How Elon Musk Actually Became the Richest Man in the World

To the surprise of absolutely no one, online retail giant Amazon has positively thrived during the recent pandemic, making its owner, multi-billionaire Jeff Bezos, even more wealthy than ever before. And he was plenty rich before the pandemic hit. And yet, despite record-breaking success for Amazon in 2020, by early January 2021, Bezos had been shockingly ousted from the top spot on the Forbes list of the world's richest people. And the financial world was shocked by how Elon Musk became the richest person in the world. Elon Musk's climb to the top is a fascinating story, because it might just be the fastest rise in wealth creation in all of history. In March 2020, less than one year before he was crowned the world's richest, Musk had a net worth of only $27 billion, and had just barely cracked Bloomberg's list of the world's top 50 richest people. In just nine short months, Musk added more than $165 billion to his net worth to claim the top spot among the world's richest billionaires. By November 2020, Musk had climbed all the way to the top five richest people in the world, and that's when his rise to the top started in earnest. Within a month, Musk overtook both Facebook creator Mark Zuckerberg and Microsoft's Bill Gates to become the third richest person in the world. In December 2020, he passed French tycoon Bernard Arnault to take the number two spot. That left Musk behind only Jeff Bezos and Amazon, who were seemingly untouchable coming off of a record year in 2020 thanks to a surge in business generated by the pandemic. But to the shock of the financial world, Musk did the impossible. In early January 2021, Musk's net worth surged to $190 billion, nearly $5 billion ahead of Bezos. So how did he do it? How did Elon Musk rise through the ranks of the world's billionaires and tycoons to become the world's richest person in less than a year? Well, that might be best illustrated by his response to the news that he had hit number one. Musk replied to a tweet that announced his ascension to the number one spot by saying simply, how strange, well, back to work. Indeed, hard work has been the key to Musk's impressive success. While his rise to the top may have seemed to happen overnight, the truth is that Musk has been working toward this moment his entire life, putting his heart and soul into every project he undertakes. Musk's electric car company Tesla was launched in 2003, but only turned its first profit in 2020. In 2018, when Tesla was plagued by production delays, Musk told reporters that he was back to sleeping at the factory, dedicating his every waking hour to getting things back on track. Without that kind of intense focus and work ethic, Musk would never have been able to rise through the ranks of the world's wealthiest. Of course, such an incredible and rapid rise to the top of the world's wealthiest people doesn't come without controversy. Musk has been accused of being complicit in the deaths of child laborers in the Democratic Republic of Congo, where children are forced to work in brutal conditions to mine cobalt, a valuable and essential material required for manufacturing computers. Tesla workers have also spoken out against Musk's hardline stance against unions, claiming that any pro-union activities within his factories are swiftly shut down. Hard work may be Musk's secret to success, but that success hasn't come without a healthy dose of ruthlessness and controversy, too. It is an inescapable economic truth that you'll never truly get wealthy by working for someone else. Entrepreneurship is the only path to becoming one of the world's richest people. Every billionaire that Musk passed on his way to the top, from Gates to Zuckerberg to Warren Buffett and even Jeff Bezos, every one of them got where they are by building extremely profitable and scalable businesses, and Elon Musk is no exception. Innovation and entrepreneurship seem to be in Elon Musk's DNA, though being born into a wealthy South African family certainly didn't hurt. He first discovered his love of computers and technology at the age of ten, and after teaching himself to code, launched his business career at age twelve when he sold his first software, a computer game called Blastar. At seventeen, he moved to Canada to attend Queen's University and to avoid the mandatory military service in his home country of South Africa. As his mother was Canadian, Musk obtained his Canadian citizenship that same year, but he already had his sights set on the future. He figured Canadian citizenship would be a stepping stone to hitting his ultimate goal, U.S. citizenship. Three years later, Musk fulfilled his dream and moved to the U.S. to attend the University of Pennsylvania, where he earned two bachelor's degrees in economics and physics. His next step was the prestigious Stanford University, where he enrolled in a Ph.D. program in energy physics, but the boy genius would last just two days at Stanford before dropping out. His arrival in California had coincided with the internet boom, and Musk and his brother Kimball took a huge gamble. Leaving behind the world of higher education and launching their first startup company, online city directory Zip2, Musk's paid off big time. Through hard work and tireless effort, Musk had built a hugely popular and profitable business, and in 1999 Musk sold Zip2 to Compaq for the astonishing price of $307 million, plus more than $30 million in stock options. But rather than sit back and enjoy success, Musk showed the first glimpses of the uncanny business acumen that would later help him climb the list of the world's wealthiest people. He immediately turned around and invested the sale of his first company to fund his next venture, X.com, an online payment platform that would later become PayPal. 2002 was a banner year for Musk. He fulfilled one of his life's goals when he became a US citizen, and he also earned his first billion at age 30 when he sold PayPal to eBay for $1.5 billion. But Musk was not done. Far from it. Finally, he had the money to go after his true lifelong dream. As Musk explains in a tweet pinned to the top of his Twitter profile, about half my money is intended to help problems on Earth and half to help establish a self-sustaining city on Mars to ensure continuation of life of all species in case Earth gets hit by a meteor like the dinosaurs or World War III happens and we destroy ourselves. The sincerity of Musk's desire to solve the world's problems may be dubious at best. The billionaire has been accused of hoarding his wealth rather than using it to make a tangible difference in the world. But with that ambitious goal in mind and the proceeds of his latest sale in his pocket, Musk went on to launch two companies that certainly changed the world as we know it, and would eventually propel him to the top of the list of the world's richest people. Musk created SpaceX in 2003 to build spacecraft for commercial travel. It may have been a far-fetched dream at the time, but by 2008 he had successfully secured contracts with NASA to supply cargo to the International Space Station. In 2012, he made history when SpaceX launched the first unmanned Falcon 9 rocket on a resupply mission to the ISS, marking the first time that a private company had sent a spacecraft to the space station. Musk eventually plans to use SpaceX to shuttle astronauts to the ISS as NASA moves away from using its own craft, but his focus is always on the ultimate long-term goal of colonizing Mars. SpaceX may be a revolutionary success story, but the real secret to Musk's success, at least as far as his position of richest person in the world is concerned, is Tesla. Musk also launched Tesla in 2003 using funds from the PayPal sale, and at the time his ambitions for the electric car company seemed as outrageous as his plans to colonize Mars. Musk wanted to take on the giants of the auto industry with affordable, mass-market electric cars, an idea that seemed ludicrous in the early 2000s. Against all odds, Musk's hard work once again paid off, and Tesla's surprising success paved the way for Musk to enter the exclusive realm of the world's richest and wealthiest people. By 2017, Tesla had overtaken General Motors to become the most valuable carmaker in the US, and Tesla's all-electric sports car, the Roadster, is said to be one of the fastest production cars ever made. But things really kicked up a notch in 2020, pushing Musk over the edge to become the world's wealthiest person. Tesla's share price skyrocketed in 2020, increasing by a staggering 720% in that year alone. In the first few weeks of 2021, the stock climbed another 20%, giving Musk the final push he needed to crack the top spot on the list of the world's richest. Tesla is now valued at more than $700 billion, more than Toyota, Volkswagen, Hyundai, General Motors, and Ford combined. Musk's unmatched work ethic and his forward thinking, as well as his ruthlessness, have certainly played a key role in the rise of Tesla's stock. But Musk was helped along in his journey to becoming the richest person in the world by some factors that were entirely outside of his control. For one thing, despite Musk's surprising ties to Trump early in his presidency, the recent US election results might have prompted renewed faith in the future of the electric car industry in general, as Democrats are generally seen as more friendly to green agendas with things like tax credits for consumers who buy electric vehicles. Surprisingly, the pandemic might have also helped Tesla and Musk reach new heights. According to the Institute for Policy Studies, the 500 richest people in the world increased their combined wealth by a stunning $1.8 trillion in 2020, and the US's 651 homegrown billionaires alone grew their wealth by more than $1 trillion over just nine months. It's clear that the pandemic provided a healthy boost to all of the ultra-rich, but perhaps none so much as Amazon's Jeff Bezos. Still, despite a record shattering year for Amazon in 2020, some key events in the life of CEO Jeff Bezos played a huge role in allowing Elon Musk to bypass him to become the world's richest person. Not only did he lose some of his stake in Amazon in his divorce settlement, handing over 4% of his shares to his ex-wife Mackenzie Scott, but he also donated shares worth more than $680 million through his Bezos Earth Fund in November of 2020. Those losses added up to a big drop in Bezos' net worth, and might have been as much to blame for Musk passing Bezos in the list of the world's richest people as anything Musk himself did. By the way, how does the richest person in the world spend their money? Probably not the way we'd expect. When Musk first started his climb up the ladder of the world's richest people, he certainly went on a buying spree, snapping up over $100 million worth of prime California real estate, including a $17 million, 1.67-acre estate complete with a two-story library, a private gym, a personal home theater, and a thousand-bottle wine cellar. However, in 2020, Musk started to sell off his properties, telling reporters that he planned to eventually own no home. And it's not just real estate that the billionaire plans to get rid of. In 2012, Musk signed the Giving Pledge, vowing to give away and donate the majority of his wealth during his lifetime, though he's yet to live up to this promise. At the head of one of the world's most innovative auto companies, perhaps it's not surprising that Musk has an affinity for cars. He purchased a Lotus Esprit submarine car from a James Bond movie at auction for $920,000. He also owns a Ford Model T and a Jaguar E-Type Series 1 Roadster, both gas-powered. But other than a taste for fine cars, Musk insists that he's simply too busy to live a lavish lifestyle. He's told reporters that he frequently works 120-hour weeks, and that he's only taken a total of two weeks off in the last 12 years since he founded Tesla. He even spent his 48th birthday in 2019 at Tesla working on global logistics for the company. Musk definitely doesn't live like a typical billionaire. He says he enjoys inexpensive hobbies like playing video games, listening to music and reading, and spending time with his kids and his friends. But, he says, whenever he has any free time, it's usually work more. Through hard work and laser-like focus, and with a generous helping of luck, Elon Musk managed to do the impossible once again, surpassing Amazon CEO Jeff Bezos to become the richest person in the world as of January 2021. In the cutthroat world of business, only time will tell whether Musk will be able to hang on to the top spot. Musk was right on point when he tweeted, Back to work, in response to the news that he was the world's richest person. Tesla is still a relatively new company, and it only turned its first profit in 2020. Musk's recent ascension to the top of the list of the world's richest people has only put more pressure on the billionaire innovator to prove that Tesla can live up to expectations and become more profitable than the entire motor industry combined in order to justify its current valuation, which is the cornerstone of Musk's net worth. No matter how Elon Musk became the richest person in the world, and regardless of whether he stays at the top, we're sure to see some interesting things from Musk and Tesla in the future. If you thought this video was fascinating, you'll definitely want to be sure and check out our other videos like this one called Elon Musk vs The Average American, How Do They Compare? Or maybe you'll like this other video instead.