UK Columnist Warns vs 'Genius Entrepreneurs' Like Elon Musk

Trussonomics trashed within eight weeks. Donald Trump’s anointed candidates cut down in the US midterms. Sam Bankman-Fried, the poster boy of the crypto world, collapsing into bankruptcy. Elon Musk throwing Twitter into turmoil. Theranos founder Elizabeth Holmes in jail. The bursting of myths and the shredding of reputations seem to be the themes of the day, Kenan Malik wrote for The Guardian.

Photo Insert: Theranos founder Elizabeth Holmes, who was featured in publications like Vanity Fair, graced the cover of Fortune, and even met then-Vice President Joe Biden, turned out to be a fraudster.

Each of these cases is, of course, distinct and the root causes of each disaster different. There is a danger, too, in discussing these developments, of seeming to revel in failure. Too much of the debate about Musk and Twitter, especially, has mixed despair with schadenfreude.

“His brilliance, his vision, and the breadth of his ambition make him the one-man embodiment of the future,” fawned Fortune magazine in 2014. Look closely at Musk’s record and the mystique begins to vanish.

Musk was removed as CEO of each of the first companies he helped found: Zip2, an online business directory; X.com, an online bank; and PayPal, created by the merger of X.com with its much more successful competitor Confinity, co-founded by another Silicon Valley wannabe, Peter Thiel.

Nevertheless, the sale of Zip2 netted Musk $22 million (£18.5 million), and the acquisition of PayPal by eBay $176 million.

He used that money to set up a series of other ventures, most notably the electric car company Tesla and SpaceX, which manufactures and launches spacecraft. Yet his record here, too, is hardly that of an entrepreneurial genius.

Tesla is today the world’s most valuable car company. It has, however, been plagued by a host of major problems, from fatal crashes to fines for alleged fraud to accusations of creative accounting.

Tesla has also been accused of garnering more than $295 million in green subsidies from the state of California for a battery-swapping technology that was never made available to customers.

SpaceX nearly folded in 2008 before a last-minute $1.6 billion contract from NASA. Before that contract, Musk acknowledges, “we were running on fumes.” His projects were so reliant on public money for survival that in the days before he discovered the necessity of voting Republican to provide “balance” to American politics, conservatives derided the degree of state support for his ventures.

The icon of the self-made entrepreneur of genius has survived only because of fabulous state subsidies. Nor is it just public money that Musk arrogates.

According to his biographer Ashlee Vance, Musk constantly appropriates for himself the credit for the work of his engineers and programmers. “I don’t really have a business plan,” he has boasted, never letting, in the words of Vance, “the fact that he knew very little about [an] industry’s nuances bother him.”

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