More Musk

THE HYPERLOOP

California isn't thinking BIG ENOUGH!

I'll never get over Chris Christie nixing the tunnel to New York. The future is coming, we've got to prepare for it. Which is why we need high speed rail, right?

Not if it's the slowest bullet train in the world and it's gonna take until 2029 to complete.

"They say I'm a dreamer
But I'm not the only one"

Used to be we counted on politicians and artists to inspire us, to presage the great leaps forward. Now the only people doing this are techies. Hell, the music industry still hasn't gotten over Napster and is selling CDs and arguing about streaming payments when the public has already moved far beyond it. What kind of bizarre world do we live in where the public is ahead of an industry? It'd be like United introducing coast to coast turboprops or taxi companies promoting less punctual, dirtier cabs. The key is to get ahead of people! Have them come to you!

I'm going to print Musk's explanation of the Hyperloop below, because although it seems like science fiction on the surface, once you get into the details it seems...possible. Then again, I'm just an arts guy and don't know much about science. But I remember the sixties, when John Glenn orbited the Earth and we were all enthralled and inspired by science. What are we inspiring people to do now, post tinted pictures on Instagram?

We need leaders. Don't bother watching the parking meters.

PAYPAL BANKING

Squeezed out of PayPal, one thinks anything Musk has to say about the company is sour grapes. Until you dig down into his vision for the enterprise.

PayPal's success was built upon the low cost of transactions. To turn it in to more than a payments service is to both revolutionize banking and serve the customer. Once again, when you read Musk's explanation below it will all make sense. Especially the money market fund that paid more than any other just to keep customers in the system. It would make no money for PayPal itself, but cement customers to the system, for their ultimate benefit. That's a far cry from the modern banking system that wants to charge you at every turn and deliver less.

COAL

My inbox is filling up with naysayers pointing out that the Tesla's electricity, its fuel, is generated by coal-fired plants. And that is true. But nowhere do you see it written how inefficient the internal combustion engine is, that's one of the main selling points of electric cars, they they're much more efficient in turning their energy source into propulsion. Cars are 10-20% efficient, a Tesla is 60% efficient.

Welcome to the new America where everybody lives in an echo chamber and has knowledge an inch deep. They know what a Tesla is, but have no idea how it works, what its benefits are. This is a major issue in the information society, people just don't know what's going on. Furthermore, those with a negative agenda can spread falsehoods to achieve their goals. I mean how many people know about the above-stated efficiency of electric vehicles? I certainly didn't.

Find a further explanation below.

GOING PUBLIC

That's what those with short term thinking who want to lose control of their companies do. Tesla went public because it needed the cash. But Musk wants to keep SpaceX private because public scrutiny would hammer and ultimately hobble the developing company. But what about the workers? What about their ability to profit on their stock?

Musk sent SpaceX employees a memo containing the below:

"'For those who are under the impression that they are so clever that they can outsmart public market investors and would sell SpaceX stock at the "right time,' let me relieve you of any such notion. If you really are better than most hedge fund managers, then there is no need to worry about the value of your SpaceX stock, as you can just invest in other public company stocks and make billions of dollars in the market.'"

Everybody's a self-stated expert, everybody can do anything, hedge funders are dumb people making easy money. No, the truth is running a hedge fund is a skill. And if you think you can compete with the pros, you're truly demonstrating you're an amateur. Eric Clapton can play rings around you on the guitar and George Soros can eat your portfolio for breakfast.

SPELLING COUNTS

"Marketing people who made grammatical mistakes in e-mails were let go..."

People judge you by your mistakes, especially if it's your gig. Ever hear of spellcheck? Use it, especially if you're looking for a job or interacting with someone higher up the food chain. I know a woman who judges who to date based on the spelling mistakes. You think looks are everything...not to many winners.

If you can't perform the essence of your job flawlessly, we've got no time for you.

CONCLUSION

All of the foregoing are lessons learned in Ashlee Vance's excellent book "Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future": http://amzn.to/1JiOrN0

You can read it for tips, but you should really read it for inspiration.

Not everybody can win, not everybody can rule the world, but you can certainly try. Or align with a leader who is trying to accomplish these goals. Life is most fulfilling when it has value. It sucks to live with no cash, but once you get a certain amount you're happiest when your life has meaning, which is usually accomplished through work. Ignore the constant trumpeting of numbers, they're oftentimes fake, instead of focusing on the dollars look for the accomplishments. Did the artist have another hit? Do they still play their music? Does someone experience your product and smile? Are you changing the world?
That's today's goal.

"For the loser now will be later to win
For the times they are a-changin'"

THE HYPERLOOP 2

"'The sixty-billion-dollar bullet train they're proposing in California would be the slowest bullet train in the world at the highest cost per mile,' Musk said. 'They're going for records in all the wrong ways.' California's high-speed rail is meant to allow people to go from Los Angeles to San Francisco in about two and a half hours upon its completion in - wait for it - 2029. It takes about an hour to fly between the cities today and five hours to drive, placing the train right in the zone of mediocrity, which particularly gnawed at Musk. He insisted the Hyperloop would cost about $6 billion to $10 billion, go faster than a plane, and let people drive their cars onto a pod and drive out into a new city."

Musk is famous for overpromising when it comes to cost and delivery date, but he always delivers. With fifteen years to accomplish his goal, wouldn't we be better off giving him a chance as opposed to investing in an antiquated system?

This is how the Hyperloop works:

"Billed as a new mode of transportation, this machine (the Hyperloop) was a large-scale pneumatic tube like the ones used to send mail around offices. Musk proposed linking cities like Los Angeles and San Francisco via an elevated version of this kind of tube that would transport people and cars in pods. Similar ideas had been proposed before, but Musk's creation had some unique elements. He called for the tube to run under low pressure and for the pods to float on a bed of air produced by skis at their base. Each pod would be thrust forward by an electromagnetic pulse, and motors placed throughout the tube would give the pods added boosts as needed. These mechanisms could keep the pods going at 800 mph, allowing someone to travel from Los Angeles to San Francisco in about thirty minutes. The whole thing would, of course, be solar-powered and aimed at linking cities less than a thousand miles apart. 'It makes sense for things like L.A. to San Francisco, New York to D.C., New York to
Boston,' Musk said at the time. 'Over one thousand miles, the tube cost starts to become prohibitive, and you don't want tubes every which way. You don't want to live in Tube Land.'"

PAYPAL BANKING 2

"'Almost no one understands how PayPal actually worked or why it took off when other payment systems before and after it didn't. Most of the people at PayPal don't understand this. The reason it worked was because the cost of transactions in PayPal was lower than any other system. And the reason the cost of transactions was lower is because we were able to do an increasing percentage of our transactions as ACH, or automated clearinghouse, electronic transactions, and most importantly, internal transactions. Internal transactions were essentially fraud-free and cost us nothing. An ACH transaction costs, I don't know, like twenty cents or something. But it was slow, so that was the bad thing. It's dependent on the bank's batch processing time. And then the credit card transaction was fast, but expensive in terms of the credit card processing fees and very prone to fraud. That's the problem Square is having now.

'Square is doing the wrong version of PayPal. The critical thing is to achieve internal transactions. This is vital because they are instant, fraud-free, and fee-free. If you're a seller and have various options, and PayPal has the lowest fees and is the most secure, it's obviously the right thing to use.

'When you look at like any given business, like say a business is making 10 percent profitability. They're making 10 percent profit when they may net out all of their costs. You know, revenue minus expenses in a year, they're 10 percent. If using PayPal means you pay 2 percent for your transactions and using some other systems means you pay 4 percent, that means using PayPal gives you a 20 percent increase in your profitability. You'd have to be brain dead not to do that. Right?

'So because about half of PayPal's transactions in the summer of 2001 were internal or ACH transactions, then our fundamental costs of transactions were half because we'd have half credit cards, we'd have that and then the other half would be free. The question then is how do you give people a reason to keep money in the system.

'That's why we created a PayPal debit card. It's a little counterintuitive, but the easier you make it for people to get money out of PayPal, the less they'll want to do it. But if the only way for them to spend money or access it in any way is to move it to a traditional bank, that's what they'll do instantly. The other thing was the PayPal money market fund. We did that because if you consider the reasons that people might move the money out, well, they'll move it to either conduct transactions in the physical world or because they're getting a higher interest rate. So I instituted the highest-return money market fund in the country. Basically, the money market fund was at cost. We didn't intend to make any money on it, in order to encourage people to keep their money in the system. And then we also had like the ability to pay regular bills like your electricity bill and that kind of thing on PayPal.

'There were a bunch of things that should have been done like checks. Because even though people don't use a lot of checks they still use some checks. So if you force people to say, "Okay, we're not going to let you use checks ever,' they're like, "Okay, I guess I have to have a bank account." Just give them a few checks, for God's sake.

'I mean, it's so ridiculous that PayPal today is worse than PayPal circa end of 2001. That's insane.

'None of these start-ups understand the objective. The objective should be - what delivers fundamental value. I think it's important to look at things from a standpoint of what is actually the best thing for the economy. If people can conduct their transactions quickly and securely that's better for them. If it's simpler to conduct their financial life it's better for them. So, if all your financial affairs are seamlessly integrated one place it's very easy to do transactions and the fees associated with transactions are low. These are all good things. Why aren't they doing this? It's mad.'"

Makes complete sense, right? That's what separates the winners from the losers, the innovators from the also-rans, they see a problem and come up with a solution the average person could not think of, which is why analytical skills are key. Which is why Steve Jobs said to get a liberal arts education, because if you know how to think, this ever-changing world is your oyster.

COAL 2

"For both engineers and green-minded people, the Model S presented a model of efficiency. Traditional cars and hybrids have anywhere from hundreds to thousands of moving parts. The engine must perform constant, controlled explosions with pistons, crankshafts, oil filters, alternators, fans, distributors, valves, coils, and cylinders among the many pieces of machinery needed for the work. The oomph produced by the engine must then be passed through clutches, gears, and driveshafts to make the wheels turn, and then exhaust systems have to deal with the waste. Cars end up being about 10 - 20 percent efficient at turning the input of gasoline into the output of propulsion. Most of the energy (about 70 percent) is lost as heat in the engine, while the rest is lost through wind resistance, braking, and other mechanical functions. The Model S, by contrast, has about a dozen moving parts, with the battery pack sending energy instantly to a watermelon-sized motor that turns the wheels. The
Model S ends up being about 60 percent efficient, losing most of the rest of its energy to heat. The sedan gets the equivalent of about 100 miles per gallon."


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