industry, building
the actual satellites and complementary systems and services to run them. Each year, the United States
makes about one-third of all satellites and takes about 60 percent of the global satellite revenue. The
majority of this revenue comes from business done with the U.S. government. China, Europe, and Russia
account for almost all of the remaining satellite sales and launches. It’s expected that China’s role in the
space industry will increase, while Russia has vowed to spend $50 billion on revitalizing its space
program. This leaves the United States dealing with two of its least-favored nations in space matters and
doing so without much leverage. Case in point: the retirement of the space shuttle made the United States
totally dependent on the Russians to get astronauts to the ISS. Russia gets to charge $70 million per
person for the trip and to cut the United States off as it sees fit during political rifts. At present, SpaceX
looks like the best hope of breaking this cycle and giving back to America its ability to take people into
space.
SpaceX has become the free radical trying to upend everything about this industry. It doesn’t want to
handle a few launches per year or to rely on government contracts for survival. Musk’s goal is to use
manufacturing breakthroughs and launchpad advances to create a drastic drop in the cost of getting things
to space. Most significant, he’s been testing rockets that can push their payload to space and then return to
Earth and land with supreme accuracy on a pad floating at sea or even their original launchpad. Instead of
having its rockets break apart after crashing into the sea, SpaceX will use reverse thrusters to lower them
down softly and reuse them. Within the next few years, SpaceX expects to cut its price to at least one-tenth

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that of its rivals. Reusing its rockets will drive the bulk of this reduction and SpaceX’s competitive
advantage. Imagine one airline that flies the same plane over and over again, competing against others that
dispose of their planes after every flight.
*
Through its cost advantages, SpaceX hopes to take over the
majority of the world’s commercial launches, and there’s evidence that the company is on its way toward
doing just that. To date, it has flown satellites for Canadian, European, and Asian customers and
completed about two dozen launches. Its public launch manifest stretches out for a number of years, and
SpaceX has more than fifty flights planned, which are all together worth more than $5 billion. The
company remains privately owned with Musk as the largest shareholder alongside outside investors
including venture capital firms like the Founders Fund and Draper Fisher Jurvetson, giving it a
competitive ethos its rivals lack. Since getting past its near-death experience in 2008, SpaceX has been
profitable and is estimated to be worth $12 billion.
Zip2, PayPal, Tesla, SolarCity—they are all expressions of Musk. SpaceX is Musk. Its foibles
emanate directly from him, as do its successes. Part of this comes from Musk’s maniacal attention to
detail and involvement in every SpaceX endeavor. He’s hands-on to a degree that would make Hugh
Hefner feel inadequate. Part of it stems from SpaceX being the apotheosis of the Cult of Musk. Employees
fear Musk. They adore Musk. The give up their lives for Musk, and they usually do all of this
simultaneously.
Musk’s demanding management style can only flourish because of the otherworldly—in a literal sense
—aspirations of the company. While the rest of the aerospace industry has been content to keep sending
what look like relics from the 1960s into space, SpaceX has made a point of doing just the opposite. Its
reusable rockets and reusable spaceships look like true twenty-first-century machines. The modernization
of the equipment is not just for show. It reflects SpaceX’s constant push to advance its technology and
change the economics of the industry. Musk does not simply want to lower the cost of deploying satellites
and resupplying the space station. He wants to lower the cost of launches to the point that it becomes
economical and practical to fly thousands upon thousands of supply trips to Mars and start a colony. Musk
wants to conquer the solar system, and, as it stands, there’s just one company where you can work if that
sort of quest gets you out of bed in the morning.
It seems unfathomable, but the rest of the space industry has made space boring. The Russians, who
dominate much of the business of sending things and people to space, do so with decades-old equipment.
The cramped Soyuz capsule that takes people to the space station has mechanical knobs and computer
screens that appear unchanged from its inaugural 1966 flight. Countries new to the space race have
mimicked the antiquated Russian and American equipment with maddening accuracy. When young people
get into the aerospace industry, they’re forced to either laugh or cry at the state of the machines. Nothing
sucks the fun out of working on a spaceship like controlling it with mechanisms last seen in a 1960s
laundromat. And the actual work environment is as outmoded as the machines. Hotshot college graduates
have historically been forced to pick between a variety of slow-moving military contractors and
interesting but ineffectual start-ups.
Musk has managed to take these negatives surrounding the aerospace business and turn them into gains
for SpaceX. He’s presented the company as anything but another aerospace contractor. SpaceX is the hip,
forward-thinking place that’s brought the perks of Silicon Valley—namely frozen yogurt, stock options,
speedy decision making, and a flat corporate structure—to a staid industry. People who know Musk well
tend to describe him more as a general than a CEO, and this is apt. He’s built an engineering army by
having the pick of just about anyone in the business that SpaceX wants.
The SpaceX hiring model places some emphasis on getting top marks at top schools. But most of the
attention goes toward spotting engineers who have exhibited type A personality traits over the course of

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their lives. The company’s recruiters look for people who might excel at robot-building competitions or
who are car-racing hobbyists who have built unusual vehicles. The object is to find individuals who ooze
passion, can work well as part of a team, and have real-world experience bending metal. “Even if you’re
someone who writes code for your job, you need to understand how mechanical things work,” said Dolly
Singh, who spent five years as the head of talent acquisition at SpaceX. “We were looking for people that
had been building things since they were little.”
Sometimes these people walked through the front door. Other times, Singh relied on a handful of
enterprising techniques to find them. She became famous for trawling through academic papers to find
engineers with very specific skills, cold-calling researchers at labs and plucking possessed engineers out
of college. At trade shows and conferences, SpaceX recruiters wooed interesting candidates they had
spotted with a cloak-and-dagger shtick. They would hand out blank envelopes that contained invitations to
meet at a specific time and place, usually a bar or restaurant near the event, for an initial interview. The
candidates that showed up would discover they were among only a handful of people who been anointed
out of all the conference attendees. They were immediately made to feel special and inspired.
Like many tech companies, SpaceX subjects potential hires to a gauntlet of interviews and tests. Some
of the interviews are easygoing chats in which both parties get to feel each other out; others are filled with
quizzes that can be quite hard. Engineers tend to face the most rigorous interrogations, although business
types and salesmen are made to suffer, too. Coders who expect to pass through standard challenges have
rude awakenings. Companies will typically challenge software developers on the spot by asking them to
solve problems that require a couple of dozen lines of code. The standard SpaceX problem requires five
hundred or more lines of code. All potential employees who make their way to the end of the interview
process then handle one more task. They’re asked to write an essay for Musk about why they want to
work at SpaceX.
The reward for solving the puzzles, acting clever in interviews, and penning up a good essay is a
meeting with Musk. He interviewed almost every one of SpaceX’s first one thousand hires, including the
janitors and technicians, and has continued to interview the engineers as the company’s workforce
swelled. Each employee receives a warning before going to meet with Musk. The interview, he or she is
told, could last anywhere from thirty seconds to fifteen minutes.