WEBVTT 1 00:00:01.439 --> 00:00:06.519 Elon Musk, at three hundred and thirty billion dollars, was the richest man 2 00:00:06.559 --> 00:00:11.599 in the world. But then Tesla's stock has plummeted more than sixty five percent 3 00:00:12.080 --> 00:00:16.280 since the start of twenty twenty two. He's no longer the world's richest man, 4 00:00:16.480 --> 00:00:20.440 and his ev company is on track for having its worst year in the 5 00:00:20.519 --> 00:00:25.480 stock's history. By the end of twenty twenty two, Musk lost more than 6 00:00:25.559 --> 00:00:29.160 half his net worth. On paper, on any given day, he could 7 00:00:29.199 --> 00:00:32.479 be the world's richest man, or he could be the world's second richest man. 8 00:00:32.679 --> 00:00:36.719 Or you know, he might fall because the share value of Tesla falls. 9 00:00:36.759 --> 00:00:40.479 Most of Musk's wealth is tied up in shares of his businesses. That 10 00:00:40.520 --> 00:00:45.640 means volatility in his company's stock and valuations can directly sway his net worth. 11 00:00:47.320 --> 00:00:51.600 In the last few months, Musk has recovered some lost ground. His net 12 00:00:51.640 --> 00:00:56.240 worth, according to the Bloomberg Billionaire Index, is now estimated at about one 13 00:00:56.359 --> 00:01:00.320 hundred and sixty billion dollars, but the trajectory of his key businesses has some 14 00:01:00.439 --> 00:01:07.159 investors concerned. Here's how a volatile stretch for some of his companies is impacting 15 00:01:07.239 --> 00:01:12.040 Musk's net worth. Elon Musk's wealth really balloon during the pandemic, but in 16 00:01:12.079 --> 00:01:17.280 the past year so we've seen it go on a kind of a wild roller 17 00:01:17.280 --> 00:01:21.079 coaster. The Wall Street Journal reached out to Elon Musk for common but he 18 00:01:21.120 --> 00:01:25.680 did not respond. Since he took over Twitter roughly six months ago, there's 19 00:01:25.719 --> 00:01:30.480 been lots of questions about his overall management style and wondering if perhaps some of 20 00:01:30.519 --> 00:01:36.560 the magic has been rubbed off. Musk is a serial entrepreneur. He made 21 00:01:36.680 --> 00:01:41.400 twenty two million dollars selling his first startup in nineteen ninety nine, an internet 22 00:01:41.439 --> 00:01:46.519 business called zip two, then bent most of that money on a startup PayPal. 23 00:01:46.959 --> 00:01:51.439 When eBay bought PayPal, he made one hundred and sixty five million dollars 24 00:01:51.480 --> 00:01:56.640 and used that to found SpaceX and become an early investor in Tesla. He 25 00:01:56.760 --> 00:02:00.920 bought Twitter in October twenty twenty two for forty four billion dollars, funding some 26 00:02:01.040 --> 00:02:06.280 of the purchase by selling thirty nine billion dollars worth of his test last shares. 27 00:02:07.359 --> 00:02:09.800 It's been a rocky a few months since its takeover. Twitter has never 28 00:02:09.840 --> 00:02:14.719 been a company that's made a lot of money, oftentimes being unprofitable on an 29 00:02:14.719 --> 00:02:20.919 annual basis. But he takes control and immediately he says he needed to start 30 00:02:21.000 --> 00:02:25.400 making dramatic changes. Soon after the purchase, Musk fired top executives, laid 31 00:02:25.400 --> 00:02:30.319 off thousands of employees, and said advertisers cutting ad spending had led to a 32 00:02:30.360 --> 00:02:35.759 massive drop in revenue. He thinks, he's, in essence rights sized the 33 00:02:35.879 --> 00:02:38.360 ship, but now it's a private company, so we don't know exactly what's 34 00:02:38.400 --> 00:02:43.319 going on in there. Musk's ambitions for Twitter are a mix of content, 35 00:02:43.520 --> 00:02:47.520 communication, and commerce, similar to popular Chinese social media platform we Chat. 36 00:02:49.039 --> 00:02:53.240 All this, Musk says, will help turn Twitter into a company worth two 37 00:02:53.319 --> 00:02:58.159 hundred and fifty billion dollars. But for now, Twitter is valued around twenty 38 00:02:58.159 --> 00:03:01.759 billion, and I remember, twenty billion dollars is dramatically less than what he 39 00:03:01.919 --> 00:03:07.360 acquired the company for the deal that was around forty four billion dollars. So 40 00:03:07.639 --> 00:03:12.319 just imagine his wealth going like this, and it's just been a wild ride 41 00:03:12.360 --> 00:03:16.719 to watch Elon. Musk's main source of wealth is Tesla. As of late 42 00:03:16.759 --> 00:03:23.120 April twenty twenty three, Tesla was worth about five hundred billion dollars and Musk 43 00:03:23.199 --> 00:03:28.599 owns about thirteen percent of a company. Tesla grew significantly in twenty twenty up 44 00:03:28.639 --> 00:03:31.680 to a peak value of one point two trillion dollars in twenty twenty one, 45 00:03:31.960 --> 00:03:37.360 but it fell significantly last year, down to a round three hundred and ninety 46 00:03:37.400 --> 00:03:42.919 billion, and all that fluctuation has affected Musk's personal wealth. While Tesla's stock 47 00:03:43.000 --> 00:03:47.280 has rebounded slightly in twenty twenty three, investors have a few concerns the amount 48 00:03:47.319 --> 00:03:53.120 of time Musk spends focused on Twitter and Tesla's price cuts that have reduced profit 49 00:03:53.159 --> 00:03:58.879 margins on each car itselfs well, Tesla is profitable and it's projecting a dramatic 50 00:03:58.879 --> 00:04:03.840 growth into the future. The question is how dramatic and how profitable. Musk 51 00:04:03.919 --> 00:04:10.280 also envisions a future where Tesla's continue making money for the company after someone initially 52 00:04:10.280 --> 00:04:14.520 purchases the car, for example, charging for software updates, and that's a 53 00:04:14.560 --> 00:04:19.680 big bets in a lot of ways, an industry upending business model. Tesla 54 00:04:19.759 --> 00:04:26.279 has not yet shown the ability to deploy fully autonomous vehicle technology, and so 55 00:04:26.319 --> 00:04:30.319 he's essentially telling the world this is coming and we're going to make a lot 56 00:04:30.360 --> 00:04:32.480 of money down the road. In Wall Street's not so sure about that. 57 00:04:34.680 --> 00:04:40.839 And then there's SpaceX. Musk founded the company in two thousand and two with 58 00:04:40.959 --> 00:04:45.720 money he got from selling his stake in PayPal, and while SpaceX doesn't release 59 00:04:45.800 --> 00:04:48.560 financials, last year, the company was valued at a round one hundred and 60 00:04:48.600 --> 00:04:54.399 forty billion dollars. As of twenty twenty two, a trust associated with Elon 61 00:04:54.480 --> 00:04:59.920 Musk owned forty two percent of the company. SpaceX executives recently said it's making 62 00:05:00.079 --> 00:05:04.519 money off of its Falcon nine rockets and Dragon spacecraft, and executives expect Starlink 63 00:05:05.040 --> 00:05:11.360 SpaceX division that provides high speed broadband internet with satellites, to begin making money 64 00:05:11.480 --> 00:05:15.120 this year too. Tesla is where the bulk of his wealth is at this 65 00:05:15.199 --> 00:05:20.240 point, but SpaceX is increasingly looking like it's going to be a juggernaut onto 66 00:05:20.240 --> 00:05:27.319 its own and might be where the next kind of tranche of huge valuation comes 67 00:05:27.360 --> 00:05:32.079 from. Musk also owns three other companies, Neuralink, Boring Company, and 68 00:05:32.480 --> 00:05:39.759 x Ai. They're all privately held and their finances are unclear the other early 69 00:05:39.800 --> 00:05:44.120 stages, you know, the bulk of elong Musk's time at this point is 70 00:05:44.399 --> 00:05:49.120 in three places, Tesla, SpaceX, and now Twitter. These other startups 71 00:05:49.720 --> 00:05:55.720 are of interest to him, but he would even say that they are far 72 00:05:55.800 --> 00:06:00.680 down on the list of priorities in any given day. Musk's wealth has traditionally 73 00:06:00.720 --> 00:06:03.600 been tied up in his businesses, and he's been labeled as a cash poor 74 00:06:03.720 --> 00:06:09.959 billionaire because he has to borrow against his shares for living expenses. One of 75 00:06:09.959 --> 00:06:14.360 the things about Elon is he's become richer and richer is that it gives him 76 00:06:14.439 --> 00:06:18.480 the whereworthal and the ability to chase these kind of big ideas that he has, 77 00:06:18.639 --> 00:06:25.480 whether it's trying to make a humanity a multiplanetary species, or make electric 78 00:06:25.519 --> 00:06:30.360 cars cool, or by that shiny object that he now has, which is 79 00:06:30.399 --> 00:06:35.519 Twitter. A stumble now could kind of change his legacy, could perhaps overshadow 80 00:06:35.600 --> 00:06:42.920 his past accomplishments. Yet he's still showing a huge appetite for risk.