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How SpaceX and the Quest For Mars Almost Sunk Tesla Motors
braindrainbahrain writes: Elon Musk and his rocket company are well known to Slashdottters. This article and book excerpt tell the story of the creation of SpaceX and how it almost sank Musk's other company, Tesla Motors. Musk recalls, "I could either pick SpaceX or Tesla or split the money I had left between them. That was a tough decision. If I split the money, maybe both of them would die. If I gave the money to just one company, the probability of it surviving was greater, but then it would mean certain death for the other company." But then, at the last moment, years of work at SpaceX finally paid off: "[O]n Dec. 23, 2008, SpaceX received a wonderful shock. The company won a $1.6 billion contract for 12 NASA resupply flights to the space station. Then the Tesla deal ended up closing successfully, on Christmas Eve, hours before Tesla would have gone bankrupt. Musk had just a few hundred thousand dollars left and could not have made payroll the next day." Also, it turns out the inspiration for SpaceX was the idea of sending mice to Mars.
What would be to point of sending mice to Mars?... unless it was about sending the mice to Mars.
Linux is for people who don't mind RTFM.
Guy gets lucky and wins the lottery!
But this not the story - not literally or figuratively.
Instead real life works like this:
Guy gets lucky and wins the lottery and ....
1) loses it all within 5 years because he has now idea how to deal with his luck.
2) works his ass off to turn his momentary luck into something long lasting.
Musk, like Gates, Jobs, etc. etc. all got lucky and had to work their asses off to take a bit of luck and turn it into a thriving huge success.
But that hard work they did doesn't mean their success did not depend on their luck as much as it did on their work.
excitingthingstodo.blogspot.com
How is it legal to not have enough to pay your employees?
Laws vary from state to state. But, in general, companies must pay their employees for time worked. If the company runs out, then principals can be held liable. Smaller company, wealthy principal, employees have a reasonable chance of getting paid, enforced by their state Department of Labor. But of course if what is owed is way more than the principals' assets, then there's not much to be done.
So that's how employees are different than investors, the "corporate veil" does not protect the company owner from liability for their wages.
If everybody had an job
Across the U. S. A.
Then everybody'd be SURFin'
Like Californi-a
You'd seem 'em wearing their baggies
Old Navy sandals too
A bushy bushy blonde hairdo
SURFin' U. S. A.
I pity rose other people living in the worst timeline, without Teslas, affordable battery packs or Dragon spacecraft. Suddenly I feel lucky.
Companies must have the ability to meet their liabilities as they become due otherwise they are trading insolvent. Put simply if Tesla had reached pay day and been unable to make the payment then it would have been insolvent and it would have been illegal for them to continue trading.
However I would suggest there is absolutely no chance of that statement being true as you don't get paid for your contracts immediately so there must have been some other finance mechanism in place.
If musk wanted to make billions off spaceX he should have been sending cats to mars. Because paid access to video feed of cats doing low grav antics would break the internet and his bank account.
Uhhhh... In general, it's not legal to not pay your employees, but when a company has run out of money, it's run out of money. This is how going bankrupt works...
You've got the order of events reversed. Guy works his ass off so that he is prepared to take advantage of the opportunity when good luck strikes.
You never hear about the guys who worked their asses off but did not get lucky. There are way more of those guys than there are guys who did get lucky.
But that hard work they did doesn't mean their success did not depend on their luck as much as it did on their work.
There's a great little (light, easy-to-read) book "The Drunkard's Walk: How Randomness Rules Our Lives" which explains this very well in the last chapter. The truth is that randomness plays a huge role in success and failure of all sorts of endeavors. BUT, as the book points out with extensive examples, that doesn't mean we're powerless and just have to accept whatever the random dice of fate serve up for us. We can work hard to weight the dice a little, but even more important, we control how many throws of the dice we get. Successful people are those who are smart, hard-working and persistent
Had SpaceX not gotten the NASA contract, Tesla would undoubtedly have suffered, and Musk would have been scrambling to save it. I'd give him good odds of succeeding, too, either with alternative financing, or by closing the doors and starting over, or... something. And maybe he wouldn't have managed it, but I guarantee he wouldn't just have given up and said "Well, bad luck, I'm out". Because people who would do that don't get to where Musk is, no matter how lucky they are.
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
A law guaranteeing success would be awesome.
I am very small, utmostly microscopic.
Firstly, Tesla not the only company producing electric cars. The cost of manufacturing reduction of lithium batteries has been done by Japanese companies over the last two decades. I imagine Nissan would be moving into the businesses that Tesla is currently in.
How about another timeline, in which Armadillo Aerospace didn't have parachute failures, and was able to become a paying business?
Are you mad? Do you know how many businesses struggle with payroll? Where owners take loans (or are late paying other bills) in order to cover payroll. This is SOOOOO fu*king common. Start a business and see how often it happens to you.
If you're scared of your govt then you need to further restrict its powers
Vote 3rd Party in 2016 and beyond
He captured Throttle, Modo and Vinnie, and is sending them back home...
“He’s not deformed, he’s just drunk!”
"Sometimes he posts interesting comments, but tonight ..... he's going to post like an asshole"
I believe I read a study a while back about luck. They found that the random 'lucky' events weren't really so random. Usually the 'lucky' people worked hard to put themselves in the position for that lucky break to happen. While something like winning the lottery does take luck, you still have to put yourself in the position to have that chance at luck.
As you point out that one lucky event is a fleeting moment, it takes work to make it last.
Sorry, this postmodern English grates on my nerves.
Sheesh, evil *and* a jerk. -- Jade
Or as my late father-in-law was wont to say, "you can't lose them all".
How did we all know it would be the mice on Mars that would attract the most attention?
Start as a billionaire. This Mars stuff is a quixotic religion for nerds. Mars is a dead rock, far away. It's not the salvation of the human species, OK?
"I could either pick SpaceX or Tesla or split the money I had left between them. That was a tough decision. If I split the money, maybe both of them would die. If I gave the money to just one company, the probability of it surviving was greater, but then it would mean certain death for the other company."
I go through the same mental calculus every morning as my kids eat a week's worth of food in one breakfast.
Payroll is often met by taken loans. A $1.8bn contract from NASA would have presented sufficient collateral for Musk to get loans against.
"Lack of speed can be overcome. In the worst case by patience." --Znork
I will never be in the position where 'luck' decides between me being bankrupt and being a billionaire. I just don't do the things that would allow me to get lucky in that way.
"First they came for the slanderers and i said nothing."
Companies must have the ability to meet their liabilities as they become due otherwise they are trading insolvent. Put simply if Tesla had reached pay day and been unable to make the payment then it would have been insolvent and it would have been illegal for them to continue trading.
True. Being publicly-traded brings that regulatory aspect into it. Of course, halting trading doesn't get employees paid, but it does at least let them know what's coming :-(
Also, I think unpaid wages are a priority claim against assets, so in a bankruptcy reorganization or liquidation, employees would have priority over other creditors, and investors are further back.
Get your mice to Mars. -bzzzt- Get your mice to Mars. -bzzzt- Get your mice to Mars. -bzzzt- Get your mice to Mars...
The only thing you pay before employee wages is taxes, although that only applies to w-2 employees.
Anyone with significant ownership is a prime candidate not to be paid (for a few reasons.) 1099 contractors are one of the last though, they come after creditors.
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Luck... oh geeze this again.
So lets assume you chances of becoming a billionaire in a random lucky winner lottery, as something like 1 in a billion.
If we assume Elon Musk became a billionaire because he was "lucky" and won that 1 in a billion chance, then you also have to believe
that he isn't just lucky, but inconceivably astronomically wtf-omg-bbq lucky.
1. Created and sold a company (Zip2) for $307 million
2. Create and sold a company (Paypal) for $1.5 billion
3. Created SpaceX valued at several billion dollars
4. Created Tesla valued at $31.6 billion
5. Created SolarCity valued at $6.9 billion
So if luck is one of the key factors that make people successful, Elon Musk has proven statistics and probability are a completely broken field.
Good description.
I say that as someone doing startups with the knowledge that the failure rate is over 90%, but that I still have a long career ahead of me and I only need one to work out.
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Re:You die anyway.
You too!
It cost him enough money to live a life of luxury spent on founding companies intent on improving the condition of the human race instead of islands, yachts, and hookers.
Slashdot does not get much if any of that, but it regularly qualifies him for "news for nerds" and "stuff that matters".
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It's just a fad.
How is it legal to not have enough to pay your employees?
Laws vary from state to state. But, in general, companies must pay their employees for time worked. If the company runs out, then principals can be held liable. Smaller company, wealthy principal, employees have a reasonable chance of getting paid, enforced by their state Department of Labor. But of course if what is owed is way more than the principals' assets, then there's not much to be done.
So that's how employees are different than investors, the "corporate veil" does not protect the company owner from liability for their wages.
You have no idea what you're talking about. Unpaid wages can only be recovered via civil suit if the employer is not in bankruptcy; if the employer has declared bankruptcy, workers simply become creditors in the legal proceeding. In some jurisdictions, workers may become preferential creditors, in others they get in line with everyone else who is owed money. In no case (in the US) are owners personally liable for unpaid wages or any other unpaid creditor.
I would suggest you read this article to begin to educate yourself on the topic. Check here for further information on the matter.
And it was a very good article (book excerpt actually, now I want the book). Actually worth reading...
BlameBillCosby.com
First they needed moms, now mice, then cats & dogs too?
Those Martians gotta start fending for themselves.
You have no idea what you're talking about.
Uhm, yes, actually I do.
In no case (in the US) are owners personally liable for unpaid wages or any other unpaid creditor.
The article you link to is about FEDERAL bankruptcy law and the FEDERAL Department of Labor. It says absolutely nothing about state laws nor state departments of labor.
I have had a company that paid me several weeks late because they just had no money. Unfortunately, I had some automatic payments that went ahead and happened anyway and I ended up eating a couple of hundred dollars in NSF fees, which the company would not compensate me for. I tried to charge them a late fee, but they wouldn't go for that either.
If you are not allowed to question your government then the government has answered your question.
The company won a $1.6 billion contract for 12 NASA resupply flights to the space station.
I assume those went of without a hitch later that day and he was somehow able to get the invoice submitted and paid on the same day, a true miracle for a government agency.
If you are not allowed to question your government then the government has answered your question.
You have no idea what you're talking about.
Uhm, yes, actually I do.
In no case (in the US) are owners personally liable for unpaid wages or any other unpaid creditor.
The article you link to is about FEDERAL bankruptcy law and the FEDERAL Department of Labor. It says absolutely nothing about state laws nor state departments of labor.
Wow. I guess you figured the hole you're in wasn't deep enough, so you decided to keep digging.
FYI, there is no such thing as a state bankruptcy court, and state labor laws play no part in a bankruptcy proceeding. ALL bankruptcies in the US take place in a federal court, and are governed by federal law:
"While bankruptcy cases are filed in United States Bankruptcy Court (units[1] of the United States District Courts), and federal law governs procedure in bankruptcy cases, state laws are often applied when determining property rights."
But since you really know what you're talking about, you should easily be able to back up your claims with an authoritative source. Please, show us all one single case in the US where owners of a corporation were held personally liable for any debt - including unpaid wages.
Good intent cannot circumvent the laws of the universe.
But, in general, companies must pay their employees for time worked. If the company runs out, then principals can be held liable.
That is only true if the company is a sole proprietorship or partnership structure where there is no corporate veil. Claims for wages due to insolvency do not fall under the Fair Labor Standards Act unless the principle willfully filed for bankruptcy in an attempt to avoid paying wages. Employees are considered creditors during a bankruptcy and may be paid according to their priority as a creditor but generally they will have no claim on the personal assets of the shareholders unless there was a personal guarantee of some sort or malfeasance.
Smaller company, wealthy principal, employees have a reasonable chance of getting paid, enforced by their state Department of Labor.
If the company folds then the assets of the company can be held to ensure payment but they are not likely to get paid except as a creditor of the company.
So that's how employees are different than investors, the "corporate veil" does not protect the company owner from liability for their wages.
That is NOT correct in the US unless there is evidence of malfeasance.
But since you really know what you're talking about, you should easily be able to back up your claims with an authoritative source. Please, show us all one single case in the US where owners of a corporation were held personally liable for any debt - including unpaid wages.
They can be if they signed a personal guarantee which is not unusual in small companies in need of financing. But if there is no personal guarantee of company debt then you are completely correct.
It's usually not that luck doesn't strike, because it generally does if you're doing something right. The problem is that you also tend to get struck by bad luck.
Based on the article I would guess that a random unexpected setback could easily have brought Tesla out of business in late 2008. Those sort of things happen all the time.
Successful people are those who are smart, hard-working and persistent
The point though is that there are a lot of UN-successful people with the same traits and less luck. Sometimes their luck isn't sufficient to give them the means to persist. The idea that unsuccessful people are invariably the architect of their own failure is toxic.
Generally, when applying for state IDs, you list officer personal information. States can, and will, go after officers for company debts unpaid. I've seen it happen.
Payroll is often met by taken loans. A $1.8bn contract from NASA would have presented sufficient collateral for Musk to get loans against.
Which is exactly what happened. Space-X was about to go bankrupt, with a success record of three failures and one success. NASA awarded them a contract to develop a new rocket for space station resupply, and guaranteed that they would be the anchor tenant for launches. That contract gave them the credibility to attract future funding.
This is an example of the system working right.
There is more than JUST luck, but luck is required. Most start by being born on 3rd base and go from there. The key is that the more you already have (often due to luck), the less luck you need to go up from there. At some point, being well known for being successful gives you an effective re-do button.
Nevertheless, in addition to a talent and a lot of work, Musk is OMFG lucky as well. Musk is one in about 6 billion people, someone had to get the lucky streak.
I don't see any evidence this is true. I know multimillionaires who didn't get any more or less lucky than average. The difference between them and me (definitely not a multimillionaire) is the spent their 20s and 30s living on someone's couch, working 20 hours a day, and failing over and over until they figured out what you need to do to start a successful business. Most successful businessmen have a few BKs under their belt, and it wouldn't have been surprising if Tesla had failed and Musk still ended up a billionaire.
It may be you have to get lucky to be Elon Musk rich, but I wouldn't bet money on it either.
Are you mad? Do you know how many businesses struggle with payroll? Where owners take loans (or are late paying other bills) in order to cover payroll. This is SOOOOO fu*king common. Start a business and see how often it happens to you.
Large companies routinely get short-term loans to meet payroll. As far as I can tell, that was a major reason for the idea that banks were judged too big to fail: if a bunch of banks had all gone under, immediately thereafter a large number of fortune 500 companies would also have gone under because they needed those banks for day-to-day financial obligations.
Nostalgia's not what it used to be.
They found that the random 'lucky' events weren't really so random. Usually the 'lucky' people worked hard to put themselves in the position for that lucky break to happen. While something like winning the lottery does take luck, you still have to put yourself in the position to have that chance at luck.
That is a bit of a red herring when trying to limit the role of luck in monumental success stories. No one really thinks they can win the lottery without buying a lottery ticket. And they don't think they can become a billionaire without having ownership stock in a company.
Some people simply understand that a large percentage of people who do take smart risks still end up failing regardless of their level of ability or persistence. Its likely even the majority of persistent and highly skilled entrepreneurs end up never succeeding. This is important for people to understand when they are deciding what risks to take in life.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
>we control how many throws of the dice we get. Successful people are those who are smart, hard-working and persistent
Which is, in fact, believe it or not the number one advantage of a solid social safety net. If you look at businesses - 80% fail in their first year. More importantly - looking at the successful ones the average owner of a successful business has had 3 failed businesses in the past (remember that's an average so for half of them it's twice that).
What this means is that entrepreneurship is an incredibly high risk investment one you can only make if you can afford to lose -repeatedly before you win. Without a social safety net, the only people who can afford that are the ones who are already rich (which is why so many of America's rich folk started with large chunks of inherited wealth. Gates had rich parents, Trump - in fact of the top 10 richest American business founders the only one who didn't have rich parents were Steve Jobs and that's only because he was adopted - his adoptive parents were not poor).
For everybody else - entrepreneurship is basically a near-guarantee of being destitute. If you'll be destitute after trying once, no way are you able to try enough times to get it right. It makes is almost impossible for somebody who is poor to ever be a successful entrepreneur.
But if you have a solid social safety net, you change the risk factor. Now - you can try a business, fail at a business, and not be destitute. You can fall back on the safety net, rebuild your capital and try again - you can be a successful entrepreneur without being rich BEFORE you start.
Unicode killed the ASCII-art *
I'm not entirely sure why this post is modded -1 other than it is from AC. In fact, I think that, although they are incompatible in some way, both AC and GP have said something incredibly valid.
I like the way that the GP described how the process by which people who have a single brilliant idea that nets them capital can work hard with that capital to leverage that into a larger enterprise. Although I'm sure he participates in VC activity, Musk did not simply take his money and "steal" from other's ideas by snookering inventors and founders into giving up huge equity stakes for a paltry amount of cash (albeit with very high risk). He took what he made and kept learning and then applied that to a venture that he did not think could succeed without someone willing to put some of their own hide into the game. Although there is a new article in HBR saying that Tesla is not really as "disruptive as you might think" link, I think that his work proved that you can have electric cars that people treat like cars and not buggies.
On the other hand, I definitely agree with the AC too. There is a significant amount of luck that contributes to whether or not someone's hard work simply keeps them alive (food on the table, shelter, medicine, etc) and whether their hard work nets them a huge payday. The sad part is that there are plenty of people whose hard work simply keeps them alive that, if freed from the Sisyphusian Task of looking out for their safety and survival, would improve the world in ways that we could not even imagine. We are awash in missed opportunities as a society because we waste so many people's intellect and talent by forcing them to deploy them in self defense against a system that wants them to fail.
I wish that we could have it both ways.
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So, look carefully around you. Know anyone who spent their 20s and 30s like that who isn't a millionaire? You probably do.
So if luck is one of the key factors that make people successful, Elon Musk has proven statistics and probability are a completely broken field.
Elon Musk is currently worth about $12 billion. There are about 100 people in the world with a net worth that high. Elon Musk may be more diversified in his businesses than most billionaires, but he is not unique.
And no one is saying it only takes luck to be successful, just that luck is a key factor. Perhaps even the most important factor in becoming a billionaire. That can't be said for becoming a millionaire, which almost anyone can do with just hard work and almost no luck (other than perhaps being born in the developed world).
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Put simply if Tesla had reached pay day and been unable to make the payment then it would have been insolvent and it would have been illegal for them to continue *to employ people*.
FTFY. Not being able to make payroll applies to public and non-public companies. Tesla became a public company in 2010 and Elon was discussing these pre-IPO events that occurred in 2008 before they were publicly trade-able.
Insolvent just means the company doesn't have access to enough free/unimpaired assets to operate legally, not that a company doesn't have enough assets (e.g., receivables, contracts, intellectual property, or business goodwill which are not liquid). If a company is bordering on insolvency, many companies choose massive equity dilution and/or a fire-sale of assets to recapitalize the company just to stay alive.
Of course *exchange listed* companies must be solvent or they become delisted, but generally not immediately the day it misses a payroll but after it declares bankruptcy. However, you can certainly trade ownership in unlisted and/or insolvent companies and they can also continue to operate in quasi-legal form. If they continue to operate they will build up lots of liability (including payroll liability) to the principals and directors during the time they operate and these liabilities may or may-not be shield-able during bankruptcy, so in this situation, generally the principals immediately file for bankruptcy protection and/or lay-off all employees to protect themselves.
However, in practice, even though not-paying employees is illegal, in most jurisdictions (like California) when you get a wage-judgement, there isn't such a thing as a wage-lien, so you generally need to sue to get your wages or wait for the bankruptcy settlement. Odds are pretty bad in both cases of ever seeing a dime if the principals of the company don't happen to have a pile of cash stashed in bank accounts (although having a principal like Elon might be an exception to these odds).
Why yes, I have sadly had direct experience with this :^(
So long and thanks for all of the fish.
That just strikes me as bad business.
I know it's common to "maximise the use of your money" and that a valuation can be based on some income to asset ratio which encourages debt, but when multi-million and billion dollar companies don't have actual cash to pay their staff they're doing it wrong.
Forget thrust, drag, lift and weight. Airplanes fly because of money.
Welcome to modern day big business. Its the build the barn doors after the cows come home approach.
Most people would be in for a real shock if they knew just how paycheck to paycheck most companies actually are.
Wow. I guess you figured the hole you're in wasn't deep enough, so you decided to keep digging.
Right back at you ;-)
FYI, there is no such thing as a state bankruptcy court, and state labor laws play no part in a bankruptcy proceeding. ALL bankruptcies in the US take place in a federal court, and are governed by federal law: [wikipedia.org]
Absolutely true. And completely irrelevant. The bankruptcy proceeding is about the disposition of the corporation's assets, and has absolutely no protections for personal liabilities under state labor laws or anti-fraud statutes.
Well it would be very surprising if of all places in the world it would be the USA who didn't have companies with limited liability. How did the US manage to get the biggest economy without the necessary financial tools like limited liability companies? Who would ever risk starting multi million projects when they will be be personally liable when the project fails?
Such companies are the keystones of a modern economy. There has never, ever been an empire or country or city state that had a thriving economy without companies with limited liability.
Empires that once were leading in science, commerce and culture, like the early Mohammedan Empire crumbled into the dark ages because extremist Islam theologians thought it was time to force the believers to live to the letter of the Quran and thus expelled businesses, making profit and lending money (no usury). The same happened before when extremist Christians destroyed the economy in the Roman Empire with the same biblical ideas.
And now here you are claiming that in the US some states hold owners personally liable for unpaid wages. Who would even invest on the stock market if this were true? I'm sure it would be the wet dream of some extremist Christian in the US. Maybe a group of 'new born' Christians might one day make such a naive move in their fatalistic idea that their bible is the absolute truth. But currently the US is still a country were the vast majority wants a working economy.
While something like winning the lottery does take luck, you still have to put yourself in the position to have that chance at luck.
You gotta be in it to win it; as the saying goes. Lot of people think my girlfriend is lucky, nope, she just enters a lot of competitions. Likewise the successful startup of businesses depend on the same kind of principle. There are very few people in the world who have a roaring success with their first business venture.
Note the key word was "first". A lot of successful people are those who've tried and tried again.
Absolutely true. And completely irrelevant. The bankruptcy proceeding is about the disposition of the corporation's assets, and has absolutely no protections for personal liabilities under state labor laws or anti-fraud statutes.
Once again, state labor laws have absolutely nothing, nada, zip, zilch to do with a bankruptcy proceeding. Repeating it over and over will not make it true, no matter how often you try.
If you believe your position is significantly more secure than an investor you are deluding yourself.
If a company is solvent it must pay its employees, but as a company goes bankrupt it will fail to do so. An attempt to retain employees with promises will ensue, but if it should fail you will usually get in line with the rest of their creditors. In some cases you will get priority over cash only creditors, but you should realize that the company has few assets at that point, and those will be leveraged, so your recovery is likely to be very small compared to what they owe you (a serious suggestion if you find yourself in this position is to TAKE THE DEAL THEY OFFER or negotiate something else immediately.)
Large companies with a good revenue stream are usually secure (until a startup destroys their revenue, which is nearly inevitable due to cost inflation in running a mature company, but takes quite a while.) Startups are mostly run on promises of success, but usually those promises go unfulfilled. When they are it means lots of money though, which is where it balances.
I will end this with much the same thought I started it with. You are not much more secure as an employee than an investor or officer, they just pay you better and you are not aware of how close it comes with great frequency. Knowing how close it comes is worth a lot of money as it turns out, as it is extremely high stress... and sometimes you put your own money in to keep it going for the moment.
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Once again, state labor laws have absolutely nothing, nada, zip, zilch to do with a bankruptcy proceeding. Repeating it over and over will not make it true, no matter how often you try.
Once again, principals' legal liability for wage theft HAS ABSOLUTELY NOTHING TO DO WITH BANKRUPTCY LAW. Bankruptcy for the CORPORATION deals with the disposition of the CORPORATION'S assets. It has nothing at all to do with personal assets, and how those personal assets might be attached in a suit for FRAUD.
I approve of what Elon Musk has done with his wealth.
I cannot say that for the vast majority of billionaires, and I could say the same of millionaires. My question is what do you think he should do? If you cannot come up with a better answer than he actually invested in...
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There is no reason to continue to upvote this... I have been at the karma cap for a long while, and at this point nobody is going to make this less than full score without a fuckton of sock puppets.
Save your mod points. No matter how awesome Elon Musk is and how eloquent I am in my drunken postings, it is not going over +5.
My genius self would take a pay cut to work for him on the basis of the advancement of the human race... but there is just no point in continuing to vote it up.
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Other than blind celebrity worship - I can see no basis for that assumption. Musk got to where he was precisely because he was lucky.
Musk fails to meet that criteria. He struck it rich, twice, right out of the gate. He never needed persistence.
Build a rocket and see it for yourself. If whatever size company is absolutely certain they meet all the obstacles and bad luck they might encounter on the road, then whatever they are doing is so common it's almost not worth doing. Something like manufacturing paper plates or plastic forks. Changing the course of human history for sure.
Don't know about US, but in Germany the sum of liabilities just had to be lower than the sum of the value of all assets. I it might happen that they don't have cash because they did not take credits to the maximum for whatever reasons.
I would be surprised if it is that the sum of liabilities had to be lower than value of assets. If you took a loan for $1 million and then bought equipment that equipment is immediately lower in value the second you bought it. This would mean you have a liability of 1 million and an asset worth say 700k. Which would run you afoul of what you described.
More likely it is that your available assets exceed current liabilities. Usually current liabilities are those that come due in this financial year.