Elon Musk Went Broke to Save Tesla in 2008, He's Now Worth $21 Billion
| Source: AP Photo/Jae C. Hong
Elon Musk reminded everyone on Twitter last night that he risked his entire fortune to make Tesla the success it is today. From living on borrowed money in 2008, Musk is now worth $21 billion and presides over two of the largest cutting-edge companies on the planet: Tesla and SpaceX.
Replying to one Twitter user, the 47-year-old entrepreneur confirmed:
From Broke to Billionaire
Elon Musk made a life-changing $180 million when he sold his share in PayPal to eBay. But rather than living a life of luxury, Musk poured his $180 million payout into his three new companies: Tesla, SpaceX, and SolarCity.
Despite the $180 million payday, Musk completely ran out of money to live. In 2008, he found himself in divorce proceedings and living off loans from friends. Despite being a newly minted millionaire, all his money was tied up in Tesla and SpaceX.
"The worst year of my life"
Speaking in a candid interview, Musk said that 2008 was the worst in his life.
"I remember waking up the Sunday before Christmas in 2008 and thinking to myself, 'man, I never thought I was someone who could ever be capable of a nervous breakdown.' I felt this is the closest I've ever come. Because it seemed pretty, pretty dark."
Musk's own brother confirmed his dire financial situation:
"Oh yeah. [He's] in debt. More than broke."
At the time, SpaceX was in dire straights after three failed launches. Tesla was also "haemorrhaging money" trying to get the Tesla Roadster to market.
In Musk's own divorce filing, he acknowledged: "About four months ago, I ran out of cash."
Elon Musk: Saved By NASA
Musk's worst year ever was saved in the final stretches by NASA. The space agency offered Musk a $1.5 billion contract two days before Christmas.
On Christmas Eve, Tesla investors also agreed to throw more money at the project. The lifeline for both projects helped push Elon Musk towards billionaire status.
Two years later, Tesla debuted on the stock market and the rest is history.
Musk Takes No Salary From Tesla
Despite his $21 billion net worth, Musk doesn't pick up a pay-check from Tesla. He famously agreed to a deal with the Tesla board whereby he receives stock options if he hits agreed targets.
If Tesla reaches Musk's promised $100 billion market capitalization, the bonus package could make Musk the richest person on the planet. However, Tesla stock remains volatile and Musk lost $1 billion in a day this month after an ongoing spat with the SEC killed Tesla's share price.
Tesla and SpaceX Comeback
Despite almost going bankrupt, SpaceX is still going, successfully launching the world's most powerful rocket earlier this month. Meanwhile, Tesla is on track to make 400,000 cars this year with full self-driving capability just around the corner.
Elon MuskTesla
Ben Brown
Ben is a journalist with a decade of experience covering financial markets. Based in London, UK, his writing has appeared in The Huffington Post and he was Chief Editor at Block Explorer, the world's longest-running source of Blockchain data. Reach him at Twitter at _Ben_Brown. Email ben @ benjamin-brown.uk.
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