Elon Musk isn’t afraid to take risks. He dropped out of his Ph.D. program at Stanford to start his first company; he entered the electric vehicle space way ahead of the curve; and he plans to send humans to space on commercial flights.
Fortunately for Musk, many of his risks have paid off—for one, Tesla could be on its way to a $1 trillion valuation, according to Forbes. Here are a few of Musk’s bets that have paid off.
Bringing Electric Cars to the Mass Market
Musk said in 2006 that he wanted to expand the Tesla brand beyond high-end electric sports cars and into more affordable cars for the mass market.
During a 2018 SXSW panel, Musk talked about this decision and said that it was a huge risk since the auto market was already very crowded and several companies had already gone bankrupt trying to sell electric cars to a large number of people.
“I gave […] Tesla from the beginning a probability of less than 10% likelihood to succeed,” he said during the panel, according to CNBC.
Yahoo Finance said that if you fast-forward to 2021, Tesla will have a market cap of $636 billion. Forbes said that over the course of 2020, its value went up by a factor of eight, and its income for the year reached $31.5 billion.
Launching a Rocket Company
In 2018, Musk tweeted that “creating a rocket company has to be one of the dumbest and hardest ways to make money”—yet he did it anyway when he founded SpaceX.
As of February, SpaceX was valued at $74 billion, CNBC reported. Morgan Stanley has described the business as “mission control” for the “emerging space economy” and cited government contracts with NASA and the U.S. Department of Defense as being one of the main contributors to its high value.
Releasing the Cybertruck
When Elon Musk unveiled Tesla’s electric pickup truck in 2019, it was met with mixed reviews. Its unconventional, futuristic design was certainly a risk, and many people didn’t shy away from calling it outright ugly.
But despite its critics, sales of the Cybertruck have been strong. As of February 2020, its reservation rate was outpacing that of the Tesla Model 3, and the vehicle was averaging nearly 6,000 preorders per day, Forbes reported. The number of preorders had reached 650,000 as of July 2020, Electrek reported.
Developing brain chips
Although inserting chips into the human brain to cure diseases sounds like something out of a science fiction novel, Musk is betting that he can make this a reality.
In 2016, he started the company Neuralink with the goal of putting wireless brain-computer interfaces in people’s brains to help treat Alzheimer’s, dementia, and spinal cord injuries.
Reuters said that in August 2020, Musk showed a pig that had been implanted with the device to show that it worked normally.
While you’ll have to wait and see if Musk’s brain chips are able to cure human ailments, the company has already had some financial success with $158 million raised in funding.
Creating the Hyperloop
Musk came up with the word “hyperloop” in 2013 to describe the engineering system that would use magnetic fields to move passenger pods at high speeds through tubes.
Virgin Hyperloop is putting Musk’s idea to the test in Nevada, and both the state and federal governments have stated that they support this futuristic-looking mode of transportation.CNBC said that the U.S. Department of Transportation has recently recognized it as a way to get around.
Although we may be some years away from being able to travel this way, the company that sprouted from a Musk-written white paper is now valued in the range of $500 million to $1 billion, according to PrivCo.