Elon Musk Blows My Mind

I don’t know Elon Musk. I wish I did. This guy knows stuff. He’s the real deal.

MuskIf there is a possible next Steve Jobs or Bill Gates, it could be him. He’s not goofing around with thin stuff that’s going to come and go. He already did consumer software engineering as his opening act as a cofounder of PayPal. With the massive payday he got from eBay for the sale of his companya company that continues to operate as such an important platform it could someday be spun off again as an independent entityhe could have taken the path of least resistance and become an elder statesman of the industry, a board member, an investor, a wise individual of counsel. Not Elon Musk. He started not one subsequent company, but twoTesla Motors and SpaceXand leads both as CEO. He is also the CTO of SpaceX and the chief product architect of Tesla. Not exactly a path to retirement. He’s really, really changing the world.

I don’t know if he’s a nice guy. Like I said, I have never met him. But he is truly impressive and worth studying. Here are some perhaps not so obvious reasons why:

A real track record of repeat innovation.

A lot of people talk about being serial entrepreneurs. Elon Musk has pioneered three immensely important companies. The ability for an innovator to find repeat success in entirely new ventures is perhaps the rarest of proven attributes. Edison did it. So did Walt Disney and Steve Jobs. Musk made a mark in digital payment systems, then battery-powered automobiles and low-cost rocket propulsion. He didn’t start life as a rocket scientist, but he challenged himself to become one. Try to find a resume like his anywhere. I don’t think you can. He not only articulates a clear, bold vision, he leads from the front lines as a player-coach. He is simultaneously a thinker, a doer, and a peer-respected personal risk-taker with real skin in the game. He makes disruption make sense. That’s how you fire up a team and get results.

The work he does is important.

It was not clear to everyone in the first dot-com bubble that digital payments would be essential to our economy. Heck, most of us were lucky if we had a phone that could do email back then. PayPal opened our eyes. People have been betting against alternatives to fossil-fuel powered automobiles since the first suggestion of battery power on our roads. No matter how many failures it takes, we know that we can’t rely on the limited resource of petroleum forever. Space travel has been massively expensive, the province of federal bureaucracy and a very few goliath government contractors to date. We no longer have the luxury to spend endlessly on going into orbit and beyond, yet we know it is human destiny to explore our universe. All of this matters big time. Musk is actively pursuing a broad but selective set of challenges that he decides warrant his time and focus. This is real turf with lasting impact. It creates sustainable, well-paying jobs. Even when it fails, it moves the ball forward.

He is courageous and daring, but not reckless.

Earlier this year when Elon Musk was profiled on 60 Minutes, he said he was an engineer first. I do think he believes that, which is part of what makes him great, but even more than an engineer, even more than innovator, he is a pioneer. To be a pioneer in technology doesn’t just mean you have interesting ideas. It means you stand by your ideas and will them into being. Musk said in the 60 Minutes piece that with SpaceX he went “past strike 3 to strike 4,” not just betting the farm in failure, but staying with his conviction to the last test he could fund, even if it meant losing everything. He knew he was right, and if he wasn’t right, he needed to exhaust every resource at his disposal to make the case that he should have been right. When Musk recently faced a roadblock in submitting a competitive bid for a government contract controlled by Lockheed Martin and Boeing, he sued the federal government for the right to compete at substantially lower cost. Imagine the guts, to take on his own customer in a public forum, risking financial ruin for a principle. He won an injunction from a federal judge. Whether he ultimately prevails in winning the contract (and I think he will), there is little question that the price of that contract is coming down. Want to know how to get the government to think smarter about our tax money? I like this way.

He walks the walk, with standards that matter.

So much of what I write about on this blogideas like “good enough is not good” and “eat your own dog food”are very hard to understand unless you have lived them. If you’re lucky in your career, you get to work for someone for a while who grinds this stuff into your brain until you literally cannot act any other way, no matter the stakes, no matter the challenges. If you don’t get a boss who inserts that chip into the back of your spinal cord, study Elon Musk. You can’t cut corners on quality with the work he tackles, or people die. Of course you’re going to say, Well, in automobiles and rockets, people do die. Sadly in the march of progress where new machinery does fail, there is no way around that no matter the commitment to extraordinary quality, but the question is, what is the ethos at the core of an enterprise? Is it profit first, a love letter to Wall Street with lip service to safety and excellence? Or is it a standard of safety and excellence that exists a priori to all other decision-making that of itself creates value? When I see Musk discuss failure or success in any public setting after something has gone wrong or right, I don’t worry that his statement has been pureed by a publicist. I see an engineer who knows winning means perfection, and as elusive as perfection remains, he is never self-satisfied, never standing on his laurels. What do you really need to say about a reusable rocket that leaps sideways and then lands on its launchpad? The Grasshopper speaks for itself.

Why write about Elon Musk?

In this never-ending discussion of whether we are in a tech bubble, I have grown weary of broad generalizations. If all we are worried about is whether the stock market is due for a correction, then we are wasting brain cycles on an inevitable head fake we cannot control, so why bother? Our world has an abundance of trendy apps, head-bobbing diversions, and flavor-of-the-month prognostications of what at the moment constitutes cool. You know what’s cool? Stuff that lasts, stuff that can have a lasting impact on growing our economy, stuff that makes scientific dreams into tangible realities, and stuff that in doing so makes investment capital make sense. Musk is doing that, which to me looks like real leadership, and it feels good to applaud him. I don’t care that he is a billionaire. I care that he is a creative leader, with half his life likely still ahead of him to teach us things we don’t know and take us places we couldn’t otherwise find.

As Andy Grove taught us decades ago, Only the Paranoid Survive. Somewhere along the ride, Elon Musk must have gotten the memo. He is probably rewriting it with some form of ink yet to be discovered.

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The Ultimate Broker

“Uncovering hidden supply to meet pent-up demand is the magic behind some of today’s most exciting start-ups.”

I read that opening phrase in a Heard on the Street WSJ Article by Rolfe Winkler last week and it stuck with me. It’s not a particularly new idea, but it is elegant, simply stated, and true.

At its core, the internet in many ways is a giant marketplace—a shared global space for socializing, exchanging ideas, buying and selling goods and services, hanging out, observing human behavior—occasionally offering spectacle, always stimulating interactive exchange.

Uncle PennybagsIn the simplest terms, a broker brings together buyers and sellers. A broker can be a person or it can be a facility. It is a go-between function for give and take—introductions, descriptive information, negotiation, resolution. The act of brokering can be formal and compensated with paid commissions or informal and somewhat ephemeral.

It was anything but coincidental that discount stock brokerages like Charles Schwab and TD Ameritrade made a beeline to the commercial web in its earliest days, circa the mid 1990s. Some observers eventually came to blame much of the dot-com bubble on too easy access to day-trading by non-professionals. A good many individuals who prior to loading their first browser never met a stock broker found themselves easily comfortable with entering their own trades at hugely reduced transaction fees where professional labor costs were eliminated. We all know that didn’t turn out well for a lot of folks and the overall economy, but the point remains that the excitement of the internet’s adoption was fueled by people using the internet to buy and sell a whole line-up of newly created internet stocks. Marshall McLuhan deja vu, eh? Not sure we will see a self-referential kaboom quite like that again in our lifetime, though the public’s hunger for IPOs built on entirely new business paradigms (proven or not) still seems rather insatiable.

One of the things the internet does well is bring efficiency to the brokering process. Success stories are a virtual Who’s Who of celebrated internet brands—eBay, Priceline, Expedia, Travelocity, Craig’s List, Etsy, Airbnb—any number of much embraced marketplaces where the site of exchange never takes possession of physical inventory on its balance sheet, but instead acts as an agent to connect what is for sale with both new and loyal customers. A myriad of innovative payment models has been developed to compensate these broker-marketplaces for the service they provide, but in almost all instances they have lowered transaction costs, passed those savings along to customers, and increased total sales volume in the categories tackled. This mostly customer-friendly way of doing business is now every bit as normal for us as sitting on the back side of a travel agent’s CRT monitor waiting for him to input an airline seat query into Sabre not even a full generation ago (like, when I was in college). What others used to do for us we now do for ourselves, happily in most cases, and because of the savings and easy access, we do it a lot more frequently.

I have been spending a reasonable amount of time of late helping a number of start-ups get off the ground—formally and informally, no shameless plugs today, but I do mention them often in my tweets—and one of the constants in determining my excitement level is how thoroughly an emerging visionary has thought through a problem of reinvention. If we take it on faith that basic human needs and behaviors don’t change that much—we sleep, we eat, we learn, we love, we move, we fight, we heal, we protect, we shop—then the march of progress marked by improvements in technology finds reward when disruptors help us do those things better.

Returning to the quote that kicked off this post, when an entrepreneur is able to identify an abundance of largely unknown supply and connect it with a steady stream of curiously hidden demand, new business can boom. In the realm of the marketplace, anytime a business can innovate around streamlining the availability and visibility of products and services in need of buyers—and buyers motivated to use these new tools are driven to discover otherwise opaque inventories—a new brokerage is born. This can bring to bear a cruel process of creative destruction on entrenched competitors without the willingness or vision to change, but in our current economic landscape, it can offer a steady flow of more efficient business endeavors that inspire imagination and eliminate unnecessarily inflated costs. Pooled information, often in the form of personal opinions and reviews, is a freely traded currency, a form of entertainment in itself. Add social sharing playfulness along with clever experiments in curation and the fun really begins.

The innovation I am seeing both as an insider and an outsider suggests we are nowhere near maturity in reinventing how sellers find buyers and vice-versa—through digital channels and whatever awaits us beyond mobile, social, and local electronic communities. That should be good news as the availability of previously gated inventory finds its way into the supply chain and into the hands of delighted customers. Each new successful brokering start-up comes with its own spin. Some are truly wacky, some are obvious in hindsight, some too quickly migrate from wacky to obvious. I have little fear that all the people functions of brokering will be replaced—there will always be demand for great customer service and high touch assistance that adds value—but I do know that increasingly over time we will stop paying high fees for anything that doesn’t add much value. That’s the way of efficiency, and a great use of connective technology, where I’m pretty sure we ain’t see nothing yet.