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Musk is great at raising money on empty promises, and that is what SpaceX has really needed. They are on series O or P at this point. Anyone who was less good

Musk is great at raising money on empty promises, and that is what SpaceX has really needed. They are on series O or P at this point. Anyone who was less good at turning hype into money would not have gotten to that point.

photonbeam 4y ago
Part of that is refusing to IPO, and still wanting to grow into new areas that revenue doesn’t yet support
- pclmulqdq 4y ago
  There's a big story floating around that Musk didn't run a SpaceX IPO by choice. I think the reality is probably pretty different: SpaceX doesn't look like it's in any shape to support being a public company from the financial breadcrumbs we have been given. The IPO would be huge, but the company needs more than just an IPO, it will need to continue doing secondary offerings to raise money (in contrast to Tesla, which doesn't at all). For those secondary offerings, you put downward pressure on your stock price, and markets start to eventually pick up expectations that you will make enough money to support a given valuation if you want to keep it. SpaceX's valuation is too high for just the Falcon 9 launch business to be worth continual secondary offerings. So they need something amazing - which is supposed to be Starlink today, but could have been "mars" or "asteroid mining" or whatever else. Without this rocket, Starlink doesn't look like it has massively positive unit economics either. Hence you get a company that is eternally raising money from private and venture markets on future promise and hype, paired with the perfect CEO to do those raises.
Nevermark 4y ago
> Anyone who was less good at turning hype into money would not have gotten to that point. FTFY: Anyone who was less good at turning hype into money into significant achievements ... Musk might not hit his target time tables. He might not deliver everything he plans to. But he still delivers things other entities have yet to match, or took a serious amount to time to match. Investors, and people who care about his projects, don't care about him keeping every promise. They care about results. If a CEO and his team get motivated by impossible time tables, then let them motivate themselves with impossible time tables. (Counter example? FWIW, any benefits of his foray into Twitter are not yet clear to me.)
- pclmulqdq 4y ago
  You didn't need to fix it - I meant what I said. Given the money, the achievements are not that hard. According to people I know who worked at SpaceX, there is a whole layer of management that exists to handle Musk the way you would handle a boy king. They basically insulate him from making any decisions that can really hurt the company. I have heard of one instance where they spent 3 weeks quietly convincing him out of a wrong decision before announcing that he made the other choice (once he changed his mind and agreed to it). It doesn't sound like a company that needs such a management layer is getting their ability to accomplish things from the boy king, just the name and the money. AFAICT this management scheme is shotwell's doing, and you should probably credit her for the accomplishments. Also, we're seeing this dynamic play out in electric cars. Once they became economical to make (and no, Tesla wasn't really responsible for that), other carmakers are now out-competing them.
  - Nevermark 4y ago
    > Given the money, the achievements are not that hard. I have no idea what you would think would be hard. What SpaceX has done with their investors money hasn't been matched by anyone in the rocket industry. Many attempts have ended in complete failure. The closest competitors in recent years, in terms of a consistent string of steady solid advancements, have been the Chinese. And they are still far behind. Whether Musk is a challenging person to work for, doesn't add or subtract from that.
    - pclmulqdq 4y ago
      Nobody in the rocket industry has had anywhere near that level of money invested in them, so they haven't gotten the results. SpaceX outspends them 100:1 or more on R&D. Everyone else in the industry has to make a profit on their services, too. If you want to see companies with comparable levels of spending to Musk companies, you have to look outside rockets. By the way, I'm not knocking the man: getting that much money to spend on rockets is an incredible achievement. Someone who did something comparable literally won a Nobel prize (the administrator responsible for making sure LIGO got enough money). Actually spending it on rocket technology once you have it isn't hard. Edit: Hard projects in the space sector would be things like landing and operating a massive rover or a human colony on mars (or the moon for that matter), or building very new instruments like the JWST - doing things that are fundamentally new. Starlink with cubesats would have been pretty revolutionary (instead of car-sized, 1-ton monsters), and absolutely crushed the economics. The current version of starlink is basically LeoSat (one of a fee companies Musk probably heard about before starting the Starlink project) with enough initial capital to not go broke. If they can get starship launches up and running with the economics they promise, that would be hard. The first vertically-landing rocket did it in the 1960's. Commercializing from that point was just a matter of investment. SpaceX has contributed meaningfully to rocket engine technology, but I doubt Musk knew anything about that.

photonbeam 4y ago

Part of that is refusing to IPO, and still wanting to grow into new areas that revenue doesn’t yet support

pclmulqdq 4y ago
There's a big story floating around that Musk didn't run a SpaceX IPO by choice. I think the reality is probably pretty different: SpaceX doesn't look like it's in any shape to support being a public company from the financial breadcrumbs we have been given. The IPO would be huge, but the company needs more than just an IPO, it will need to continue doing secondary offerings to raise money (in contrast to Tesla, which doesn't at all). For those secondary offerings, you put downward pressure on your stock price, and markets start to eventually pick up expectations that you will make enough money to support a given valuation if you want to keep it. SpaceX's valuation is too high for just the Falcon 9 launch business to be worth continual secondary offerings. So they need something amazing - which is supposed to be Starlink today, but could have been "mars" or "asteroid mining" or whatever else. Without this rocket, Starlink doesn't look like it has massively positive unit economics either. Hence you get a company that is eternally raising money from private and venture markets on future promise and hype, paired with the perfect CEO to do those raises.

Nevermark 4y ago

> Anyone who was less good at turning hype into money would not have gotten to that point. FTFY: Anyone who was less good at turning hype into money into significant achievements ... Musk might not hit his target time tables. He might not deliver everything he plans to. But he still delivers things other entities have yet to match, or took a serious amount to time to match. Investors, and people who care about his projects, don't care about him keeping every promise. They care about results. If a CEO and his team get motivated by impossible time tables, then let them motivate themselves with impossible time tables. (Counter example? FWIW, any benefits of his foray into Twitter are not yet clear to me.)

pclmulqdq 4y ago
You didn't need to fix it - I meant what I said. Given the money, the achievements are not that hard. According to people I know who worked at SpaceX, there is a whole layer of management that exists to handle Musk the way you would handle a boy king. They basically insulate him from making any decisions that can really hurt the company. I have heard of one instance where they spent 3 weeks quietly convincing him out of a wrong decision before announcing that he made the other choice (once he changed his mind and agreed to it). It doesn't sound like a company that needs such a management layer is getting their ability to accomplish things from the boy king, just the name and the money. AFAICT this management scheme is shotwell's doing, and you should probably credit her for the accomplishments. Also, we're seeing this dynamic play out in electric cars. Once they became economical to make (and no, Tesla wasn't really responsible for that), other carmakers are now out-competing them.
- Nevermark 4y ago
  > Given the money, the achievements are not that hard. I have no idea what you would think would be hard. What SpaceX has done with their investors money hasn't been matched by anyone in the rocket industry. Many attempts have ended in complete failure. The closest competitors in recent years, in terms of a consistent string of steady solid advancements, have been the Chinese. And they are still far behind. Whether Musk is a challenging person to work for, doesn't add or subtract from that.
  - pclmulqdq 4y ago
    Nobody in the rocket industry has had anywhere near that level of money invested in them, so they haven't gotten the results. SpaceX outspends them 100:1 or more on R&D. Everyone else in the industry has to make a profit on their services, too. If you want to see companies with comparable levels of spending to Musk companies, you have to look outside rockets. By the way, I'm not knocking the man: getting that much money to spend on rockets is an incredible achievement. Someone who did something comparable literally won a Nobel prize (the administrator responsible for making sure LIGO got enough money). Actually spending it on rocket technology once you have it isn't hard. Edit: Hard projects in the space sector would be things like landing and operating a massive rover or a human colony on mars (or the moon for that matter), or building very new instruments like the JWST - doing things that are fundamentally new. Starlink with cubesats would have been pretty revolutionary (instead of car-sized, 1-ton monsters), and absolutely crushed the economics. The current version of starlink is basically LeoSat (one of a fee companies Musk probably heard about before starting the Starlink project) with enough initial capital to not go broke. If they can get starship launches up and running with the economics they promise, that would be hard. The first vertically-landing rocket did it in the 1960's. Commercializing from that point was just a matter of investment. SpaceX has contributed meaningfully to rocket engine technology, but I doubt Musk knew anything about that.