Elon Musk’s fortune is growing a little more every day. Even seen from low orbit of one of the ISS modules, now also supplied by SpaceX’s Crew Dragon capsules, it remains impressive. So, it’s human, we all wonder how he managed to build his fortune and how much it extends…
Answers in this article!
An early entry into the world of entrepreneurship
Elon Musk is an American entrepreneur who showed predispositions to business from a young age. At age 12, for example, he develops and sells a video game program for around $500. When he was 18, he left Pretoria, his birthplace, to settle in Canada.
Then, instead of finishing his studies, he decided to create his own company. He gives it the name of Zip2, and co-founds it with his brother. It specializes in the production of software for publishing online content.
Business for Elon Musk began in 1999 with the sale of its Zip2 business to Compaq for $341 million. The entrepreneur invested the sum he obtained from this sale. He created X.com, an online bank that would be known around the world as PayPal. In 2002, the online banking service is bought by eBay for the sum of 1.5 billion dollars.
Thanks to his 11.7% share in the company, Elon Musk obtains $ 180 million from this takeover. The same year, he created the company Space Exploration Technologies or SpaceX.
The “stock options” at the origin of Elon Musk’s fortune
Tesla stock has been rising steadily for several years. At the start of 2020, it took +269%. Elon Musk’s shares in the Tesla company earn him a fairly substantial sum of money each year. But, above all, there are the options of “stock options” that were imposed on him in 2018.
The Tesla team has indeed decided that their CEO will be rewarded based on business performance. He will therefore not receive a salary for 10 years. The salary in question is estimated at $56,000.
The CEO will be able to unlock “stock options” each time objectives are achieved. This was the case around the middle of 2020 and the businessman was thus able earning his first salary of $700 million.
On Tuesday, July 21, 2020, Tesla stock again reached a significant threshold, a target set within the team. Also, the CEO was able to unlock other “stock options” which could bring him 2.1 billion dollars.
But he will not be able to immediately acquire and sell them. It will only be allowed there in 2025.
First stepping stone: the rise of crypto-currencies
The first of the investments to have made his fortune, without much surprise, it is dogecoin. The one who is nicknamed on social networks the “dogefather”for its great influence on the course of this cryptocurrency has an astronomical amount.
According to many, he was the man behind the rise of this crypto, allowing it to peak at $0.75 earlier this year. But as it took dogecoin to new heights, it also caused dogecoin to fall.
Since the release of a humorous video where Musk mocks dogecoin, and the general decline in the cryptocurrency market caused by Chinese state policies, dogecoin has collapsed. It is hovering around €0.20 at the time of writing these lines (November 2021).
Speaking of cryptocurrencies, we should not forget to mention ethereum and bitcoin, two cryptocurrencies well known to the general public which are today the two largest virtual currencies on the market.
If Elon Musk, through his tweets, does not hide his love for dogecoin, the latter nevertheless specified that he possessed, by far, many more bitcoinsthan all other cryptocurrencies:
“The bitcoin I own is worth much more than ethereum or doge”
explains the entrepreneur from Pretoria.
Investments in growth sectors
Like the rockets of his company SpaceX, Elon Musk’s fortune soars to the stars. The whimsical Tesla founder’s wealth has soared by more than $50 billion this year, more than any other billionaire, according to Bloomberg.
While he derives nearly three-quarters of his fortune from his 20% stake in Tesla, the rest comes from SpaceX. The company has been valued at $100 billion, making it the second largest unicorn in the world.
Thanks to his participation of about 50%, Elon Musk was enriched by 10 billion. A figure that could change very soon, SpaceX being in an extremely rapid development phase. If Jeff Bezos and Elon Musk are engaged in a fierce battle for the commercial conquest of space, it is the latter has taken a step ahead.
SpaceX has already flown astronauts to the International Space Station under a contract with NASA. For its part, Blue Origins, the company of Jeff Bezos, made its first manned flight this summer only. A delay that is reflected in valuations: Blue Origins is worth less than a tenth of SpaceX, according to Bloomberg.
Finally, Musk owns two companies, which are still in the development stage. “gestation” in his own words:
- Boring Company.
They are focused on medical research for the first and a completely different field for the other: the construction, more specifically of tunnels. The two companies are currently not making any profit, but this situation could change very soon.
Tesla’s IPO propels Musk to new heights
In 2004, he co-founded Telsa, the premium electric car maker. In 2010 Telsa went public. And NASA has signed an ISS (International Space Station) resupply contract with SpaceX.
From 2012, the businessman made his appearance on the list of the “richest people” of the American magazine Forbes. Selection criterion: a fortune estimated at around 2 billion dollars. A fortune that continues to soar to reach 20.4 billion dollars in 2017.
And this fortune continues to break records! On November 4, Elon Musk is at the head of a fortune of 336 billion dollars according to Bloomberg. His personal fortune jumped $36.2 billion. This represents approximately 31.2 billion euros, in one day, Monday, October 25.
The cause: an order by the rental company Hertz for 100,000 cars caused Tesla shares to soar. In addition, his electric car company announced a record number of vehicle deliveries in the first quarter of 2021. Something to panic Wall Street.
He was the richest man in the world
Most of Elon Musk’s fortune comes from his 21% stake in Tesla. He owns about 147 million shares and has more than 56 million vested stock options. As Tesla passed through various milestones throughout 2020, Elon Musk received multiple option tranches. Their value was several billion dollars each, according to regulatory documents.
During January 2021, as his net worth continued to skyrocket, Elon Musk briefly overtook Jeff Bezos as the richest person in the world. Elon Musk’s net worth, however, peaked at around $190 billion. Jeff Bezos has since regained the title of the richest person in the world.
Earnings estimated at $126 billion over one year
Elon Musk has been the biggest dollar fortune makeraccording to data compiled by Sergei Klebn of Forbeswho also noted that his net worth skyrocketed 500%.
This is explained by the surge in Tesla shares. The electric car company founded by Musk grew by 300% between last year and the year before.
Thus, Tesla has a market capitalization of over 650 million by the end of 2020. This makes the company the most valuable automaker in the world. Although other companies are betting on electrical systems, Elon Musk was among the first to focus on developing autonomous technologies. He perfected them and integrated them into his cars, in addition to being in a constant process of improving the electrical systems.
So we’re talking about Musk’s fortune, much of which is generated by the roughly 21% of Tesla stock he owns. This growth is directly linked to the results obtained by the car manufacturer in recent years.. This is despite the difficulties he has faced due to the pandemic and other government limitations.
In fact, she managed to exceed expectations during this period. According to Forbes, Elon Musk is also considered one of the highest paid CEOs in the world. Thus, he received up to 11 million euros in shares.
An unfailing determination to carry out its projects
In addition, Elon Musk recently managed to raise $850 million in a fundraiser for SpaceX, his space exploration company. This allowed him to increase the value of the company by $74 billion, compared to $46 billion the previous year. Musk shares held here have reached a value of $2 billion.
As mentioned, it should be noted that SpaceX’s value could rise further. The reason ? The Starlink project, which aims to offer high-speed internet worldwide, will be activated globally. It will arrive in Mexico in the coming months. And despite its high cost, the quality of the connection could attract millions of customers worldwide.
Also, some of SpaceX’s biggest launches are coming up. This could entice more investors to join the billionaire’s vision.
On the other hand, Musk has multiple transportation development projects in mind; Tesla has collaborated with other producers to create different technologies. This year, the automaker hasn’t seen a rise in its stock like last year.
But it still has many investors who support Elon Musk’s vision. And they are all convinced that he will generate multiple benefits, once he has reached the future he wishes to reach.
Despite the criticism and his unorthodox way of showing himself to the world, Musk is moving forward with his plans and as long as he continues to be successful, that portfolio will grow.
Find more information on the ecosystem built by Elon Musk in the files that the editorial staff of Tesla Mag devotes to electromobility and its challenges.