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Musk not a person but a persona. Man behind business ventures

Elon Musk is a deity in Silicon Valley because he chose to commit himself utterly to improving our lives as citizens during an era when much of the Valley was chasing more trivial problems. Today, as the Regulatory Era dawns, there is perhaps no better role model for entrepreneurs around the world. He is sophisticated in his pursuit of the public interest and he isn’t afraid to do things his own way.

Musk’s companies—from PayPal to Tesla and SolarCity to SpaceX and Neuralink—operate in extraordinarily complex, regulated markets. Whether you’re trying to change the way money is exchanged or blast humans into the stars, you are going to have complex regulatory questions to answer. When you’re aiming to change the way we move about the world or developing new ways to power our daily lives or seeking to embed computer-connected chips into our brains, the public interest courses through every move you make, and with that, you’re going to have to work with—not around—governments. There’s no way to avoid it.

He launched a company that changed the way we purchase goods and services and share money with friends and family. Three years later, he launched another to design and build spacecraft that will soon ferry passengers to and from the International Space Station and may someday shuttle a colony of humans to Mars. Not two years after that, he helped found an electric car company that has been credited with fundamentally changing the automotive industry and the way we think about the future of sustainability and transportation.

Later, he unveiled designs for a tube-based, vacuum-sealed transportation system that many believe will change the way we move people and products from one place to another. His electric car company has morphed into a solar energy startup and has built some of the most revolutionary manufacturing plants on earth and developed battery systems that can power entire homes and businesses. He’ll soon be boring tunnels under cities so his tubes and cars can get you where you’re going without traffic. And his latest venture is pioneering implantable technology that will let our brains seamlessly and subconsciously communicate with computers.

And yet, for all of Elon Musk’s mind-bending breakthroughs over the past two decades, his most impressive and most important invention may be Elon Musk.

Not the person, that is, but the persona. Not the man, but the myth and mystique that surrounds him. When we hear his name, we don’t just think billionaire business tycoon, South African genius, or Silicon Valley inventor . . . we think world saver, superhero, Iron Man, or depending on your inclination, at least a megalomaniacal, evil genius. It’s that unique image that we have of Elon Musk, the narrative thread weaving through his entire career and stitching together each of his business ventures, that’s has been his most meaningful invention, because it’s the foundation that has made all of the others possible.

And it didn’t happen by accident.

Over the course of several decades, Musk has deliberately and audaciously cultivated a narrative of himself through years of carefully orchestrated media interviews and public appearances. His mystique grows with every new proclamation about the high speed at which we will one day travel through his Hyperloop transit system or the ever-shrinking number of years between present day and a manned shuttle landing on Mars.

He consistently talks less about the financial aims of his ventures, even flatly rejecting questions about it in a recent earnings call, than about the societal challenges they seek to solve. In other words, Musk has mastered selling the “why” behind his companies. When he talks about colonizing Mars with his space exploration company, SpaceX, he does so in the context of prolonging the history of our species.

What may set Musk apart, from a storytelling standpoint, is his uncanny ability to render far-fetched ideas in a way that’s totally plausible. In part, he does this by talking about the notion of, say, building an entire civilization as though it’s a simple math problem that needs to be worked out. As soon as we can hammer out the numbers, we can pack our bags: “In order to have a self-sustaining city on Mars—there would need to be millions of tons of equipment and probably millions of people. So how many launches is that? Well, if you send up one hundred people at a time, which is a lot to go on such a long journey, you would need to do ten thousand flights to get to a million people. So ten thousand flights, but over what period of time? Given that you can only really depart for Mars once every two years, that means you would need like forty or fifty years.”

Suddenly, we’re not talking about whether we’re going to Mars. We have moved beyond that. We’re talking about how long it will take to get there. Through the way he frames the narrative, he has moved us from if to when. “His greatest asset is his ability to take this big, big dream and make other people believe that it’s true,” Max Chafkin, a technology and business reporter who has profiled Musk on multiple occasions, said in an interview with Bloomberg a few years ago.

Why is that so important for Musk from a business standpoint? Because Musk is the ultimate regulatory hacker.

What does that mean?

Musk’s companies—from PayPal to Tesla and SolarCity to SpaceX and Neuralink—operate in extraordinarily complex, regulated markets. Whether you’re trying to change the way money is exchanged or blast humans into the stars, you are going to have complex regulatory questions to answer. When you’re aiming to change the way we move about the world or developing new ways to power our daily lives or seeking to embed computer-connected chips into our brains, the public interest courses through every move you make, and with that, you’re going to have to work with—not around—governments. There’s no way to avoid it.

It helps when every public official you encounter in every city around the world knows who you are when you come calling. It makes it even easier when every one of those officials believes that you’re genuinely trying to make life better for their citizens. Coupled with a track record of delivering success in the face of soul-crushing odds and a cacophony of naysayers renders it an especially powerful tool. That’s why the legend Musk is so unmistakably important to his success across all his business ventures. It’s all about his brand, and Musk has managed to transform his personal brand from that of a scrawny bookworm from South Africa to become the inspiration for Iron Man, Fortune magazine’s Business Person of the Year, and—as he was described in a best-selling biography—“a deity in Silicon Valley.”

Musk’s mastery of his personal narrative and the narrative surrounding his many companies stands out as an obvious regulatory hack, but the billionaire entrepreneur has actually used an entire arsenal of regulatory hacks. His strategic use of the media, for instance, extends well beyond his knack for building his own brand. He has become a master at leveraging the media to generate positive attention around each of his companies and pique the interest of investors, customers, and other key stakeholders.

Take for example Musk’s unveiling of SpaceX’s Dragon 2 spacecraft, in May 2014. Held inside a cavernous rocket factory just south of Los Angeles, packed with hundreds of reporters, investors and other Valley VIPs, it was described by one reporter as “an event worthy of a Hollywood premiere.” The press coming out of the event was a major victory. “The debut of this upgraded spacecraft is a very good sign for U.S space travel and couldn’t have come at a better time,” Vox concluded in a story about Dragon 2’s debut. Smithsonian Magazine’s headline declared: “SpaceX Will Soon Be Able to Send People to Space (Take That, Russia.).” Dozens of media outlets followed suit with similarly glowing headlines.

Nearly every new product or new development coming out of Musk’s companies over the last couple of years has been immediately met with a deluge of media coverage—effortlessly catching waves on topics like space and automobiles, but bolstered by smart public relations tactics that create positive stories about the companies at every turn.

Musk’s mastery of earned media has even allowed him to save money on paid media, according to some experts. “Tesla doesn’t really have to use traditional advertising because it is unique and the brand perception is so strong,” Robert Klara, Ad Week senior editor, said in an interview with Platform Magazine. “Tesla doesn’t need to take out a national TV ad because its market is people who already know about Tesla.”

Taking this truth to an almost absurd extreme, Musk held the media—tens of millions of people around the world—spellbound when he launched his personal Tesla Roadster into space on his staggeringly powerful Falcon Heavy Rocket, which has to rank as perhaps the coolest earned media hack of all time!

And even on the occasions where a piece of media coverage hasn’t gone his way, Musk has managed to use his owned media channels as a weapon. When The New York Times journalist John Broder penned a brutal review of the Tesla Model S, Musk and team investigated and discovered that many of the author’s claims about his experience with the car were either false or misleading. “Most people said, ‘It doesn’t matter if you’re right or wrong, you don’t go to battle with The New York Times,’” he said in an interview later. “I said, ‘To hell with that.’”

Musk published a data-rich article on Tesla’s blog titled “A Most Peculiar Test Drive,” in which he presented the facts and asked The New York Times to investigate. The Times’s public editor did just that and later acknowledged in a column “problems with precision and judgment” in the original article.

At this very moment, the media and followers around the world are held in rapt attention as to whether Musk will thwart his naysayers once again. Musk has used Twitter to give a daily countdown to the moment when the short-sellers betting against Tesla stock will have their bets against him blow up in their face. He may be right or wrong, but he has our attention.

Developing a compelling narrative, backing it up with data, and using it to generate and leverage earned and owned media is a killer combination when it comes to successful regulatory hacking. But there’s more.

Regulatory hackers benefit from being able to identify and take advantage of regulatory arbitrage opportunities—and even getting governments to compete for them. One illustrative example is Tesla’s quest to find the right home for a massive new “gigafactory.”

As Peter Elkind wrote in Fortune magazine, “Musk took a process that typically plays out behind the scenes and made it public. He played an Oz-like role as master orchestrator, sending signals through earnings calls and blog postings while keeping the states in the dark and playing on their fears of losing out. The combination of his strategy, the electric Musk factor, and the lure of 6,500 jobs inspired excited bidding among seven states and staggering leaps of faith.”

Musk ultimately secured a reported $1.4 billion in tax breaks, free land, and other benefits from Governor Brian Sandoval and the Nevada Legislature to build the factory near Reno. In the days that followed, Musk used his media prowess to defend the package in the press. “The $1.3 billion or so is the maximum tax incentive that Tesla could get over twenty years, so an average of, like, $50 or $60 million a year, is a tiny fraction of what this factory’s output will be,” he said in one interview. “It is not material to the economics of the factory.” Musk’s hack proved so effective that Jeff Bezos has stolen the script with “HQ2,” the very public competition among North American cities to be home to Amazon’s second headquarters.

Another tool in Musk’s regulatory hacking toolkit: grassroots activation. In 2014, Musk hired Jon Carson, a former campaign strategist for President Obama, to spearhead a multiyear grassroots campaign to place solar panels on every roof in the country. Carson would go on to lead SolarCity’s so-called ambassadors program, through which customers received a $250 credit when they referred a friend to sign up the company’s service. Because as Carson pointed out in an interview with Yale: “If you’re one of our solar ambassadors, and you help ten families in your neighborhood switch to clean power, that is real and impactful. And at the same time, you feel part of the movement. You feel that you’re part of these thousands of people moving in the same direction.”

Naturally, Musk and his team at SpaceX have also mastered selling to governments—currently, the only buyers on the market for trips to the International Space Station. To date, NASA has awarded twenty space station cargo-supply missions to SpaceX, with the agency representing the overwhelming majority of the company’s revenue over the past decade.

Musk’s empire has also become deeply familiar with lobbying – the ultimate regulatory hack for entrepreneurs with the means to engage in it. Over the eighteen-month period starting in January 2016, Tesla spent more than $100,000 on lobbying around issues related to electric vehicles and more than $450,000 overall shaping policies with the U.S. federal government, according to lobbying disclosure records. Tesla’s lobbying efforts included “discussions regarding electric vehicle manufacturing and sales policies and regulation,” as well as “discussions regarding issues impacting [electric vehicle] manufacturers regarding autonomous drive vehicles,” the documents show.

Over at SpaceX, a recent report published by the Sunlight Foundation, a group that tracks government spending, found that SpaceX has spent $4 million on lobbying Congress since Musk launched the company in 2002 and has dished out more than $800,000 in political contributions to congressional leaders on both sides of the aisle. Sunlight wrote, noting that Musk has personally donated about $725,000 to various campaigns over that same period. If you want to change the world, you need influence.

Elon Musk is a deity in Silicon Valley because he chose to commit himself utterly to improving our lives as citizens during an era when much of the Valley was chasing more trivial problems. Today, as the Regulatory Era dawns, there is perhaps no better role model for entrepreneurs around the world. He is sophisticated in his pursuit of the public interest and he isn’t afraid to do things his own way.

“I think people can choose to not be ordinary,” Musk said in an interview. “I think it’s possible for ordinary people to choose to be extraordinary.”

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