With a net worth estimated at around $150 billion as of May 2021, Elon Musk is one of the world’s richest and most influential people. The business magnate is not only a citizen of the United States of America but also of Canada, and South Africa where he was born. It is widely believed that he is a self-made billionaire but it has been upheld in some quarters that he set out as an entrepreneur with some money he got from his father. But Elon, who has described his father Errol Graham Musk as an evil person several times, has insisted he worked his way through college and even accumulated a $100,000 debt in the process. While his status as a self-made billionaire is still up for debate for many people, no one can deny he is currently one of the richest billionaires in the world.
Elon was worth about $27 billion in early 2020. His wealth on paper skyrocketed that year by as much as $150 billion, thanks to the Tesla stock he owns. Throughout the year, his net worth has randomly soared and dropped. At some point, it plunged to $16.3 billion but he later surpassed Mark Zuckerberg of Facebook to become the third-richest billionaire in the world. A few days later, he also surpassed Bill Gates to take the second spot on the billionaire list. Then came January 2021 when the SpaceX founder overtook Jeff Bezos of Amazon to become the richest person in the world. Since then, people have been super curious about how Elon makes his money even though Bezos has reclaimed the top spot.
Founding Zip2 Made Elon Musk a Multimillionaire in 1999
When @elonmusk started his first company Zip2 in 95, his main intention wasn't the money, he wanted to get involved with the Internet as there were almost no businesses on the Internet at that time. It's really important that you create product/service that's helpful to others pic.twitter.com/V6ucTgCfec
— Pranay Pathole (@PPathole) May 27, 2021
While everyone would love to be as rich as the centibillionaire, not many can put up the kind of commitment the entrepreneur has put into his multiple endeavors. And neither can many endure the rough and troubled hardship he faced in the early years of his life. Born in Pretoria, South Africa to a South African father and a Canadian mother, Elon Musk’s parents parted ways when he was about nine years old. The young man opted to live with his father in South Africa instead of following his mother. This decision soon proved to be a wrong one as he began to encounter a series of traumatic experiences. According to Elon, who has had zero nice things to say about his father, Errol Musk exceedingly abused him. The older Musk reportedly seized every opportunity he gets to curse his son, often asserting that Elon wouldn’t amount to any use in life. Elon initially thought his father was only a lonely and sad man but he soon realized that Errol was beyond redemption and started seeking ways to leave him.
Apart from the abuse he suffered at the hands of his father, Elon was also bullied a great deal all through his childhood as he was a “weirdo”. Determined to leave South Africa for the United States, Musk knew it would be easier for him if he was in Canada, so he utilized his mother’s identity to get himself a Canadian passport. Before this, he had enrolled at the University of Pretoria in South Africa. When his Canadian passport came through, he abandoned his studies at the university and relocated to North America. Moving to Canada, however, didn’t make things any easier for him. He moved from home to home and did multiple odd jobs to survive.
It was sometime in June 1989 that he moved to Canada. By 1990, he had become a student of Queen’s University in Kingston, Ontario. Roughly two years later, his dream to get into the United States came to fruition as he secured a transfer from Queen’s University to the University of Pennsylvania. There, he secured a Bachelor of Arts degree in physics and a Bachelor of Science degree in economics, which he obtained from the Wharton School. Thereafter, Musk interned with Rocket Science and Silicon Valley before he decided to further his studies, in 1995. At Stanford University in California, he enrolled for a PhD program in energy physics and material science. But just two days later, he dropped out to focus on creating a company that revolves around the internet. This was how Zip2 was birthed.
Elon launched Zip2, an internet software company with his brother Kimbal Musk and Greg Kouri in 1995, with funds they generated from private investors. Elon coded the website to develop an internet city guide for the news publishing industry. At this stage, Elon couldn’t even rent an apartment, so he worked and lived in the office space they rented which housed only one computer. Roughly four years after Zip2 was founded, precisely in February 1999, Compaq acquired it for $307 million. It is said that Elon owned a seven percent share of the company which amounted to $22 million.
He Made $180 Million When eBay Acquired PayPal in 2002
The same year Zip2 was acquired by Compaq, Elon Musk co-founded another internet startup that made him richer by over $100 million. Together with Ed Ho, Harris Fricker, and Christopher Payne, Elon co-founded X.com in March 1999. It didn’t take much time before the startup gained a stronghold of the market. To avoid competition and consolidate on its popularity, the online financial service company merged with Confinity, the software company that created PayPal; this was in 2000.
Elon, who had been replaced as the CEO of X.com, returned after the merger but then he had a series of disagreements with Peter Thiel, the co-founder of PayPal, which forced Thiel to resign. The board of the company soon saw the need to kick Elon out and replace him with Peter Thiel. By 2001, the company adopted PayPal as its name, and the following year, the multinational e-commerce corporation, eBay, acquired it for a massive $1.5 billion.
Elon Musk was the largest shareholder of the company. Reports have it that he was holding 11.7 percent of PayPal shares which amounted to $180 million.
Thanks PayPal for allowing me to buy back https://t.co/bOUOejO16Y! No plans right now, but it has great sentimental value to me.
— Elon Musk (@elonmusk) July 11, 2017
Elon Reinvested All His Proceeds From The PayPal Acquisition and It Made Him a Multi-Billionaire
Elon Musk is a relentless entrepreneur and it is the ultimate secret to his wealth. One of his most popular quotes that capture his attitude towards investment disclosed that he had to borrow money to pay his rent after eBay acquired PayPal. The billionaire said he reinvested all of the money he got from the acquisition: $100 million in SpaceX, $70 million in Tesla, and $10 million in SolarCity.
Technically, I "got rich" from Zip2 & PayPal w zero govt anything, then put 100% of that into SpaceX, Tesla & SolarCity.
— Elon Musk (@elonmusk) May 25, 2013
He Is The Founder of SpaceX Currently Valued at $74 Billion and Holds 54% of Its Equity
SpaceX took the bulk of money Elon Musk got from PayPal. It was in 2002 that the billionaire founded the aerospace manufacturer and space transportation company. He has been outspoken about the prime purpose of the company headquartered in Hawthorne, California – to reduce the cost of space transportation and thereby facilitate the colonization of Mars.
The privately held company has been operating for almost two decades and has recorded astounding levels of achievements over the years. It now has about 9,500 people employed and makes as much as $1.6 billion in revenue. The company gained a lot of media attention in May 2020 when it made history as the first private company to take astronauts into space. This is one of the many factors that has been pushing its revenue upwards. SpaceX is currently valued at $74 billion and Elon Musk holds 54% of its equity.
He is the founder, chairman, CEO, and chief technology officer of the company. Given that, no one needs to be told he takes the lion’s share of whatever profit the company makes.
— SpaceX (@SpaceX) May 26, 2021
Elon Musk Owns 193.3 Million Tesla Shares Valued at Over $600 Each
Tesla was originally founded as Tesla Motors in July 2003 by Martin Eberhard and Marc Tarpenning. Their goal was not only to have a unique car manufacturing company but to also be known as a technology company. While Martin served as the CEO of the company, Marc served as its chief financial officer and they were soon joined by Ian Wright. Elon Musk joined the company as an investor who contributed the most money in the company’s first round of venture capital financing.
With that, he became chairman of the company’s board of directors. In September 2009, Martin dragged Tesla to court. This was after he was ousted as the CEO with Elon taking his place. Martin alleged that Elon was trying to rewrite the history of the company to his favor. In the end, it was agreed that there are five founders of the company; Martin Eberhard, Marc Tarpenning, Elon Musk, Ian Wright, and JB Straubel.
While there are multiple founders of the company, Elon has become the face of the luxury electric vehicle maker. He is the CEO and Product Architect of Tesla and takes the largest cut of the company’s profit as he is also the largest shareholder of Tesla. He holds 20.7% of Tesla shares which amounts to 193.3 million shares. This is thrice the amount of Tesla shares held by other institutional shareholders. Given that a unit of Tesla’s share is worth over $600 as of May 2021, it is not difficult to see that Tesla is the company driving Elon Musk’s net worth upwards.
Tesla Energy (SolarCity) Recorded a Revenue of $1.99 Billion In 2020
As stated earlier, Elon Musk invested $10 million in SolarCity after eBay acquired PayPal. Founded in July 2006 by Peter and Lyndon Rive, who are cousins of Elon, SolarCity operated as a publicly-traded company and majorly sold solar energy generation systems. The company enjoyed rapid growth and was soon regarded as the top residential solar installer in the whole of the United States.
But then, SolarCity soon ran into challenges that saw it cut its workforce by 20% in 2016. It was in the same year that Tesla acquired SolarCity for $2.6 billion and it became Tesla Energy. Much like SolarCity, Tesla Energy sells solar energy generation systems and related products but with a different business model to deal with the over $1.5 billion SolarCity had in debt.
Right from the moment SolarCity became Tesla Energy, it has faced several challenges, controversies, and lawsuits. For instance, multiple Tesla shareholders sued Elon Musk and Tesla’s directors, alleging that they were not informed of SolarCity’s liquidity issues; that Tesla’s acquisition of SolarCity was carried out only for the benefit of Elon and to the disadvantage of other Tesla shareholders. Despite all the negative reports, Tesla Energy seems to be thriving. Reports have it that it generated $1.99 billion in revenue in 2020.
Other Companies That Have Contributed To Elon Musk’s Net Worth – How Much Does He Have Now?
Unless you have been living in a cave, you should know that Elon Musk is a multi-billionaire. To the best of our knowledge, he became a billionaire sometime in the early 2010s. It was in 2012 that he was first listed on Forbes’ billionaire list. Then, his net worth was estimated at only $2 billion.
His net worth has been rising and dropping in recent times, driven by the fluctuations in Tesla’s share price, but has been majorly been around $150 billion. His wealth peaked at $185 billion in January 2021 when he surpassed Jeff Bezos to become the richest man in the world.
Apart from Telsa, SpaceX, and Tesla Energy, the billionaire has involved himself in a series of other profitable ventures through which he makes money. They include but are not limited to The Boring Company and Neuralink.
The Boring Company
It was in December 2016 that Elon Musk founded the infrastructure and tunnel construction services company headquartered in Los Angeles, California. Formed as a subsidiary of SpaceX, The Boring Company became an independent firm sometime in 2018.
With several projects under its belt, the company is on its way to becoming a very successful establishment. The company is not publicly traded and Elon is its primary shareholder. So, much of the revenue the company has generated from its activities thus far goes to him.
Monkey plays Pong with his mind https://t.co/35NIFm4C7T
— Elon Musk (@elonmusk) April 9, 2021
Before he founded The Boring Company, Elon Musk founded Neuralink in July 2016 with eight partners. Headquartered in San Francisco, Neuralink Corporation is a privately held company that specializes in brain-computer interface neuroprosthetics.
While the company’s aim of building a brain-computer interface has received mixed reviews, it is believed that the company could pull off a significant breakthrough for the treatment of serious brain diseases. It is hard to tell if the company has been making any profit, but if it has, Elon takes most of it as it was once reported that he contributed $100 million of the $158 million funding the company had generated.