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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.
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...
> affordable battery packs
Not yet they aren't.
Your hair look like poop, Bob! - Wanker.
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.
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
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.
"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.
soon they will recombine and give us affordable rocket packs.
Paying taxes to buy civilization is like paying a hooker to buy love.
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
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.
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".
I'm a signature virus. Please copy me to your signature so I can replicate.
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
>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.
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