‘I don’t really have a business plan’: How Elon Musk wings It6 min read
As Twitter negotiated a sale to Elon Musk last month, the social media company pulled out a corporate takeover playbook.
Musk, the world’s richest man, did the opposite.
He had no plan for how to finance or manage Twitter, Musk told a close associate. To push the $44 billion deal through, he turned to a small inner circle, including Jared Birchall, the head of his family office, and Alex Spiro, his personal lawyer. And when Twitter resisted his overtures, Musk pressured the company with a string of tweets — some mischievous, some barbed and all impulsive.
Tech billionaires like Bill Gates, Jeff Bezos and Larry Page often make long-term plans and manage their affairs through a corporate machinery of lawyers, communications professionals and different advisers. Musk, 50, operates unlike any of them.
To a degree unseen in any other mogul, the entrepreneur acts on whim, fancy 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. While Musk has successfully bet on electric cars, space travel and artificial intelligence, he often wings it in the biggest moments, eschews experts and relies almost solely on his own counsel, they said.
To operate this way, Musk has constructed an insular world of about 10 confidants who mostly agree with him and carry out his bidding. They include his younger brother, Kimbal Musk; Birchall; Spiro; and various chiefs of staff. To manage his many ideas, Musk continuously creates new companies, most of which are structured so that he remains in charge. His trusted lieutenants often work across his far-flung empire of businesses.
Once Musk has identified each company’s key project — what he calls its “critical path” — he takes over to ensure that his vision is met, controlling the smallest aspects of how the technologies are built and deployed. His brilliance has spawned the world’s most valuable automaker and an innovative rocket company, and it has earned the respect — and fear — of his engineers.
Relying on his small crew and hewing to his own thinking have enabled Musk to call the shots and conduct himself with few restraints, turning him into a Howard Hughes-like figure of the modern age — even as his seat-of-the-pants methods often create bedlam.
At a 2018 conference, Musk explained that he behaved on impulse. It was 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 said. “I had a business plan way back in the Zip2 days. But these things are always wrong, so I just didn’t bother with business plans after that.”
How Musk operates has implications for what he might do with Twitter. The San Francisco company, which the billionaire is set to take ownership of in the next six months, has been in an uproar over the deal.
Last week, Parag Agrawal, Twitter’s CEO, told the company’s more than 7,000 employees that once Musk takes over, “we don’t know what direction this company will go in.” Twitter declined to comment for this article.
Musk, who did not respond to requests for comment, is far from ignorant of the chaos that he leaves behind. In emails about a 2018 defamation case stemming from one of his tweets, Musk called himself an idiot in vulgar terms.
Born in Pretoria, South Africa, Musk became interested in computers and programming languages as a child. After starting college in Canada, he moved to the United States in 1992, graduating with degrees in economics and physics from the University of Pennsylvania and then enrolling as a doctoral student in physics at Stanford University.
Almost immediately, Musk dropped out of 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 later bought Zip2 for over $300 million.
In 1999, Musk helped found X.com, an online payments company that eventually became known as PayPal. There, he began publicly making business declarations, even if his employees weren’t prepared.
In 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 about 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, X.com’s board and the executive Peter Thiel ousted Musk over disagreements about the company’s direction. It was a painful exit for Musk, who soon embraced the idea that he — and he alone — should be in charge of future ventures.
As Musk built new businesses — he founded SpaceX in 2002 and invested in Tesla in 2004 — he ensured he could exert his will at each company. He poured more than $100 million of his own money into SpaceX in its early years and has majority control. At Tesla, Musk owns a 16 per cent stake and stocked 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 last year and serves as a SpaceX director, declined to comment for this article.
A Year of Turbulence
A defining year for Musk came in 2018 when his solo, impetuous style came back to bite him.
At Tesla, Musk pushed to ramp up manufacturing of the company’s Model 3 sedan. Believing only he could get the task done, he fired the executive in charge of manufacturing and decided to revamp the entire assembly line of the company’s factory in Fremont, California, himself. Often, he slept in a conference room at the factory.
After the Model 3 overhaul, Musk decided he was tired of Tesla’s navigating the pressures of the public market. On Aug. 2, 2018, he drafted an email to the company’s board with the subject line: “Offer to Take Tesla Private at $420.” It contained few details about how the offer would be funded.
Musk’s inner circle was elated.
On August 7, Musk announced the idea, tweeting: “Am considering taking Tesla private at $420. Funding secured.”
Musk’s effort failed. The funding he had counted on to take Tesla private didn’t 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 shareholder lawsuit is ongoing.
Throughout many ups and downs, Musk had one constant: Twitter.
He typically tweets a dozen times or more in a day to his more than 90 million followers, shooting barbs at Tesla short sellers, sharing memes and ruminating on the pandemic, politics and dogecoin. In 2020, he eliminated Tesla’s communications department, partly because he felt he could go directly to fans and customers through Twitter, three former employees said.
Musk’s love for the social media company moved him to buy it.
After winning Twitter last week and celebrating with a tweet showing heart and rocket emojis, Musk turned up in Boca Chica, Texas, to discuss a new SpaceX rocket engine with an engineering team. On Wednesday, he wrote, “Let’s make Twitter maximum fun!”
This article originally appeared in The New York Times.