The richest man in the world

It’s no secret the entrepreneur and engineer, Elon Musk, is a cultural icon. As CEO of SpaceX and Tesla, founder of The Boring Company and co-founder of a handful of other companies, Musk now has yet another title to his name: the richest man in the world. 

Overtaking Amazon giant Jeff Bezos, he acquired the status in early 2021, reaching an estimated net worth of over $185 billion. Such an achievement is a huge accomplishment, but what is more impressive is the way Musk built that fortune. Many are quick to criticize people who have achieved billionaire status, suggesting no one should have the opportunity to accumulate such capital while others live below the poverty line. What is overlooked in those discussions is, if his company is worth 1 trillion dollars, and he is worth $185 billion counting all his portfolio, that actively means he has created an equivalent of $815 billion (about $2,500 per person in the US) in wealth for other individuals.

While a popular narrative might be that Musk has achieved success by exploiting others, there seems to be a profound disconnect between this theory and reality. 

Alongside his wealth, Musk has created countless jobs, contributed millions of dollars to charities and led technological and engineering feats that once seemed impossible. Thus, he has promoted crucial breakthroughs, paving the way for progress, both inside and outside his own companies. So rather than condemn Musk, we should examine his path to prosperity. 

Tesla has indeed received government subsidies; however, there are lessons to be learned here, and chief among those lessons is that of the power to take risks. If the government is to engage with private industry in any way, it should be by offering incentives for innovation rather than by punishing or over-regulating promising entrepreneurs.

In 2004, when electric vehicles (EVs) were considered a niche market, Elon Musk joined the Board of Directors of Tesla, the famous electric car company. From then on, with its unconventional marketing strategy and appeal to luxury, Tesla contributed significantly to the popularization of electric vehicles in the 21st century. Since Tesla was founded, the production of EVs, as well as the infrastructure for these vehicles, has grown astronomically. Since 2003, the US surpassed one million EV sales, and the infrastructure has only continued expanding. In this way, Tesla paved the way for other EV manufacturers to debut in the modern market. Soon, the industry’s growth exceeded initial expectations and thereby accelerated the path to a cleaner future.

Musk, of course, had no way of knowing this 17 years ago when he took a chance and founded Tesla. Entrepreneurs usually precede market trends with their products, which is the beauty of a free market. Because of Tesla and similar EV companies, consumers have received a new and more sustainable choice. Historically, innovation was driven by people like Musk, not government actors. Innovators are usually criticized for their success, despite leading the initiatives that some usually urge governments to take on. The main difference is that entrepreneurs take risks with their own resources and reap their own consequences. In contrast, governments act at the expense of taxpayers and often at the expense of personal freedoms.

What is most critical about Musk’s trajectory is that he was not reacting to the government requiring a certain number of electric vehicles by a certain year or, as California enacted late last year, complete elimination of traditional gasoline-powered cars by 2035. Musk created Tesla because he had an idea that he believed would be beneficial and attractive to consumers. In the early years, the delays and difficulties of innovation almost bankrupted him. However, he succeeded in building it, and to his delight, the market responded with enthusiasm, and Tesla became famous in less than two decades. 

Elon Musk is a pioneer who took risks that others were unwilling to take, creating jobs, improving society and leading vital technological developments and research in the process. In practice, his success is due to an approach that can never be replicated in series, an approach to creation based on ambition, curiosity and responses to market demands, rather than a mandate or policy.