How Did Elon Musk Make His Money?
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Musk grew up in a middle to upper-class family. Though they were quite comfortable financially, they had nowhere near the net worth Musk currently has accumulated. However, before he was the world's richest person putting his financial weight behind presidential elections, Elon Musk started making his money by starting the company Zip2. The company was acquired by Compaq in 1999 for $307 million, of which a 27-year-old Musk pocketed $22 million.
Here are a few key takeaways from Elon Musk's net worth:
Current estimated net worth: $372.7 billion
Net worth rankings: Musk is currently ranked as the richest person in the world, putting him in front of second place Jeff Bezos who has an estimated net worth of $201.2 billion, and Mark Zuckerberg in third place with an estimated net worth of $189.1 billion
Tesla stock: Musk's biggest pay package is from Tesla as it is current price is about $258 of which Musk owns approximately 410.8 million shares, representing roughly 12.8% of the company's outstanding shares. This stake is currently valued at around $92.6 billion.
With so many financial successes under his belt, it's not hard to see why Musk is lauded for his business acumen. Here's a closer look at the timeline in which Elon Musk built his substantial fortune.
How did Elon Musk start building his fortune? Like many 12-year-olds, Musk had a passion for video games as a child. However, unlike most kids, he already had a strong entrepreneurial passion.
As a pre-teen, Musk created and sold his first video game. Named Blastar, he earned $500 when the source code was published in a magazine, according to the blog, Wait But Why.
At age 17, he left his native South Africa for Canada. He later entered the U.S. as a college student by transferring to the University of Pennsylvania. Upon graduation, he briefly enrolled in a Ph.D. program at Stanford, but quickly left to get in on the dot.com boom of the mid-90s.
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Early on in his career, Musk joined forces with his brother Kimbal to start the company Zip2 — best described as an early version of Yelp and Google Maps. Here are some steps Elon Musk took along the way of his financial journey:
Zip2 was acquired by Compaq in 1999 for $307 million, of which a 27-year-old Musk pocketed $22 million.
Musk went on to invest three-quarters of his net worth into the company now known as PayPal, which he co-founded.
He briefly served as CEO but was replaced by Peter Thiel in 2000. Instead of walking out, he opted to stay on with the company in a senior role, until selling PayPal to eBay for $1.5 billion in 2002.
As the largest PayPal shareholder, Musk walked away with $180 million.
Many people would have simply taken this larger-than-life fortune and retired, but not Musk. Instead, he invested $100 million to start SpaceX, $70 million to found Tesla and $10 million in SolarCity.
Musk founded SpaceX in 2002 and serves as CEO of the company. He founded Tesla in 2003 and is also the CEO of the electric automaker.
Tesla has a market cap of $846.47 billion, as of July 21.
SpaceX is not publicly traded but is valued at $127 billion, as of July 21, according to Forbes.
Musk's cousins Peter and Lyndon Rive founded SolarCity in 2006. Tesla purchased the company for approximately $2.6 billion in 2016.
He also co-founded Neuralink and The Boring Company and serves as CEO of both.
It is also estimated that thanks to Tesla's electric vehicles and SpaceX, Musk showed a crazy gain of $293.7 billion during the first year of the pandemic.
In 2024, the Federal Election Commission reported that Musk put about $11.2 million into his main super PAC, America PAC, which brought his total political giving for the cycle to more than $290 million for the Trump campaign, making him a mega donor.
Musk's net worth has climbed by more than $200 billion in 2024, a massive increase in the same year he spent a massive amount backing Trump and other Republican candidates. It's estimated he's made more than $170 billion since Election Day.
Whether you're currently overspending or simply putting your money in the wrong investments, Musk's money moves are certainly something to think about. While he does make some stereotypical billionaire purchases, many aspects of his spending are remarkedly normal.
Applying at least some of these tips to your lifestyle probably won't turn you into the richest person in the world, but it can help you get a better hold on your finances.
Musk has a habit of making money and re-investing it in his next business venture. He could've spent his first fortune on lavish homes, cars and vacations, but he didn't.
For example, he continued this trend when he scored his payout from the sale of PayPal to eBay in 2022, by investing a chunk in SpaceX, Tesla and SolarCity. These smart money moves have allowed him to become one of the richest people in the world.
Scoring massive paydays on the sale of not just one, but two companies is a huge accomplishment. However, Musk did take a gamble by re-investing all or most of his money to launch new companies.
Many other people would've played it safe by finding safer investments for their funds, but Musk has taken many risks — and they tend to quite literally pay off.
Given the size of his bank account, Musk could afford any number of expensive hobbies. However, he still seems to somewhat live beneath his means as the activities he enjoys in his leisure time seem notably normal. Musk has said he enjoys listening to music in the car, playing video games, spending time with his kids, hanging out with friends and watching movies.
Jennifer Taylor contributed to the reporting for this article.
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