Long Bottom Line Pioneer: Elon Musk

Elon Musk has been a hero of mine for several years, and his recent TED talk in February reminded me why. For the uninitiated, Musk is the creator of PayPal – the first business to make a real splash in online payments. After PayPal, Musk went on to found Tesla Motors, a leading North American electric vehicle (EV) manufacturer; Solar City, an innovative distributed solar utility in California striving to bring solar power to American households; and SpaceX, a company that designs, builds and launches space rockets using advanced technologies.

Tesla Model S

Tesla Model S

In this profound TED talk, Musk describes his personal and business missions with Tesla, Solar City and SpaceX. Some of the highlights from a Long Bottom Line perspective are as follows:

  • EVs are a substantially more carbon efficient transportation method than combustion engine vehicles, even if the electricity grid utilities the EVs plug into are powered by fossil fuels. He hopes to have a mass market EV model produced in several years.
  • Musk has placed a personal bet that solar power will be the most widely-used form of energy within two decades.
  • An appropriate financing model (the Solar City approach) can lower household energy costs without requiring the homeowner to purchase solar panels – these become capital assets of the company, funded through bank debt financing.
  • Space exploration as it is currently practiced is a very wasteful practice – the cost for each rocket launched into space can exceed one billion dollars, and these rockets are completely expendable (i.e., they are only used once). Musk’s goal is to create a reusable rocket that re-enters earth’s atmosphere and lands in one piece – allowing it to cost almost 100 times less than typical launches.

This is a fascinating talk, please enjoy.

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