What's the quickest way to raise a few million dollars for your startup company? You might consider pitching VC firms, or creating a well-thought-out crowdfunding campaign, or even launching an initial coin offering (ICO). Or, if you're Elon Musk, you can just do it with flamethrowers and some clever social media.
Musk, best known as the founder of Tesla and SpaceX, has also launched The Boring Company, whose mission is to dig tunnels under traffic-clogged cities (such as his hometown of Los Angeles) where underground conveyer belts will whisk cars from one side of town to the other.
As always, the question was how to pay for this. So back in November, Musk began selling The Boring Company hats at $20 each. In December, he tweeted this:
To preserve the transcendent majesty & specialness of The Boring Company cap, we are capping cap orders at 50,000 caps. Almost there ... https://t.co/YqjEQAfy3u-- Elon Musk (@elonmusk) December 3, 2017
As one observer pointed out, 50,000 hats at $20 apiece comes out to $1 million, enough to push Musk's tunneling plans along a little bit without his having to give up any equity or control in the company.
At the time, Musk promised that if all 50,000 hats were sold, he'd start offering flamethrowers next. That was most likely inspired by the movie Spaceballs, the 1987 Star Wars parody of which Musk is a known fan. In that movie, proclaiming that the real money in movies comes from merchandising, one of the characters shows off T-shirts, lunchboxes, dolls, breakfast cereals--and a branded flamethrower, adding "The kids love this one!"
Many observers understandably assumed this was a joke--but no. Musk announced on Twitter yesterday that the Boring Company-branded flamethrowers were available for pre-order at $500 each (with extra for shipping and an optional add-on $30 fire extinguisher). He also posted a video of himself rushing at the camera with the flamethrower blazing on Instagram.
To make it even sillier, he tweeted this:
When the zombie apocalypse happens, you'll be glad you bought a flamethrower. Works against hordes of the undead or your money back!-- Elon Musk (@elonmusk) January 28, 2018
And then this:
You'd need millions of zombies for a so-called "apocalypse" anyway. Where would I even get a factory big enough to make so many!?-- Elon Musk (@elonmusk) January 28, 2018
And for good measure:
But wait, there's more: the flamethrower is sentient, its safe word is "cryptocurrency" and it comes with a free blockchain-- Elon Musk (@elonmusk) January 29, 2018
It worked. On Sunday, Musk tweeted that he had sold 7,000 of the flamethrowers. Do the math. That's $3.5 million in sales without even counting any fire extinguishers.
How did he do it?
Admittedly, the highly entertaining, extremely endearing, wildly ambitious, and always surprising Musk has something of a cult of personality. But how did he get thousands of people to shell out a fairly hefty sum for a glorified toy that they may never use?
First, by doing the unexpected. I'm guessing most of his Twitter followers thought Musk was being funny, and that he would never come out with a real flamethrower. Well, he was being funny, and the flamethrower itself is kind of funny. Visually, it's clearly modeled on the stormtroopers' guns in Star Wars. Practically--it isn't really a full-fledged flamethrower. According to Teslarati, the flamethrower appears to be "simply a propane torch fitted on what seems to be a modified CSI S.T.A.R. XR-5 Airsoft Rifle." As Musk said in his tweets, it will only shoot flame a short distance, not the 30 feet or so a real flamethrower could reach.
Second, by being approachable and transparent on social media, and by making it clear he takes none of this too seriously, Musk makes his fans feel like he's constantly inviting them into his fun, inventive world. They can feel they have a stake in his enchanting vision of a future where cars are no longer polluting, traffic jams are no longer an impediment, and people can live on Mars if they want to. Five hundred bucks is a silly amount to pay for a joke flamethrower that doesn't even throw flames very far, but a perfectly reasonable amount to pay for what feels like a piece of Musk's dream. If you can give your customers the sense that they're participating in your vision, and that that vision is a happy place to be, you can use this dynamic to your advantage as well.
Musk has tweeted that there are 20,000 flamethrowers for sale, and suggested that after they sell out, a freezegun might be next. We shouldn't have long to wait--at this rate, the flamethrowers will all be sold by Wednesday.