by Peter Diamandis: Elon Musk’s entrepreneurial success is a direct result of his mindset, strategies, and intelligence…
Having known Elon for 20 years, I’ve had the opportunity to watch his meteoric rise into someone who is arguably the greatest entrepreneur of our age.
In this blog, I’ll summarize what every exponential entrepreneur can learn and emulate from Elon’s core success tactics and strategies.
I’ve divided these lessons into 6 sections:
- Deep-rooted Passion
- Massively Transformative Purpose
- Singular, Unwavering Focus
- First Principles Thinking
- Thinking in Probabilities
- Not Settling for “No” / Not Giving Up
Let’s dive in…
1. DEEP-ROOTED PASSION
“I didn’t go into the rocket business, the car business, or the solar business thinking, ‘This is a great opportunity.’ I just thought, in order to make a difference, something needed to be done. I wanted to create something substantially better than what came before.” – Elon Musk
Elon only tackles those problems where he has deep-rooted passion and conviction.
After selling PayPal, with $165M in his pocket, he set out to pursue three Moonshots, and subsequently built three multibillion-dollar companies: SpaceX, Tesla, and SolarCity.
This passion (and the underlying emotional drive) allowed him to push forward through extraordinarily difficult times and take big risks.
You might think it was always easy for Elon, but back in 2008 he was at a lowest low: SpaceX had just experienced its third consecutive failure of the Falcon-1 launch vehicle, Tesla was out of money, SolarCity was not getting financed, and Musk was going through a divorce.
He had to borrow money for basic living. Traumatic times.
Despite the 2008 economic crisis at the time, he bet every penny he had, and eventually everything turned around. Going from being in debt, to the wealthiest person on the planet just 13 years later. Wow, what a journey!
Ultimately, it was his passion, refusal to give up, and drive that allowed him to ultimately succeed and begin to impact the world at a significant scale.
2. CLEAR MASSIVELY TRANSFORMATIVE PURPOSE(S)
Part of Elon’s ability to motivate his teams to do great things is his crystal-clear Massively Transformative Purpose (MTP), which drives each of his companies.
As I always say, social movements, rapidly growing organizations, and remarkable breakthroughs in science and technology are all backed by a powerful MTP.
Elon’s MTP for Tesla and SolarCity is to accelerate the world’s transition to sustainable energy.
To this end, every product Tesla brings to market is focused on this vision and backed by a Master Plan he wrote nearly 15 years ago.
Elon’s MTP for SpaceX is to backup the biosphere by making humanity a multi-planet species.
Elon has been preaching this since the founding of SpaceX back in 2002, even when he was experiencing numerous rocket failures.
“I think fundamentally the future is vastly more exciting and interesting if we’re a spacefaring civilization and a multi-planet species than if we’re or not. You want to be inspired by things. You want to wake up in the morning and think the future is going to be great. And that’s what being a spacefaring civilization is all about.” – Elon Musk
MTPs are like a north star for any exponential entrepreneur and their employees.
They keep all efforts focused and aligned, which helps his organizations grow cohesively even in times of chaos.
And when you combine passion and purpose, that gives you something else…
3. SINGULAR, UNWAVERING FOCUS
Elon is notorious for working 75 – 80 hour weeks, especially in the early days of SpaceX and Tesla.
There were times during Tesla’s early days where a specific problem needed to be solved, so he would sleep under his desk or on the factory floor if he had to. Elon didn’t think about anything else—all he focused on was the task at hand.
And now look at Tesla: it’s a giant transforming the automotive world.
Passion, purpose, and focus. All of these put you into what psychologists call a flow state: a highly enjoyable and meaningful state where work ceases to become work and instead becomes energizing and immersive.
This intensity that Elon brings is different from the kind of intensity that burns people out or causes them to quit jobs. For him, the intensity is energizing—not draining.
4. FIRST PRINCIPLES THINKING
First principles thinking is a mode of inquiry borrowed from physics that is designed to relentlessly pursue the foundations of any given problem from fundamental truths.
Elon has deployed this thinking strategy to give himself an unfair advantage when developing new batteries, a key component for both Tesla and SolarCity.
Here is Elon describing first principles thinking in an interview with Kevin Rose:
“I think it is important to reason from first principles rather than by analogy. The normal way we conduct our lives is we reason by analogy. [When reasoning by analogy] we are doing this because it’s like something else that was done or it is like what other people are doing — slight iterations on a theme.
First principles is kind of a physics way of looking at the world. You boil things down to the most fundamental truths and say, “What are we sure is true?” … and then reason up from there.
Somebody could say, “Battery packs are really expensive and that’s just the way they will always be… Historically, it has cost $600 per kilowatt hour. It’s not going to be much better than that in the future.”
With first principles, you say, “What are the material constituents of the batteries? What is the stock market value of the material constituents?”
It’s got cobalt, nickel, aluminum, carbon, some polymers for separation and a sealed can. Break that down on a material basis and say, “If we bought that on the London Metal Exchange what would each of those things cost?”
It’s like $80 per kilowatt hour. So clearly you just need to think of clever ways to take those materials and combine them into the shape of a battery cell and you can have batteries that are much, much cheaper than anyone realizes.”
First principles thinking works so well because it gives us a proven strategy for editing out complexity and allows entrepreneurs to sidestep the tide of popular opinion.
5. THINKING IN PROBABILITIES
Elon is always trying to broaden his view by thinking in probabilities.
“Outcomes are usually not deterministic … they’re probabilistic. But we don’t think that way. The popular definition of insanity—doing the same thing over and over and expecting a different result—that’s only true in a highly deterministic situation. If you have a probabilistic situation, which most situations are, then if you do the same thing twice, it can be quite reasonable to expect a different result.” – Elon Musk
This difference is key.
Thinking in probabilities—this business has a 60 percent chance of success—rather than deterministically—if I do A and B, then C will definitely happen—doesn’t just guard against oversimplification. It also protects us against the brain’s inherent laziness.
The brain is an energy hog (it’s 2 percent of our body mass yet uses 25 percent of our energy), so it’s always trying to conserve. As it’s way more energy efficient to think in black and white, we often do.
But outcomes exist across a range.
As Elon puts it, “The future is not certain. It’s really a set of branching probability streams.”
How he chooses which streams to explore depends on the relationship between those probabilities and the importance of his objective.
“Even if the probability for success is fairly low, if the objective is really important, it’s still worth doing. Conversely, if the objective is less important, then the probability needs to be much greater. How I decide which projects to take on depends on probability multiplied by the importance of the objective.”
SpaceX and Tesla are great examples. When Musk started both companies, he thought their probability of success was less than 50 percent—probably a fair bit less than 50 percent.
But as Elon points out, “I also thought these were things that needed to get done. So even if the money was lost, it was still worth trying.”
6. NOT SETTLING FOR “NO” / NOT GIVING UP
I’ve always said that “No” simply means begin one level higher. Or as Martine Rothblatt, another great exponential entrepreneur puts it, “Every no is just a step closer to yes.”
Elon’s first wife tells an anecdote about him from his college days. He received a 98% one of his tests, but he wasn’t satisfied. So Elon went to his professor and got them to change the grade to a 100%.
Most people might think this is a waste of time: 98% is a perfectly respectable grade.
But Elon is not like most people.
He didn’t take “No” for an answer.
And when SpaceX was started and was building their first rocket, Falcon-1, Elon had expected early failure, budgeting for 3 flights. But when his 3rd launch attempt failed, he did whatever it took, including borrowing money and going into debt, to get to a 4th, and ultimately successful flight of the Falcon-1.
When you are driven by deep passion and conviction with a singular unwavering purpose, it is incredible what you can ultimately achieve.
CLOSING THOUGHTS
These 6 strategies from Elon have contributed to his massive success as an exponential entrepreneur. They reinforce that your mindset is the most important resource you have to achieve your grandest dreams.
Ultimately, for you to make a difference in your business and the world, if you’re not absolutely passionate and driven by that purpose, you will not take risks when you need to, and you will not keep going in the face of seemingly insurmountable obstacles.
What mindset have you chosen to develop? What mindset are you utilizing to overcome hardship, to inspire your team and to attract the capital and resources required?
My belief is that as entrepreneurs we need to carefully choose our mindsets, and surround ourselves the colleagues and data that reinforce those mindsets, every day and throughout the year.
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If you want to become an exponential entrepreneur and reinforce those mindsets that will inspire and guide you to create a hopeful, compelling and abundant future for yourself and humanity, then consider joining my year-round Abundance360 coaching program.
Every year, my team and I select a group of 360 entrepreneurs and CEOs to coach over the course of a year-long program. You can join at any time for a full year’s worth of personal coaching on Exponential Tech, Longevity, Moonshots, and Abundance thinking.
My mission is to help A360 members obtain mastery in four specific mindsets: an Abundance Mindset; an Exponential Mindset; a Moonshot Mindset; and a Longevity Mindset. Together we will actively select and reinforce your preferred Mindsets.
