Business plan

‘I don’t really have a business plan’: How Elon Musk is doing

As Twitter negotiated a sale to Elon Musk last month, the social media company released a corporate takeover playbook.

Musk, the richest man in the world, did the opposite.

He had no plan to fund or run Twitter, Musk told a close associate. To push through the $44 billion deal, he turned to a small inner circle, including Jared Birchall, the head of his family office, and Alex Spiro, his personal attorney. And when Twitter resisted its overtures, Musk pressured the company with a series of tweets — some mischievous, some barbed, and all impulsive.

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Tech billionaires like Bill Gates, Jeff Bezos, and Larry Page often make long-term plans and manage their affairs through a corporate apparatus made up of lawyers, communications professionals, and various advisers. Musk, 50, functions like none of them.

To a degree never seen in any other tycoon, the entrepreneur acts on whim, fantasy and with the certainty that he is 100% right, according to interviews with more than 30 current and former employees, investors and others who have worked with him. While Musk has successfully bet on electric cars, space travel and artificial intelligence, he often comes out on top in the biggest moments, shuns experts and relies almost solely on his own advice, they said.

Elon Musk speaks to the media as he sits in front of the SpaceX Falcon Heavy rocket at NASA’s Kennedy Space Center in Cape Canaveral, Florida on February 5, 2018. To a degree never seen in any other tycoon, the entrepreneur acts on whim, fantasy and the certainty that he is 100% right, according to interviews with more than 30 current and former employees, investors and others who have worked with him. (Todd Anderson/The New York Times)

To operate this way, Musk has built an island world of around 10 confidants who mostly agree with him and execute his bids. They include his younger brother, Kimbal Musk; Birch; Spiro; and various Chiefs of Staff. To manage his many ideas, Musk is continually creating new ventures, most of which are structured to keep him in the driver’s seat. His trusted lieutenants often work in his vast corporate empire.

Once Musk identifies each company’s key project – what he calls its “critical path” – he takes over to ensure that his vision is followed, controlling the smallest aspects of how the technologies are built. and deployed. His genius spawned the world’s most valuable automaker and an innovative rocket company, and he earned the respect – and fear – of his engineers.

Relying on his small crew and following his own thinking allowed Musk to make the decisions and conduct himself with few constraints, turning him into a modern-day figure akin to Howard Hughes – even if his siege methods trousers often create rowdiness.

During a conference in 2018, Musk explained that he behaved impulsively. It’s a lesson he learned more than 25 years ago after founding his first startup, Zip2, he said.

“I don’t really have a business plan,” he says. “I had a business plan back in the days of Zip2. But those things are still wrong, so I just didn’t care about business plans after that.

How Musk works has implications for what he might do with Twitter. The San Francisco company, which the billionaire is expected to take ownership of in the next six months, has been in turmoil over the deal.

Kimbal Musk, the younger brother of Elon Musk, in downtown Boulder, Colorado October 9, 2017. Elon Musk built an island world of about 10 confidants, including his brother Kimbal, who are mostly d agree with him and execute his bids. (Ryan David Brown/The New York Times)

Last week, Twitter CEO Parag Agrawal told the company’s more than 7,000 employees that once Musk takes over, “we don’t know which direction this company will go.” Twitter declined to comment for this article.

Musk, who did not respond to requests for comment, is far from unaware of the chaos he is leaving behind. In emails regarding a 2018 defamation case stemming from one of his tweets, Musk called himself an idiot in vulgar terms.

Keep control

Born in Pretoria, South Africa, Musk was interested in computers and programming languages ​​from childhood. After beginning his college education in Canada, he moved to the United States in 1992, earning degrees in economics and physics from the University of Pennsylvania, then enrolling as a doctoral student in physics at Stanford University. .

Almost immediately, Musk left Stanford to pursue a career in business. His first startup, in 1995, a travel guide service called Zip2, was a family affair with his brother, Kimbal. Computer maker Compaq then bought Zip2 for over $300 million.

In 1999, Musk helped found X.com, an online payment company that eventually became known as PayPal. There he began making corporate statements publicly, even though his employees were unprepared for them.

During a live television appearance that year, Musk said the company would guarantee transactions on all auctions on eBay, the e-commerce site. It was the first time his engineers had heard of the feature, said a person who worked with him at the time. They had to race to make the feature a reality, the person said.

In 2000, the X.com board and executive Peter Thiel ousted Musk over disagreements over the direction of the company. It was a painful exit for Musk, who quickly embraced the idea that he — and he alone — should be in charge of future ventures.

As Musk created new ventures — he founded SpaceX in 2002 and invested in Tesla in 2004 — he made sure he could exercise his will in every venture. He poured more than $100 million of his own money into SpaceX in its early years and holds majority control. At Tesla, Musk has a 16% stake and has filled the board with friendly faces, including his brother and Antonio Gracias, a longtime friend and investor.

Kimbal Musk and Gracias, who left Tesla’s board of directors last year and are directors of SpaceX, declined to comment for this article.

A turbulent year

A defining year for Musk came in 2018 when his solo, brash style came back to bite him.

At Tesla, Musk pushed to ramp up manufacturing of the company’s Model 3 sedan. Believing that only he could do the job, he fired the executive responsible for manufacturing and decided to revamp the entire assembly line himself at the company’s factory in Fremont, California. Often he slept in a conference room at the factory.

After the Model 3 redesign, Musk decided he was tired of Tesla navigating the pressures of the public market. On August 2, 2018, he drafted an email to the company’s board with the subject line: “Tesla’s $420 Private Takeover Offer.” It contained few details on how the offer would be funded.

Musk’s inner circle was thrilled.

On Aug. 7, Musk announced the idea, tweeting, “I’m considering taking $420 Tesla private. Financing assured.

Musk’s efforts failed. The financing he had counted on to take Tesla private did not materialize. Tesla shareholders sued him for securities fraud in August 2018. A month later, the Securities and Exchange Commission charged Musk with securities fraud.

Musk settled with the SEC that year and was fined $20 million. The shareholders’ trial is ongoing.

‘Maximum Pleasure’

Throughout many ups and downs, Musk had one constant: Twitter.

He typically tweets a dozen or more times a day to his more than 90 million followers, throwing barbs at Tesla shortsellers, sharing memes and ruminating on the pandemic, politics and dogecoin. In 2020, he cut Tesla’s communications department, in part because he felt he could speak directly to fans and customers via Twitter, three former employees said.

Musk’s love for the social media company drove him to buy it.

After taking over Twitter last week and celebrating with a tweet showing heart and rocket emojis, Musk showed up in Boca Chica, Texas to discuss a new SpaceX rocket engine with a team of engineers. On Wednesday, he wrote, “Let’s make Twitter fun!”

This article originally appeared in The New York Times.


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