Did Elon Musk build his fortune on a family legacy? – Liberation

 Did Elon Musk build his fortune on a family legacy?  – Liberation

The origin of the wealth of the boss of Tesla, SpaceX and perhaps soon of Twitter arouses fantasies and rumors.
Question asked by Annick, on April 27, 2022,

Elon Musk created a surprise on Monday, April 25, by obtaining the agreement of the board of directors of Twitter for the acquisition, at 54.20 dollars per share, of the social network, thus valuing the company at around 44 billion. of dollars. If some doubt that the operation will go to completion, this extraordinary raid on one of the most influential social networks in the world gives an idea of ​​the extent of the wealth (and network) of this native billionaire. ‘South Africa. In just two years, from 2020 to 2022, Elon Musk’s fortune has grown from $26.4 billion to $219 billion, according to Forbes, which ranks him at the top of the richest people on the planet. A fortune essentially composed of shares of his two companies: SpaceX and Tesla. Another distinction granted by the American economic magazine to Musk, a self-made scoreof 8/10, considering that he built his fortune himself.

On social networks, however, Internet users regularly relay a rumor according to which the billionaire would have in fact inherited his fortune from his father, owner of an emerald mine (or diamonds depending on the version). Its Wikipedia entry thus indicates that “he is the son of Errol Musk, a wealthy South African engineer and property developer of Afrikaner and Anglo-South African origins, who became co-owner of an emerald mine in Zambia, and Maye Haldeman, a Canadian nutritionist and model“. The online encyclopedia is based on a 2018 article by the Business Insider.His father, Errol Musk, had a casual attitude towards the family’s considerable wealth, including stones from the Zambian emerald mine in which Errol owned a half share.“, can we read.

The rumor of an emerald mine

The article then recounts an episode where the young Elon Musk, aged around 16, had decided to sell two emeralds to the jeweler Tiffany, during one of the many trips organized by his father. But this anecdote could not be confirmed by the journalist, who explains that he joined Elon Musk on this subject without success. And to indicate that “father and son have a complicated history“. In another article in the South African edition of the news site, Errol Musk had told how he had obtained co-ownership of an emerald mine in Zambia, bought from Italians during an improvised stopover in Djibouti. On Facebook, he had reacted to the publication of the article, explaining in particular that he no longer received income from this mine and that his involvement in this company “did not help Elon’s success in the United States“. On Twitter, Elon Musk was annoyed several times by this rumor. “I don’t have an ’emerald mine’, and I haven’t received any free money from anyone, whether as an inheritance or otherwise”he had for example replied, on January 4, 2020.

Still, the 50-year-old entrepreneur comes from a very established white South African family. “The Musk clan has been present in the country for around two centuries; it was listed in the first Pretoria telephone directory“, we learn in the reference biography written by the journalist Ashlee Vance, in 2015 (Tesla, Paypal, SpaceX: the entrepreneur who will change the world, published by Editions Eyrolles). It should be noted that there is no reference to the possible purchase of the mine, nor to its profits, in this work.

While Elon Musk is still a child, the father runs a lucrative engineering business, allowing the family to settle ‘in one of the grandest houses in Pretoria’. These comfortable conditions notably allowed early access to computers and travel. At 12, says the biographer, “a South African professional newspaper, PC and Office Technology, published the source code of a video game created by him. It was a space game called Blaster and inspired by science fiction. […] The article earned him $500 and gave his first look at his character“.

A donation of $28,000

At 17, the young man left for Canada, where he had family ties. “En disagreement, his father cut off his food“, according to Le Figaro. In a tweet published in 2021, responding to a rumor about the origin of his fortune in connection with apartheid, Elon Musk indicates that he arrived with 2,500 Canadian dollars in his pocket. “I paid for my studies myself, and I ended up with a debt of about 100,000 dollars”he adds.

After two internships in Silicon Valley, Elon Musk and his brother Kimbal founded, in 1995, Global Link Information Network, a start-up then renamed Zip2. “The Musk brothers hoped to convince restaurants, clothing stores, hairdressers, etc., that the time had come to make themselves known to Internet users. Zip2 would create a business directory linked to geographical maps», describes Ashlee Vance. Launching the business in a “office six by nine meters”, in Palo Alto, Calif., is done with little money, according to Vance’s account. However, and contrary to what the now boss of Space X claims on Twitter, their father did contribute to the launch of the affair (certainly more modestly than the rumors suggest). “Errol Musk gave his sons $28,000 to help them but they found themselves pretty much penniless after renting their premises and buying software and equipment“, can we read in the biography.

The two brothers raised their bet and the successful company was bought in 1999 by Compaq Computer for 307 million dollars. With this sale, Elon Musk pockets 22 million dollars, thus reaching, at 27, the rank of multimillionaire. In the process, he invests, still according to Vance, 12 million in the foundation of X. com, a new online banking company – a revolutionary concept for its time. In 2000, X.com absorbed its competitor Confinity, the founder of the online payment service PayPal. In July 2002, X. com, renamed PayPal in the meantime, was acquired by eBay for 1.5 billion dollars. Elon Musk, who decided at the same time to launch his own space company, SpaceX, “pocketed about $250 million, or $180 million after tax – enough to make his wildest dreams come trueconcludes Ashlee Vance.