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I like doing things that have the potential to change the world: Elon Musk

Vinod Mahanta, ET Bureau Jan 3, 2014, 03.28AM IST
("If you get a group of talented…)

With The Beatles' Baby you can drive my car blaring in the background, Elon Musk drives a red Tesla Model S on to the stage, where he is greeted by Michael Dell. We're at the Dell World event in Austin, Texas and the excitement is palpable. On stage, in a freewheeling chat with David Kirkpatrick, CEO of techonomy, Musk—the man behind PayPal, electric car company Tesla and private space venture SpaceX—gives a peek into how his mind works. "I like technology, I like doing things that have the potential to change the world," he says. Delving into the reason why he started Tesla, Musk says that after watching the movie Who Killed The Electric Car?, it became clear to him that if left to big companies, there won't be compelling electric cars for a long time. "The movie hammered home the message that unless some new company came along and created electric cars, it will be a long time before we will see a sustainable transport. The reason behind Tesla was that there needed to be some acceleration in electric vehicles," he says.

Musk, 41, believes that the rate at which carbon is being dumped into the atmosphere will have long-term repercussions if measures aren't taken fast enough. Leaders need to act fast. "The amount of time that it'll take to switch the global industrial base to sustainable generation and consumption of energy is going to be measured in decades. It's one of those things where you need to start early," says Musk, who is also involved with SolarCity, a solar energy company.

Despite having a larger societal mission, Musk, arguably the world's most celebrated entrepreneur is an innovation junkie who creates opportunities by pushing conventional boundaries. But what's remarkable is how he has managed to promote and run two high profile ventures like SpaceX and Tesla. "I was able to convince a lot of great people to join me. People ascribe to me things where the credit is really due to a team. If you can get a group of really talented people together and unite them around a challenge and have them work together to the best of their abilities, then a company will achieve great things," says the self-made billionaire.

Being CEO of both companies helps Musk cross-pollinate ideas from different industries. For example, the Model-S uses a lighter all-aluminum body and chassis unlike the steel one that auto makers commonly use, a practice that's common in aerospace. That gives the car better range, handling and acceleration. And SpaceX is applying the well developed manufacturing techniques of the automotive industry to rocketry. In fact, the head of production at SpaceX used to run production of the Mini for BMW.

After making a pot of money after PayPal sale to eBay, Musk bet his shirt on his new startups when no one came forward to fund the bold ventures. In 2008, Tesla was on the verge of bankruptcy with no financier ready to fund the electric car start-up at a time when GM and Chrysler were going bust. "We weren't able to raise any outside money. The only choice I had was invest all the money I had left. I borrowed money from friends for living expenses. If things didn't work out, I would have been negative," he says. With Musk putting his last dime behind his dream, other investors in the company were willing to put up the other half of the money needed to keep Tesla alive.


Later in the day, I ask Michael Dell about his choice of Musk as a keynote speaker. "He's a fun guy and a bold bold risk taker," acknowledgedes Dell. Ask Ram Charan, the celebrated CEO coach about Musk, and he says, "It's large scale entrepreneurship at its best. Create a new way of doing business." Very few entrepreneurs through the history of business have had the will and the vision to rethink an industry or a category like Musk has. Kirkpatrick asks him if a visionary like him believed that people just don't try harder and Musk's reply is: "People self limit more than they realise."

The entrepreneur who tweets frequently likes to speak his mind, sometimes with consequences. When the valuation of Tesla Motors exceeded $22 billion, Musk went ahead and called his company over valued. "I did think it got a little crazy there. It was a bit generous to have a market cap of $22 bn when we're going to have revenue of little over $2 billion this year. Despite the fact that I said that on several occasions, when the stock did eventually correct, I got a bunch of shareholder lawsuits. I think it's a big distraction actually," he laughs. The father of five boys has a net worth estimated at $6.2 bn by Forbes.

In the end, Musk answers a question about gathering real time customer information from always connected cars, a move that could potentially have privacy issues. Musk says it's done with the customer's consent and ultimately it will help create a better product.

"What really gets me excited is when people experience delight with the product. I don't think there are all that many things where you really experience delight and if you can make the product good enough that it far exceeds people's expectations, I think that's amazing," he says.