What is Elon Musk’s net worth? How did the owner of Twitter, Tesla and SpaceX get so rich?
The woes of the stock markets have dented the vast wealth of Elon Musk, but he still tops the lists of wealthiest individuals.
Billionaires, after seeing their fortunes skyrocket during the pandemic, have been seeing their net worth taking a beating. Tech stocks in particular have been plummeting and the industry leaders that top the Forbes 400 list have collectively lost $315 billion.
However, they aren’t hurting. Many of them are still much richer than they were prior to the pandemic. Elon Musk incredibly more so with his wealth going from just shy of $20 billion in 2019 to a lofty $251 billion in 2022. And the 51-year-old from Pretoria in South Africa has added Twitter to his portfolio, as announced on Thursday.
Elon Musk rocketed to billionaire status, after entering the elite club in 2012 just nine years later he tops the list. His wealth is based mainly on his shareholdings in the electric car firm Tesla, of which he is the CEO.
Musk has dabbled in many projects during his career to date, from online payment systems, artificial intelligence and transportation above and below ground and into outer space. His musing can send the value of his and other companies, as well as cryptocurrencies, soaring or plummeting.
He has recently decided to step down as CEO of Twitter and has named Linda Yaccarino to replace him.
From South Africa to California
Elon Reeve Musk was born in Pretoria, South Africa where he grew up and would briefly attend university. He was born into a family of considerable wealth and had a knack for technology and entrepreneurship at a young age. He wrote and sold the code for a video game when he just 12 years old. But his dreams lay on the other side of the world in America.
Since his mother was born in Canada, he was able to get a Canadian passport to establish himself there at 17. He did this in the knowledge that it would be easier to enter the United States from Canada, he became a US citizen in 2002.
After studying at Queens College in Ontario for two years he made his move to the United States and first graduated from the University of Pennsylvania with a degree in economics and later a degree in physics. In 1995, he headed for the west coast to study a PhD in energy physics at Stanford University, however he dropped out after two days.
It was the heyday of the internet boom and Musk saw more opportunity in the internet than physics. He started his first company that same year.
Elon Musk’s entrepreneurial rise to extreme wealth
Along with his brother Kimbal, Musk founded the web software company Zip2, which they sold four years later to Compaq for $307 million. Next, he co-founded online bank X.com, which became PayPal after merging with Confinity in 2000. eBay acquired PayPal for $1.5 billion in 2002, the same year Musk became a US citizen and that he founded his next creation.
SpaceX is born
Elon Musk has long felt that in order for the human species to survive, humanity would need to become a multi-planet species. This led to the founding of his third company SpaceX in 2002. Musk wanted to build spacecraft for commercial space travel that would be reusable and thus cheaper to operate. Within six years the company had secured a contract with NASA to handle cargo transport for the International Space Station (ISS).
The target had always been to carry humans into space and in 2020 the company launched its first manned flight. This allowed NASA to send astronauts to the ISS on flights launched from US territory and cease to rely on Russia for a ride. The Company is now working on its next project its Starship which it hopes to use to colonize Mars.
Not one to sit on his laurels, even though SpaceX was just in its infancy, in 2004 Musk invested in Tesla Motors becoming its the largest shareholder and chairman of the board of directors, picking up the title of co-founder along the way. The company’s creators set out to produce affordable electric cars to be mass marketed. The company also makes the lithium-ion batteries for their cars as well as for homes to store energy and solar powers to charge them.
Although many in the automotive industry doubted the endeavor, by 2008 Tesla rolled out its first model, the Roadster sports car. Four years later Tesla began manufacturing its Model S sedan. After some delays, production got fully underway on the Model 3, the most reasonably priced of the four models Tesla currently sells. As of June 2021 the company had sold over one million units of the Model 3.
In 2017, Tesla overtook General Motors to become the most valuable US carmaker. The company’s cars kick started an electric vehicle revolution making them appealing to the masses. The growth of that market and the price of Tesla’s stock is the driving force behind his outsized wealth.
So just how much is Elon Musk worth?
Elon Musk first made the Forbes Billionaires List in 2012 when his net worth was listed at $2 billion. At the start of 2020, Musk had a net worth of $27 billion, but since then it has skyrocketed. By July the same year he surpassed Warren Buffett reaching a net worth in the vicinity of $70.5 billion, according to Bloomberg.
A little over a year later Musk overtook Jeff Bezos as the richest person in the world when he crossed the $200 billion marker. And just a matter of months later in November 2021 he became the first person to have a net worth over $300 billion. He briefly dropped below that threshold only to return again above $300 billion at the end of the month.
Tesla, like other tech companies, has taken a hammering since the beginning of the year. While the share price of Tesla is down over 35 percent from its peak in November last year, it is still slightly above where it was year-on-year. Musk derives much of his wealth from his stock holdings in the electric carmaker which he receives as compensation instead of a salary.
That has given him the benefit of not paying income taxes which he has been highly criticized for. However, now he will face a hefty tax bill as he cashed in his options and sold off some of his normal shares in the company. Reuters calculates that Musk has sold off around $32 billion worth of the company’s stock in less than a year taking his share of the company from 20 percent down to 15 percent.