But SpaceX didn't fail. On September 28, 2008, Elon Musk's Falcon 1 rocket became the first privately funded spaceship to reach orbit from the ground. A grainy webcast shot from a camera mounted on the rocket showed the engine burning red above the blue Earth, while loud cheers from hundreds of employees echoed over the feed. In December, NASA announced that it had purchased 12 flights on Musk's new, larger rocket, the Falcon 9, to resupply cargo to the International Space Station; the contract was worth roughly $1.6 billion over seven years.
Musk made a similarly risky gamble to shore up Tesla. At a board meeting in October, with the company's future in doubt, Musk informed the board that he was raising a $40 million round from existing shareholders -- even if it meant that he would be the only shareholder putting in money. He eventually invested about $20 million in cash. "That was it," he says. "I was all in."
Musk's investors were floored. "I don't think I've ever seen an entrepreneur with so much resolve," says Steve Jurvetson. "That was a heroic act. It was a risky act. It saved the company." The gesture helped persuade Jurvetson and other Tesla shareholders to dig a little deeper. Kimbal Musk, Elon's brother and a board member at Tesla and SpaceX who contributed to the round, told me that it never occurred to him to advise his brother not to bet the remainder of his wealth on Tesla. "There was no question he was going to do it," says Kimbal. "Elon's psyche is so tied up in the idea of changing the world. His attitude was, So what if I don't have any money left?"
Musk's official titles at Tesla had been product architect and chairman, but as the largest shareholder, he had long been a de facto CEO. Now he took the title formally and announced that he would personally refund buyers' deposits if Tesla failed to produce a car. He also began aggressively campaigning to tap several hundred million dollars' worth of government-guaranteed loans that had been approved as part of the $7.5 billion Advanced Technology Vehicles Manufacturing Loan Program, a green-auto initiative that President George W. Bush signed into law just before leaving office.
The decision to apply for government funding was controversial, especially in the light of the financial crisis and the auto industry bailout. New York Times columnist Randall Stross wrote a scathing column in November in which he questioned whether it was appropriate for taxpayers to help out a sports car manufacturer and proposed the loan program be renamed the Bailout of Very, Very High-Net-Worth Individuals Who Invested in Tesla Motors Act. Musk had always been an enthusiastic patron of the press -- he accepts most interview requests, rarely seems to censor himself, and does not use a publicist -- but he took an especially aggressive tack in defending Tesla during the financial crisis. "Randy Stross is a huge douche bag and an idiot," he said in a video interview with Yahoo's finance website. (Musk stands by the assertion. In fact, when I asked him about it, he spent a few minutes parsing the difference between the two slurs and then he added another: "Renowned dickhead." I didn't ask for an explanation, but I'm sure he had one ready.)
Musk defended Tesla's application for the loan guarantee by pointing out that government dollars were already going to gas-guzzling carmakers. How, he asked, could anyone begrudge a tiny electric-car company a few million dollars when Washington was giving billions to General Motors and Chrysler? The argument worked. Tesla won approval for a $465 million loan, the chief source of financing for the Model S. (The big companies made out just fine. As part of the alternative-fuel program, Ford received $5.9 billion, and Nissan got $1.6 billion.)
The confrontational pose has since become Musk's default. During my visits, he made cracks about the astronaut (and vocal SpaceX opponent) Neil Armstrong, Audi, GM, BMW, Democrats, Republicans, the U.S. Senate, Lockheed Martin -- as well as a smattering of lesser villains that included enterprise software companies (useless, overpriced) and Santa Monica restaurateurs (purveyors of low-quality fare). These barbs can be quite funny -- and they make for excellent copy -- but Musk's tendency to publicly humiliate anyone who stands in his way can also be coercive and a little creepy.
On the other hand, Musk has little choice but to defend himself. He points out that his rivals in the auto and aerospace industries are among the most entrenched in the world. "The lobbying power they have is gigantic," he says. "They have literally buildings full of lobbyists in D.C. We have one guy. If this was something about who has the most lobbying power, we would be screwed." Musk has received plenty of government money -- and the Obama administration has embraced Tesla and SpaceX -- but suggestions by commentators that this is the result of some kind of quid pro quo arrangement seem off base. During the 2008 election, Musk, a registered Independent, contributed more money to Republicans than Democrats. He gave $2,300 to the Obama campaign.
