Image of Elon Musk and a Tesla Model X
© Juverton

Elon Musk is not my Steve Jobs

There are a lot of reasons to like Elon Musk. From founding Zip2 to setting Tesla/SpaceX on what’s now a blazing path of astronomical growth (pun intended), Elon is a proven 21st-century entrepreneur. If you’re thinking, well, that’s not enough to sway me into the ‘glory glory Elon’ crusade, then perhaps Tesla’s valuation and the compounding list of rag-to-riches stories it continues to create should set you straight.

It surely set me straight, and I’ve been thinking, hold on, this guy may actually be a genius — maybe not the Tony Stark Superhero genius his diehard fans claim him to be but more of the savvy entrepreneur kind of Genius complete with all wittiness and an uncanny vision for finding and exploiting the next big idea.

The appeal for big ideas

I like to think that the World is at the tipping point of its wait for our next Eureka moment. Something in the scale of Microchip development in the mid-late 20th century or the debut of the internet and subsequent internet boom earlier at the start of the 21st century. The problem is that while anticipation is already brimming over, the technology to piggyback our ascent into a newer state of doing things — a newer state of progression if you like — is still very elusive.

Major technological contenders have mostly proven to be limited, being incremental rather than exponential (AI, VR), or extremely difficult to scale and/or execute (quantum computing). Without the technology or the assets, there will be no disruption, and in the absence of disruptive changes, it’s only normal to extend our frothing anticipation to the next big thing — big ideas.

Why anticipate

With every successful paradigm shift in the way things are done comes an onslaught of proud newly minted millionaires. These are the anticipators, those who believed in the concept, idea, or actual tech solution and who bothered to commit resources (time, money, etc.) to propagating such solutions.

Back to big ideas

Big ideas carry the weight of actual working concepts/technologies because people perceive them as having immense potential. Electric cars — potential to severely cut down carbon emissions ergo strengthen our stance against climate change. Space X — potential to establish a Mars colony. Solar-City — potential to turn energy dependency away from carbon-based sources toward green sources. I’m citing Musk-specific examples because this piece is, after all, a subtle critique of Musk’s person (in case you haven’t noticed), but there are countless other examples of ideas and the potentials people ascribe to them.

If these potentials were ever met, the entities that conceptualized these ideas and the anticipators would make serious bank. Traditionally, this is how the entrepreneur — idea — investor — investment cycle works. Someone conjures up a big idea, people bank on it, the idea floats into a practical solution, and everybody wins.

When it’s a big idea, the scales are higher, the wins are bigger, and the stakes are commensurately higher. Higher stakes mean such ideas need a catalyst big enough to be categorized as a Eureka moment to take them from idea to working solution. What do you when you have the idea, the anticipation but not the Eureka technology to complete the big idea cycle? It’s simple; you become Elon Musk (or Trevor Milton).

Daddy Musk

Like his many likable attributes, Elon goes by many names. Many call him Genius. Some call him ‘serial innovator.’ If you’re a frequent visitor of the r/wallstreetbets subreddit, you’d know him by the more suave moniker ‘Daddy Musk.’ These names represent who Elon Musk is to different individuals, but I prefer to call him Travis Kalanick.

Travis Kalanick is Uber’s CEO. I’ll tell you why Elon Musk comes off as his Silicon Valley colleague to me.

What is Tesla

Tesla describes itself as the godsent accelerator of the World’s transition to clean and sustainable energy sources. To do this, the company plans to mass-produce affordable but still premium electric vehicles (EVs).

In 2020 General Motors CEO Mary Barra had this to say in Barclay’s hosted conference:

“Climate change is real, and we want to be part of the solution by putting everyone in an electric vehicle,” “We are transitioning to an all-electric portfolio from a position of strength, and we’re focused on growth.”

In essence, GM is also planning to ‘accelerate the world’s transition to sustainable energy,’ and it also wants to produce affordable EVs. It’s a direct competitor of Tesla. Historically, it’s a more established business that has consistently returned profits (yeah, come at me, Musk faithful). For some reason, however, investors believe it’s a lesser cousin to Tesla.

Tesla’s market capitalization has literally hit the roof, surpassing GM’s valuation by well over $769 billion, making Musk the wealthiest person alive with his company, Tesla, now worth more than the worlds top five automakers combined. Cool stuff. The logical explanation for this sky-high market value and a searing stock price of $880 is that Tesla anticipators believe it’s the next big thing.

How big of a thing is Tesla?

If you were to ask Musk or any Tesla proponent what the value proposition of Tesla was, you would most likely get a chorused answer of INNOVATION. Tesla markets itself as the futuristic car company (I’ll have to admit, its car designs are well on point with futurism, and I love it) propelled by innovation and technological giant leaps. Technically, this is what makes Tesla’s lineup of EVs special, and even more importantly, it is what’s supposed to set them apart from their competitors.

But how different is Tesla from the typical EV manufacturer? How different is the Model S from the Nissan Leaf? Or the yet to be released Roadstar from the Porsche Taycan? If you take a practical look at Tesla’s lineup of EVs, barring the aesthetically pleasing minimalism, it’s still a traditional EV vehicle with traditional EV components that work just like the traditional EV car. Innovation in the sense of the Tesla styled disruption starts and ends in vehicle design.

At the core, each Tesla car still runs like the typical EV from 5 years back. And while Elon Musk would have you look at a long list of patents to justify the ‘we are an innovation first company’ mantra, here’s a reminder that patents have never been a definitive marker for innovation.

Consider this, for all the patents it holds; the company still outsources (the official word is ‘partners’) battery manufacturing to third parties (Panasonic of Japan).

Tesla is Uber for the automotive industry

Like Tesla, GM also outsources its battery manufacturing to Japanese companies (LG Chem.). To be fair, this is standard practice in the car manufacturing business. However, unlike Tesla, GM’s EV manufacturing division is not the next big thing.

And if you critically look at it, Tesla is not the next big thing on the technical sheet either. What it is is a company that’s efficiently capitalizing on the next big idea — the idea of significantly greener cars. The company has been able to garner for itself this highly-priced next big thing brand identity through a very carefully orchestrated marketing campaign, much like Uber was able to prop itself up over traditional taxi companies as the next big thing in the car-hailing industry.

The big idea is a clean energy source to make our World an even greener place to live. Much to Musk’s credit, Tesla has been able to align itself as the next big thing to usher in this paradigm shift. That’s despite being fundamentally the same in terms of core manufacturing prowess, tech-stack, and unique feature offerings as the more established global automobile big game players. Tesla was able to do this because of Elon.

Glory glory Elon

What Elon has done is by no means a small feat. Again, look to Tesla’s valuation if you doubt that assertion. However, rather than picture it as what Elon has done for the World, or for climate change, or for our unborn kids, I see it as what Elon has done for Tesla. He turned what was a shabby car manufacturing company, burning through its cash reserves, into the World’s most valuable car company.

For that, I like to call him a very savvy businessman, not Tony Stark, not Martin Luther King, or our Lord and personal savior.

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Onoja Omale

Onoja Omale

Pessimist. Because all good things end, eventually.