July 20, 2014

How to change the world the help of Elon Musk

If you've decided to change the world with a revolutionary company, this article is a must read. Someone else who is changing the world is the entrepreneur Elon Musk. He has founded companies like Tesla Motors (electric cars) and SpaceX (rockets). So maybe you can learn something from how he did it:

The quotes are by Elon Musk

Step 1. Learn by doing. Elon Musk believes you can learn everything you need to start a company. But an education will speed up the learning process. What you need to study is both engineering and economy - Elon Musk studied both physics and economy. 
"I think you could learn whatever you need to do to start a successful business. There are examples of successful entrepreneurs who never graduated from high schools, and there are those with PhDs. So I think the important principle is to be dedicated to learning what you need to know."
"I studied physics and business, because in order to do these things you need to know how the universe works and how the economy works and you also need to be able to bring people together to create something. It's very difficult to create something as individuals if it's a significant technology."

Step 2. Make a lot of money by selling a company you didn't need a lot of money to create. If you want to create a car company, then you need millions. No outside investors will give you those millions, so you need to have them on your bank account. This will probably be an Internet company. Elon Musk founded two Internet companies, Zip2 and PayPal, and he had a car and a few thousand dollars when he founded Zip2. 
"Unless you've got a ton of capital that someone gave you or you've inherited, you have to start a company that requires a small amount of capital. It would have been impossible for me to have done electric cars or rockets right from the start."


Step 3. Find a big problem you want to solve. Elon Musk came up with three things that in the future will change the world. They were: the Internet, space, and how to stop the world from using fossil fuels. 
"I'm not trying to paint myself as some sort of saint. I'm just making the point that the success of the company doesn't change my life. These are the problems that I think are important and need to be solved, and I'm trying to help solve them."

Step 4. Find a solution to the problem by reasoning from a physics standpoint. You can first say that battery packs for electric cars will always be expensive because they have always been expensive. From a physics standpoint, you can break the batteries down into the materials they are made of, and then ask what the value is of those materials on the commodity market. You will now realize the material is not as expensive as the final battery pack, so you just have to come up with a way to improve the manufacturing process.
"I think that physics is a good analytical framework. One of they key things in physics is to reason from first principles. This is contrary to the way most human reasoning takes place, which is by analogy ['We'll do that because it's always been done that way' or 'Nobody has ever done that so it must not be good']. Reasoning from first principles just means that you figure out what are the fundamental truths, and can you build up a conclusion from that? Reasoning by analogy is helpful because it's a shortcut, and is mostly correct, but tends to be mostly incorrect when you are dealing with new things."

Step 5. Recruit experts and students without any experience. Elon Musk wanted students without any experience because they don't yet know what's impossible. Someone with experience may think that you can't build cheap rockets, but a student is easier to convince. But you also need experts that can teach the students (and Elon Musk himself since he didn't have any experience from neither rockets nor electric cars). But how can you recruit experts? What Elon Musk did when he founded SpaceX was to invite experts to a series of meetings where he presented facts. He let the experts discuss the facts until they convinced themselves.
"I essentially led them to a conclusion that they created. It was sort of a Socratic dialogue on a technical level. The essence of a Socratic dialogue is that people wind up convincing themselves. People are much more willing to change their opinion if you're not forcing it."

Step 6. Endure misery. Companies that change the world are solving problems that are extremely difficult to solve. So as you fail, you have to endure misery to not give up. 
"I do think you've got to have perseverance. You've got to stick it out, and the team that you're working with does, too. That allows you to get through a series of issues. It took us four flights to get to orbit at SpaceX. That was kind of grueling."

That's it! What are you waiting for? Go out and change the world! But if you can wait, then you should read more about Elon Musk by reading my biography book

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