The term billionaire has become “pejorative”, Elon Musk said on the Joe Rogan Experience podcast in May.
At that point, the stock price of Tesla, his electric car company, was up 81pc since the start of the year in the midst of a pandemic that has seen world economies battered, high streets shuttered and office workers sent home.
Today, it's up 326pc to $1,907 since January 1, placing 49-year-old Musk among a number of billionaires that have seen their net worth soar in the past year. During lockdown, Musk's wealth has tripled to $90.3bn (£68.5bn).
He isn't the only one. Jeff Bezos has seen his wealth rise by $80bn to $195bn as Amazon became a crutch for much of Western society during lockdown. Similarly, Eric Yuan the founder of video-conferencing software Zoom added $10.4bn to his wealth, according to the Bloomberg Billionaires Index. Meanwhile, Mark Zuckerberg has seen his wealth rise $21bn to $99.4bn.
But despite the surges among the world’s richest, it is that of Musk that is the most eye-catching.
“The share price is ridiculous when you compare it to other car manufacturers and especially if you look at the volume of vehicles that Tesla delivers versus someone like Ford or Toyota,” says policy manager at Access Partnership Tiernan Kenny.
It was just last month that Tesla overtook Toyota as the world’s most-valuable car brand, but already that looks to be a distant landmark in the rearview mirror.
Tesla sold 367,500 units last year, a record for the company, by comparison Toyota shipped a hefty 10.74m vehicles. Despite this, on July 1, Tesla shares hit $1,134 pushing its valuation to $209.47bn, $4bn more than that of Toyota.
Since then, Tesla’s market capitalisation has risen to $351bn.
The unrelenting surge of Tesla's stock has made Musk (who has admitted in the past he feels it is overvalued) the world’s fourth wealthiest man.
The tremendous year for Tesla stock has seen his fortune overtake the likes of luxury retailer LVMH’s Bernard Arnault and Indian business magnate Mukesh Ambani. Only Bezos, Bill Gates, and Mark Zuckerberg are worth more than him according to Bloomberg.
Tesla stock price is too high imo
— Elon Musk (@elonmusk) May 1, 2020
Climbing any further will be even more challenging for one of the world’s most-famous businessmen.
“To be honest, I think it will be difficult for Elon to overtake Zuckerberg because Tesla’s share price run recently has been exceptionally bullish, even by Tesla’s standards,” says David Madden, an analyst at CMC Markets.
“We would need to see a further jump in demand projections from the carmaker, and at the same time we would probably need to see a negative Facebook story to weigh on the share price.”
Madden says any such story is unlikely and that the social media giant had largely fended off the ‘BoycottFacebook’ campaign.
Tesla’s surge has confounded some analysts who cannot tie the company’s fundamentals to its share price.
Musk is currently paid through a long-term incentive plan that is linked to the company’s revenue and valuation.
The first tranche was made available to him after the company posted revenue of more than $20bn and held a valuation of more than $100bn for a year. Meeting the first tranche of his unprecedented payment plan within two years shocked many investors and stock watchers.
“I've seen some people say that part of the increase in the share price is from people who are using stock trading apps who are just kind of buying brands they kind of like, without really understanding the fundamentals that go underneath it,” says Kenny.
“It's obviously going kind of quite well for him, especially compared to a few years ago where they're having big problems with the production lines in the factories.
“But the real question is, at some stage are they going to kind of push themselves too far and end up kind of imploding the share price?”
Some had suggested that the company could even go bankrupt at a time when a number of public contributions from Musk shook confidence.
For one he was lambasted for suggesting he had secured funding to take the company private when he had not. He was also embroiled in a messy battle with a diver who helped rescue a junior football team that was stuck in a cave in Thailand in 2018.
But the past 12 months have been unrelenting for Musk, who has also seen his SpaceX business excel with multiple satellite launches.
The South African’s meteoric rise is poised to continue but there are risks with everything he is undertaking.
“Pretty much all of his companies are moonshots,” says Kenny.
“Fifteen ago he said I’m going to make this electric car company worth an absolute fortune, I’m going to make a reusable rocket company, a hyperloop train and a company that makes brain machine interfaces.”
The policy manager says it would be a “struggle” to turn one of them into a success but Musk seems to be juggling them.
“They are still quite high risk however,” Kenny says. “If you look at SpaceX, it is literally rocket science.”
Musk’s SpaceX, is poised to pad his fortune by another $3bn. The company announced it raised $1.9bn in new funding in an SEC filing Tuesday. The funding round increases its equity valuation to $46bn, $10bn more than its last funding round in May.
Left-wing think tank Inequality.org placed Musk among the “Oligarch dozen” - a collection of billionaires that had gained the most during the pandemic. The group even labelled him as the biggest “pandemic profiteer”.
When asked about the rise in his net worth, the outspoken entrepreneur reportedly told Forbes that he “really couldn't care less”.
“These numbers rise and fall, but what really matters is making great products that people love,” the business magnate said.
This year, he even committed to selling his worldly possessions, saying that they can be used as an “attack vector”.
“People say ‘hey you’re a billionaire, you’ve got all this stuff’, well now I don’t so what are you going to do,” he said on the Joe Rogan Experience.
As long as the numbers tacked onto his wealth continue their upward trend, it appears he will have to deal with the pejorative description of “billionaire” for some time yet.