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How Elon Works

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the biography of Elon Musk that was

written by Walter Isacson came out a few

years ago. It's 615 pages long and so I

read the book for the first time when it

came out and I didn't think I could make

a great episode about it and I think

I've now finally figured out what I

really want to talk to you about. It's

it's gonna sound crazy because Elon is

the richest person on the planet and the

most famous entrepreneur alive, but I

think that all of the other stuff, the

politics, the tweets, the constant

appearance in the news or there's like,

you know, new controversies all the

time, it just really distracts and takes

away from the fact that Elon has a set

of timeless and brilliant and insanely

valuable principles on how to build

companies, how to invent new technology,

and how to make an impact on the world

around you. And so this is what I did. I

have spent at least at least 60 hours

reading and rereading this book. This

book is written in chronological order.

So I would say it's more akin to reading

a series of news reports over a few

decades than the typical way a biography

is written. And so, as it turns out,

that's going to be a major asset for you

and I because what you'll see and what I

exclusively want to focus on is the

enduring set of company building

principles Elon has used over three

decades and across at least seven

companies. So, it may be apocryphal, but

there is a quote from Michelangelo when

he was asked like how he created the

statue of David and he replied, "I just

chipped away everything that was not

David. So, what I've done is edited down

my 40 pages of notes and highlights from

the book into just the way that Elon

works. I want to focus on the ideas that

he used to build his companies and to

build what I think is a truly singular

career. I don't think there's anyone

else like him living our dead. And so,

I'm going to go through his ideas in

chronological order so you can see how

they appear, reappear, and how they are

edited and iterated on over time. And so

at the end of the episode or by the end

of episode I should say it will be

impossible for you not to understand how

Elon works and then what I think we both

should do is we should sit with these

ideas write them down and then think

deeply about how we can apply some of

them to our work. I think one of the

superpowers of this project that has

been going on for almost a decade where

you and I get together every week and we

talk about another one of history's

greatest founders is that we see that

somehow people that didn't know each

other were alive at different points in

history worked in different industries

lived in different parts of the world

all arrived at very similar conclusions

on how to build themselves and their

company into something great. So I want

to start when Elon's in college right

before he starts his first company Zip

2. This is something that's mentioned.

Every single thing I'm going to tell you

is repeated over and over again. This is

why I think they're so powerful. So, one

thing that's repeated over and over

again is the fact that Elon loves

strategy games, whether they're board

games or they're video games. In this

case, in college, he was obsessed with

this board game, this classic strategy

board game called Diplomacy. And it says

that immersing himself in these games

for hours became the way he relaxed,

escaped stress, and honed his tactical

skills and strategic thinking for

business. He was drawn to these games

from an early age. When he was asked

why, he told one of his friends, I am

wired for war. That sentence, I am wired

for war, Elon will repeat across decades.

decades.

When he was in his early 20s, he had an

internship says Elon did not like nor

was he good at working for other people.

It was not in his nature to be

differential or to assume that others

might know more than he did. Again, he

was like this in his early 20s. He's

still like that today. when they start

Zip 2. One of the things that he repeats

over and over again is the importance of

being hardcore, of working every single

waking hour. When they started Zip 2,

they slept in the office and showered at

the YMCA. Another one of Elon's core

principles, this is the way I describe

it. This is not the way he describes it,

is that Elon understands that

showmanship is salesmanship. So, they

would bring people into the Zip 2

office. It says they bought a big frame

for a computer rack and put one of their

small computers inside so that visitors

would think they had a giant server.

Every time investors would come in, we

showed them that tower. It made them

think we were doing hardcore stuff. You

will see him use that over and over

again. Elon understands the power of one

dramatic demonstration. From the very

beginning of his career, Elon was a

demanding manager, contemptuous of the

concept of work life balance. He drove

himself relentlessly all day and night

without vacations, and he expected

others to do the same. His only

indulgence was allowing breaks for

intense video game binges. That's a

description of Elon in his 20s, I don't

think he can be any other way. One thing

he says when he's building Zip 2 and

uses it for the rest of his life, he is

not a fan of camaraderie or being overly

colleial with the people you work with.

He says over and over again, it's both

count doing so is both counterproductive

and dangerous and that it gets in the

way of actually putting the mission

first. So he says he genuinely did not

care if he offended or intimidated the

people he worked with as long as he

drove them to accomplish feats that they

thought were impossible. It's not your

job to make people on your team love

you. He would say years later at a

SpaceX executive session, in fact,

that's counterproductive.

One thing that he did not like early in

his career and he never likes, he hates

middlemen. A good way to think about

Elon is Elon wants full control over

everything always. True product people

have a compulsion to sell directly to

consumers without middlemen mudding

things up. Elon was that way. Less than

four years after starting Zip 2, Elon

and his brother, they went up selling

the company to Compact Computer. Compact

bought it for $37 million in cash. So by

the time Elon was 27 years old, he had

$22 million from the sale of his

company. And what's fascinating is

there's all these interviews he was

doing when he was 27. And we see that

he's not it's not the money that's the

motivator. The true sense of

satisfaction, the true sense of

accomplishment is building a real

company. And so he says, I could go buy

an island, but I'm much more interested

in trying to build and create a new

company. I haven't spent all of my win

winnings. I'm going to put almost all of

it back into a new game. He said, the

real payoff is the sense of satisfaction

in having created a company. And so this

is the note I left after I read the book

and I go back and I reread my highlights

and notes compulsively before I sit down

and talk to you. And so this is what I

said. Make money and put it back into

another company. That is a trait of his

that he repeats for decades. More than

20 years later when he had a bunch of

cash from selling Tesla stock, he put it

into Twitter. He hates having money just

sitting there. And so that's a theme

that's going to reappear over and over

again is the fact that the money is for

putting it into a company and solving a

problem. What interested him was the

problems that he wanted to solve. and he

was willing to have an insanely high

risk tolerance even when he was younger

because he said, "I'm either going to be

wealthy or broke, but it's not going to

be anything in between." And so, another

enduring principle of Elon that he uses

throughout his career is the fact that

belief is irresistible. You will hear

quotes like this across decades from

different companies, from all kinds of

different people that knew Elon. Even

when it seemed like crazy talk, you

would believe him because he believed

it. Elon has the ability to transfer his

belief to other people. He is

contemptuous of work life balance. His

management style has not changed from

Zip 2, nor would it ever. I am by nature

obsessive compulsive, Elon said. What

matters to me is winning and not in a

small way. So Elon starts his next

company and it's the exact same

management style that he had at his

first company and he will have forever.

One of Elon's management tactics was to

set an insane deadline and drive

colleagues to meet it. Elon slept under

his desk most nights. Elon is intense in

all things. This is a description of him

when he's playing video games. He was

sweating. And you can see that he has a

bundle of energy and intensity. One of

the most shocking things of this book,

especially if you eliminate everything

that's not how Elon works, is Elon's

obsession with simplification and

deleting. Half the book is him just

yelling at people to delete, to edit,

and to simplify. He does this

relentlessly. He had a passion for

simplicity when it came to designing

user interfaces. I hone the user

interface to get the fewest numbers of

keystrokes to open an account. Elon said

one of the conflicts he had with his

co-founders of PayPal was the fact that

he was not interested in making niche

products. And you see a drastic

difference in the size of his ambition

after selling PayPal. Says it was not in

Elon's nature to make niche products. He

wants to remake entire industries.

We are 79 pages into this book and you

will see one of his most repeated

principles. He has to mention this. I

don't know 25 times for the rest of the

book. Elon restructured the company so

that there was not a separate

engineering department. Instead,

engineers would team up with project

managers. It was a philosophy that he

would carry through to Tesla, SpaceX,

and Twitter. Separating the design of a

product from its engineering was a

recipe for dysfunction.

Designers had to feel the immediate pain

if something they devised was hard to

engineer. Engineers rather than product

managers should lead the team. One of my

favorite maxims from the history of

entrepreneurship is that if you know

your business from A to Z, there's no

problem you can't solve. Over and over

again, starting with PayPal and all the

way up until present day, people are

shocked at how much detail Elon knows

about their area of the company. So, we

have one of his co-founders, Max

Lovechin, back in the PayPal days were

saying, "Elon will say crazy stuff, but

every once in a while, he'll surprise

you by knowing way more than you do

about your own specialty." I think a

huge part of the way he motivates people

are these displays of sharpness. Another

principle that he identified in my

opinion very correctly from a young age

is the fact that the CEO, the founder

should be the public face of the company

and that he really believed he was the

best spokesperson for his company.

Here's a collection of descriptions of

Elon when he was building PayPal. The

reason I include this is because Elon is

still like this three decades later. And

you will have people in all his other

companies say the exact same thing about

him. He has a relentless and rough

personal style. He has a desire to take

risks. He was into amplifying risk and

burning the boats so that we could never

retreat from it. He has a level of

certainty that causes him to put all of

his chips on the table. And then what I

would say is they talked about the fact

that he got kicked out of PayPal as CEO.

He does something really smart which

I'll get to later which he doesn't

destroy the relationships with his

co-founders which actually winds up

saving SpaceX about a decade later. But

I think it's very obvious and it's very

important. Elon has superhuman levels of

self-confidence. He was he was being

interviewed by the author by Walter

Igson many many decades later and he

says this. If I had stayed, PayPal would

be a trillion dollar company. I think he

truly believes that in his heart and

soul. So when he gets kicked out of

PayPal, he's got to pick what do I want

to work on next? And this is where his

ambition just skyrockets. And so he's

going to start a rocket company. This is

what he does. He went to the Palo Alto

public library to read about rocket

engineering and started calling experts

asking to borrow their old engine

manuals. There will be many times where

people said Elon read everything. This

is something that reappears throughout

the history of entrepreneurship. The

shorthand I have for this is they

devoured entire shelves. Thomas Edison,

Winston Churchill, Michael Dell, Edwin

Lan, they would read every single thing

in a library on their subject of

interest. One of my favorite stories

about this is Edwin Lan goes to Harvard,

is obsessed with the science of light

and optics, reads every single book on

light and optics in Harvard's library.

once he gets to the end, realizes, "I've

learned everything I can learn here."

Drops out, moves to New York City, goes

to the New York City public library,

does the exact same thing. They devour

entire shelves. And so, in between

PayPal and starting SpaceX, he's asked,

"What are you going to do? I'm going to

colonize Mars. My mission in life is to

make mankind a multilanetary

civilization." He was talking to

somebody. They're like, "Wait, how is

this a business?" Then the person he's

talking to is like, "Oh, Elon doesn't

think that way. Elon starts with a

mission. This is very important. This

will be repeated over and over and over

again. Elon starts with a mission and

later finds a way to backfill in order

to make it work financially. And I think

the following sentence is one of the

most important sentences in the book. It

is useful to pause for a moment and note

how wild it was for a 30-year-old

entrepreneur who had been ousted from

two tech startups to decide to build

rockets that could go to Mars.

Another principle that he starts to

repeat around this time, you can still

hear this till this day is the fact that

technological progress is not

inevitable. It's not some kind of

abstract concept. Humans make

technology. If we don't do it, it will

not happen. It just doesn't march

forward on its own. And in many cases it

could even backslide. He says people are

mistaken when they think that technology

just automatically improves. It only

improves if a lot of people work very

hard to make it better. This is directly

tied to one of his mostused principles.

Elon has the ability to see his

endeavors as having epochm significance.

One of Elon's greatest skills is the

ability to pass off his vision as a

mandate from heaven. He understands the

importance of inspiring people. That we

must have inspiring things in the world

that we must pursue great dreams. This

is what he says. To have a base on Mars

would be incredibly difficult and people

will probably die along the way just as

happened in the settling of the United

States. But it will be incredibly

inspiring and we must have inspiring

things in the world. Life cannot be

merely about solving problems. It also

has to be about pursuing great dreams.

That is what will get us up in the

morning. And this next part is like the

kernel of an idea that he'll use over

and over again that you need to go where

you have the highest chance of

succeeding. And later on the version

that he uses over and over again is you

need to go to where the problem is. He's

constantly searching for bottlenecks

across this entire empire. And then once

he identifies them, he just gets on the

plane immediately and goes right to the

problem and stays there until that

problem is solved. He decided if he was

going to start a rocket company, it was

best to move to Los Angeles. The

probability of success for a rocket

company was quite low. Elon said, and it

was even lower if I did not move to

Southern California, where the critical

mass of aerospace engineering talent was

at the time. Now, the next sentence, I I

truly believe that sometimes a single

sentence can tell an entire story. This

next sentence is an example of that.

Keep in mind the fact that his first

wife's name is Justine. He didn't even

explain the move to Justine. That is

another thing that will reappear over

and over again in Elon's life. In fact,

it says Elon was not bred for domestic

tranquility. You cannot work as much as

Elon works. You cannot dedicate as large

part of your waking existence to your

work as Elon does and expect to have

relationships. So then as he's trying to

figure out how the hell do I build my

own rocket, he comes up with one of his

greatest ideas and something he's going

to use for the rest of his career. He

names things really well, too. He calls

this the idiot index. So it says Elon

employed first principles thinking

drilling down to the basic physics of

the situation and building up from

there. That is again something you and I

are going to talk about 100 times today.

This led him to develop what he called

an idiot index which calculated how much

more costly a finished product was than

the cost of its basic materials. If a

product had a high idiot index, its cost

could be reduced significantly by

devising more efficient manufacturing

techniques. Rockets had an extremely

high idiot index. Elon be calculating

the cost of carbon fiber, metal, fuel,

and other materials that went into them.

The finished product using the current

manufacturing methods costs at least 50

times more than that. The word cost appears

appears

158 times in this book. Elon is obsessed

with controlling costs. I have a note to

myself from later in the book that says

he surrounded himself with biographies.

Of course, he's obsessed with cost

control. There are many examples in

other books uh that I've read on Elon of

Elon obsessively reading biographies.

This is something that he has in common

with all of history's greatest

entrepreneurs from Elon today all the

way to Carnegie and Rockefeller and

everyone in between. If you are great,

you stay in the details on cost. That is

why RAMP is the presenting sponsor of

this podcast. I've gotten to know all

the co-founders of Ramp and have spent a

ton of time with them over the last two

years. They all listen to the podcast

and they've picked up on the fact the

main theme from the podcast is on the

importance of watching your costs and

controlling your spend and how doing so

will give you a massive competitive

advantage. You're going to see this with

Elon's companies over and over and over

again as we keep going through this

book. One of my favorite ways to

illustrate this and why it's so

important is actually from a biography

of Andrew Carnegie who keep in mind when

Carnegie sold his company to JP Morgan.

Carnegie had the world's largest liquid

fortune. And so the quote from his

biography says Carnegie would repeat

this mantra time and time again. Elon,

as you'll see today, he repeats mantras

again and again and again. I'm like

screaming about this. I'm telling you,

if Carnegie says this, if Elon says

this, that is it's like a bright

flashing red light to you and I. Hey,

this is probably a good idea. This is

what Carnegie this is Carnegiey's

mantra. Profits and prices are cyclical,

subject to any number of transient

forces of the marketplace. Costs,

however, could be strictly controlled

and any savings achieved in the costs of

goods were permanent. Cost control

became nearly an obsession for Andrew

Carnegie. It is an obsession with Elon 2

and that is a main theme for Ramp. The

reason that Ramp exists is to give you

everything you need to control your

spend. RAM gives you everything you need

to control your cost. RAM gives you easy

to use corporate cards for your entire

team, automated expense reporting, bill

payments, accounting, and cost control.

And they do this on a single platform.

The greats all study the greats. And the

easiest way to study the greats today is

by listening to founders. So many of the

top founders and CEOs listen to

founders. And I hear from them all the

time. Most of the excellent operators I

know run their business on ramp. If

you're not running your business yet on

ramp, you should be. Make history's

greatest entrepreneurs proud by going to

ramp.com to learn how they can help your

business today. That is ramp.com. Now,

back to a principle that Elon repeats a

lot. In laying out the factory, Elon

followed his philosophy that the design,

engineering, and manufacturing teams

would all be clustered together. The

people on the assembly line should be

able to immediately collar a designer or

engineer and say, "Why the [ __ ] did you

make it this way?" Elon explained, "This

is really brilliant what he's about to

say. It's like it's like a simple

genius. If your hand is on a stove and

it gets hot, you pull it right off. But

if it's someone else's hand on the

stove, it will take you longer to do

something. And so he will constantly

repeat, you cannot separate design,

engineering, and manufacturing. They

need to be together because you are

going to make mistakes. And you want to

identify and fix those mistakes today,

right now. And if you separate them, the

mistakes will fester. There's a term

that's used in the book that says Elon

likes fresh blood. He will churn through

people rapidly. If you were negative or

thought something couldn't be done, you

would not be invited to the next

meeting. In many cases, you were fired.

He wanted people who would make things

happen. On to the next highlight. Elon

was laser focused on keeping costs down.

Cost effectiveness was critical. He

challenged the prices that aerospace

suppliers charged for components, which

were usually 10 times higher than

similar parts in the auto industry.

He'll constantly go back, what is the

idiot index on this? He'll drill into

you in meetings if you don't know. His

focus on cost as well as his natural

controlling instincts led him to want to

manufacture as many components as

possible in house. Remember, Elon wants

control over everything always rather

than buy them from suppliers, which was

then the standard practice in the rocket

and car industries. He does not give a

damn what the standard practice is of

any industry. He will constantly

challenge himself and other people

around him. Go down to first principles

thinking. Here's an example of the idiot

index. A supplier quoted a price of $120,000.

$120,000.

Elon said that the part was no more

complicated than a garage door opener

and told one of his engineers to make

the part. His engineer made it and it

only cost $5,000.

This directly leads into another one of

his most repeated principles and one

thing that he repeats over and over

again. You need to question every single

requirement. He probably says that 25

times in the book. He made his engineers

question all specifications. This would

later become step one in a fivepoint

checklist dubbed the algorithm that

became an off- repeated mantra when

developing products. Whenever one of his

engineers cited a requirement as a

reason for doing something, Elon would

grill them. Who made the requirement?

And answering the military or the legal

department was not good enough. This is

brilliant. Elon would insist that they

know the name of the actual person who

made the requirement. All requirements

should be treated as recommendations.

Elon repeatedly instructed. The only

immutable ones were those decreed by the

laws of physics. He said another one of

his core operating principles that he

will repeat over and over again is that

a maniacal sense of urgency is our

operating principle. A maniacal sense of

urgency is our operating principle.

Here's an example of that. How in the

[ __ ] can it take so long? Elon asked.

This is stupid. Cut it in half. Mueller

balked. You can't just take a schedule

that we already cut in half and then cut

it in half again. Elon looked at him

coldly and told him to stay behind after

the meeting. He then asked Mueller

whether he wanted to remain in charge of

engines. When Mueller said yes, Elon

replied, "Then when I ask for something,

you [ __ ] give it to me." Half of this

book is Elon telling people to go

faster. This is why he does this. Even

though we failed to meet most schedules

or cost targets that Elon laid out, we

still beat all of our peers. Mueller

admits that is the result of having a

maniacal sense of urgency as your

operating principle. Another thing he

repeats to everybody around him, he

expects you to know all the details of

your part of the business and he will

erupt in anger if you don't. Elon would

pepper them with technical questions. He

would erupt with searing fury when an

engineer did not know an answer. He

considered himself a frontline general.

He will repeat over and over again how

important it is to be a frontline

general. He's on the factory floor. He's

climbing on top of roofs. He's

underneath rockets. And so as a result

that he's constantly there talking

directly to the people doing work. Says

Elon's willingness to work all night at

the factory pursuing innovations

inspired his engineers. Another thing

that's important to understand and

repeat is Elon wants total control all

the time, always. He does not like

partnering with other companies. He will

churn through people. There is an

exception to this. says Elon does not

naturally partner with people.

Collegiality was not part of his skill

set and difference not in his nature. He

does not like to share power. One of the

few exceptions was his relationship with

Gwyn Shotwell. She has worked with Elon

for more than 20 years, longer than

anyone else. And so she has a bunch of

advice on how do you actually work with

people like this. He says Shotwell

thought the team was clueless. This is

when she first met Elon. Shottwell

thought the team was clueless about how

to sell services. The guy you have doing

discussions with possible customers is a

loser. She told Elon bluntly. The next

day she got a call asking her to be vice

president of business development. This

is very obvious if you read a bunch of

books on Elon. Also pops out in a bunch

of books on Steve Jobs. I would say the

principle applies across when you're

dealing with these maniacal people like

this. The worst thing you could do is

knuckle under. The worst thing you could

do is back down. They only respect

strength. And over time, as they become

more powerful and more famous, very few

people actually tell them the truth. And

so what Gwen did there was perfect. He's

like, "No, this guy's a loser, and

here's why I could do this better." And

then at the very beginning of Tesla, we

see the exact same idea used over and

over again. Again, this is repeated over

decades. Elon focused on the importance

of the mission rather than the potential

of the business. Here's an example of

his obsession with cost control and with

control in general. One of the most

important decisions that Elon made about

Tesla was that it should make its own

key components rather than piecing

together a car with hundreds of

components from independent suppliers.

Tesla would control its own destiny and

quality and costs and supply chain by

being vertically integrated. Creating a

good car was important. Even more

important was crafting the manufacturing

processes and factories that could

massroduce them from the battery cells

to the body. In the early days of the

industry, Henry Ford and other pioneer

car makers did most of the work inhouse.

When I got to the section, the note I

left myself is Ford was so obsessed with

control, he owned a [ __ ] railroad.

And he did that so he could ensure all

the source materials that he needed for

his car, which he also owned, got to him

when he wanted them. And so that's the

way the industry starts. Then in America

deviates and they wonder why the quality

falls off a cliff. And then 50 years

later, you have Elon start another car

company. He's like, "No, I'm just going

to go back and control everything." This

is one of the things I personally admire

most about Elon. He's anti-outsourcing.

And over the following pages are just a

few lines that give you an idea why he

has to be this way. It is in his nature.

Elon had to have ultimate authority. It

was not in his nature to defer. Few

pages later, he could not refrain from

getting involved in design and

engineering decisions. Now, one area

that Elon is very different from most of

the people that you and I study is the

fact that he's running all these comp

companies simultaneously. Usually, the

people you and I talk about are focused

inside one company. Now, what I realized

is one of the benefits of running

multiple companies simultaneously is

this transfer of ideas and lessons

learned in one to other ones. And so,

I'm going to bring that to your

attention a few times today. So, to

hopefully to for that lesson to like

really stick in your brain, but here's

the first example. Over the years, Elon

was able to use techniques learned at

SpaceX and apply them to Tesla and vice

versa. When Eberhard pushed back on the

cost of carbon fiber, this is at Tesla.

Elon sent him an email. Dude, you could

make the body panels for at least 500

cars per year if you bought the soft

oven we have at SpaceX. If someone tells

you this is hard, they are full of [ __ ]

Let's go to one trade of his that ties

everything together. This guy's got

superhuman levels of determination and

there's just the only way to that he's

ever going to quit is when he dies. And

what's fascinating is even people that

made money off of him in the past still

underestimated his level of dedication.

And so he's pitching Michael Morates at

Sequoa to invest in Tesla even though

they made a bunch of money in PayPal.

And so Moritz calls Elon. He's like,

"Hey, I'm not going to invest. We're not

going to compete against Toyota. That is

mission impossible." Years later,

Morates conceded. I didn't appreciate

the strength of Elon's determination.

Another principle I've already mentioned

once, it's over and over again in the

book. The maxim I have on this is

showmanship is salesmanship. Elon had an

enthusiastic attraction to publicity.

Elon believed an important element in

launching a new product is an event. So,

they're building the very first Tesla

Roadster. I think they only made like

200 of these things. When the prototype

Roadster was ready, Elon put on the

event. And then this also ties in the

fact that he's a showman, but he's

obsessed with details. All of his ideas

you'll see he uses over and over again,

but they interact well with each other.

This is the magic. So, when the the

event for the prototype Roadster was

being planned, Elon planned the event.

Elon personally took over planning the

event. If it's I guess my my what I'm

trying to tell you here is if it's

important, he's doing it. Elon

personally took over planning the event.

He oversaw the guest list, chose the

menu, and even approved the cost and

design of the napkins. Another thing

that's repeated over and over again in

the book by Elon is the importance of

making sure that you have failures. He

says something later on. He's like,

"Yeah, your first 50 failures are going

to be really painful and they're going

to really hurt, but eventually over

time, you're less emotional. And if

you're less emotional, you could take

more calculated risks. What I would say

is one of the most important things

about this book is the book is full of

Elon making decisions that he'll come to

regret later. That is inevitable if

you're trying to succeed at anything,

especially if you're trying to innovate

and create something new. And then I

think one of the most important concepts

of this book that, you know, really sat

in my mind after is like, oh, the people

that succeed the most also have the most

failures. And part of what makes him

most successful and also fail a lot is

the fact that he doesn't have any

patience. It's a virtue that he lacks.

And so he's talking about the fact that

they tried to build and and launch the

first SpaceX rockets from this remote

island called Quas. And he says Elon

would later admit that moving to Quash

was a mistake. He should have waited for

Vandenberg to become available. But that

would have required patience. And that's

a virtue he lacked. This is what Elon

said. Every now and then you shoot

yourself in the foot. If you had to pick

a path that reduced the probability of

success, it would be to launch from an

inaccessible tropical island. And so

then they tell a story about just how

difficult it was because of this remote

location just to get the supplies they

needed for the rockets there. And so

this is a great little story. Don't

worry about remembering the names in the

story. The capacitors were available in

an electronic supply house in Minnesota.

So an intern in that was in Texas was

dispatched there. So send the intern

from Texas to Minneapolis to pick that

up. Right. Meanwhile, Altan removed the

power boxes from the rocket on Omalch,

which is this island in the the Pacific.

jumped on a boat to Quage, slept on a

concrete slab outside the airport,

waiting for an early morning flight to

Honolulu, and then made the connection

to Los Angeles, and then drove to SpaceX

headquarters. There he met the intern

who had gone from Texas to Minnesota.

Now he's in LA, who had arrived from

Minnesota with the new capacitors. He

swapped them into the faulty power

boxes. Then he and Elon jumped into

Elon's jet for the dash back to Quash.

Keep in mind at this point they had

SpaceX had yet to successfully launch a

single rocket on the plane. Elon

bombarded him with questions on every

detail of the circuitry. So that part

reminds me of this excerpt from the Elon

biography that was written many years

ago by Ashley Vance. And the way I think

about this excerpt that I want to read

to you is this is how Elon thinks about

the relationship between time and money.

And it's one of my favorite ideas I've

ever come across. So it says Elon would

always be at work on Sunday and we had

some chats where he laid out his

philosophy. So this is an early SpaceX

employee that is telling us the story.

He would say that everything we did was

a function of our burn rate and that we

were burning through $100,000 per day.

It was this very entrepreneurial Silicon

Valley way of thinking that none of the

aerospace engineers in Los Angeles were

dialed into. Sometimes he wouldn't let

you buy a part for $2,000 because he

expected you to find it cheaper or to

invent something cheaper. Other times he

wouldn't flinch at renting a plane for

$90,000 to get something to the quage

because it saved an entire workday, so

it was worth it. This is my favorite

part and the main point. He would place

this urgency that he expected the

revenue in 10 years to be $10 million a

day and that every day we were slower to

achieve our goals was a day of missing

out on that money.

And then I absolutely love Elon's

response to failure, to a rocket blowing

up, to not having a successful mission.

Later that day, he posted a statement.

SpaceX is in this for the long haul.

come hell or high water, we are going to

make this work. I think those kind of

statements are important. We're in this

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We take our work deadly seriously. And

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So then we get right into another one of

Elon's principles that he'll use over

and over again. Go to the problem. Fly

to the source. Go to the exact location

in the factory. Go to where the problem

is. So they're trying to build a

roadster. Costs are drastically

expanded. The target cost of the

Roadster goes from they thought it was

going to be $50,000 to make each one.

The cost has now swelled to 83,000. And

so as soon as Elon hears this, he calls

one of his employees. He says, "I'm

getting in my plane. I'm going to pick

you up in Chicago." and we're going to

sort this out in England. He flies

directly to the factory. This is Lotus

Factory to try to figure out what's

going on. Go to the problem. Fly to the

source. Go to the exact location in the

factory. Go to the problem physically.

You'll be amazed how many times Elon

uses that principle over and over and

over again. And so Elon will talk later

on about how he just repeats the same

things over and over again. And he's

constantly teaching and training

everybody around him. And one of the

ideas that he repeats over and over

again is you are not friends with people

on your team. and wanting to be

everyone's friend leads you to care too

much about the emotions of the

individual in front of you rather than

caring about the success of the entire

enterprise. Now, I'm going to pause

there. I could see how other people

like, "Hey, I don't want to be harsh

with people around me." The next

sentence of this is really explains, I

think, in the best way possible why he's

like this. He says that approach can

lead to a far greater number of people

being hurt. His point is you have to

demand demand demand excellence from

everybody on your team that the mission

is over the personal feelings. But if

you let these, you know, instead of

having A players, you have this B or C

player, they can jeopardize the entire

mission. So instead of hurting one

person's feelings, when we all go to

business, you're going to hurt thousands

of people's feelings. And one thing Elon

picked up on, and there's a great line

in the book about this. It says, "A

players don't want to be around fuzzy

thinkers." Elon is always very easy to

understand. He may be asking for things

that are you think are impossible, but

you definitely understand what he wants.

He's not I don't think you can describe

him at all. He's very clear thinker, the

opposite of a fuzzy thinker. And then he

also tells people around him what's

important to him. I'm not willing to

share ultimate responsibility and power.

He says, I've got to have both hands on

the steering wheel. I can't have two of

us driving. And in the book, there's

many examples of just like how powerful

his presence is, how intense he can be.

In fact, I thought this description, his

first wife has a great description of

Elon in the book. And there's actually a

lot of people in the book that says Elon

has multiple personalities in the same

head. And I think Justine describes this

wonderfully. She says he's strong willed

and powerful like a bear. He can be

playful and funny and romp around with

you, but in the end, you're still

dealing with a bear. And then we see

several more examples of what Michael

Mort said. I didn't appreciate the

strength of Elon's determination. Elon

is relentless. Elon will not give up.

It's very hard to beat somebody that

just will not give up. SpaceX had

crashed three rockets in a row. Elon was

not ready to give up. He would go for

broke. Literally, he said, "I will never

give up." And I mean, never. Optimism,

pessimism. [ __ ] that. We're going to

make it happen. As God is my bloody

witness, I'm hellbent on making it work.

And so, it's nice to say that. It's nice

to believe that. Are you actually

willing to do it? You and I know maybe

the greatest maximum in the history of

entrepreneurship ever. Excellence is the

capacity to take pain. Elon has infinite

levels. He has unlimited capacity to

take pain. This is a description of him

when he's 37 years old and both SpaceX

and Tesla are about to die. He is now

with I think his second wife, Tula

Riley, and this is what she describes.

Tula watched in horror as night after

night Elon had mumbling conversations

with himself, sometimes flailing his

arms and screaming. He was having night

terrors and just screaming in his sleep.

He would wake up, go to the bathroom,

and start vomiting. Elon's tolerance for

stress is high, but 2008 almost pushed

him past his limit. I was working every

day, all day and night, in a situation

that required me to pull a rabbit out of

the hat. Now do it again. Now do it

again, Elon says. This is what I

mentioned earlier. I I I don't even

understand why. I can just tell you that

this happened. I I don't understand why.

It was very wise on his part when there

was a coup and he was kicked out of

PayPal by his co-founders. He moved on

and he didn't let his relationship with

his PayPal co-founders die. Six to seven

years later, they helped save SpaceX.

Elon had stayed friendly with the coup

leaders from PayPal. Peter Thiel agreed

that his fund could put $20 million into

SpaceX. Elon says, "After I got

assassinated by the PayPal coup leaders,

like Caesar being stabbed in the Senate,

I could have said, "You guys suck, but I

didn't. If I had done that, Founders

Fund wouldn't have come through in 2008,

and SpaceX would be dead." That is one

of the ways he saves SpaceX. One of the

ways he saves Tesla is by convincing a

giant car company, Daimler, to invest.

Now, this story is going to combine two

of his operating principles that he

repeats over and over again. It's this

idea that a maniacal sense of urgency is

our operating principle. And he's going

to combine that with dramatic

demonstrations, which again, the way I

would describe the maximum for his

dramatic demonstrations. Showmanship is

salesmanship, and it can take many

forms. Here's an example. Die executives

told Elon that they were interested in

creating an electric car, and they had a

team that was planning to visit the US

soon. They invited Tesla to show them a

proposal for an electric version of

Daimmer's smart car. Tesla scrambled to

put together an electric smart car

prototype by the time that the Daimler

team had arrived. So, they bought a

smart car and then put a Roadster

electric motor and battery pack in it.

This is so great. When the Daimler

executives arrived at Tesla, they were

expecting some lame PowerPoint

presentation. Then Elon asked them if

they wanted to drive the car. Tesla had

created a working model. Daimmer

executives were shocked. So they put the

Daimler executives inside the car. The

car bolted forward in an instant and

reached 60 mph in 4 seconds. It blew

them away. Elon then asked Daimler to

invest. Daimler agreed to take a $50

million equity stake in Tesla. This is

what Elon said about this. If Daimler

had not invested in Tesla at that time,

we would have died. Before we get back

into the book, I need to tell you more

about this idea. This idea that

showmanship is show salesmanship is

extremely important. Steve Jobs said

that the storyteller is the most

powerful person in the world. Don

Valentine, founder of Sequoia, he has

this great line about this too. He says

the art of storytelling is critically

important. Most of the entrepreneurs who

come talk to us can't tell a story.

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Now, another thing that Elon's going to

repeat, and he learns this through pain,

do the through the capacity to to keep

going through immense amounts of pain is

if your design is hard to manufacture in

large numbers, then your design is

flawed. He says, "Design is not just

about aesthetics, that true industrial

design must connect the looks of a

product to its engineering." There's

actually a great quote about design from

Steve Jobs in this book that I think is

exactly the way Elon thinks about it.

And this is what Steve said. In most

people's vocabularies, design means

veneer. Nothing could be further from

the meaning of design. Design is the

fundamental soul of a man-made creation

that ends up expressing itself in

successive outer layers. One of the

things I love about Elon and that he'll

use this same idea throughout all these

different companies, he's going to

prioritize personality and fun and

unexpectedness in his products. So, in

early examples, if you saw one of the

early Model S sedans that Tesla makes,

the head designer at Tesla came up with

an idea where it's like, okay, the door

handles were going to keep them flush to

the car and then when you walk up to it,

they would pop out and they would light

up. And he described this like the car

having a happy handshake when the driver

approached with a key. And so, everybody

told Elon around him was like, "Yeah,

but a door handle, like just a regular

door handle would work just as well."

But it says Elon immediately embraced

the idea. It would send a chirpy signal

of friendliness. The handle senses your

approach, lights up, pops out to greet

you, and it's magical, Elon said. And

it's also fun and unexpected. And I

think it's tied to showmanship. A form

of showmanship is salesmanship. When you

surprise your customers, when you

delight them, they form a deeper

emotional bond with your company, but

they also tell other people. It's in

human nature to share things that

surprise us. So then we see another

example of him combining a few

principles together. the fact that he's

just absolutely relentless about

reducing costs and he's relentless about

constantly questioning requirements and

regulations. He doesn't believe the

world is static. He definitely believes

he he can bend it to his will. He'll get

laws changed uh on his behalf later on

in the in the book. We'll get there. It

says Elon save money by questioning

requirements. When he asked his team why

it would cost $2 million to build a pair

of cranes, these are cranes or so

rockets. He was shown all the safety

regulations imposed by the Air Force.

most were obsolete. So SpaceX then goes

to the Air Force and they start

questioning them and he says SpaceX was

able to convince the military to revise

them. The cranes ended up costing

$300,000 instead. He does this over and

over again, but the way he does it too,

it's just really, really smart. He's

just constantly comparing costs for

parts, materials to other industries and

other use cases. So here's an example.

Elon constantly presses team to source

components from non-erospace companies.

The latches used by NASA cost $1,500

each. A SpaceX engineer was able to

modify a latch used in a bathroom stall

and create a locking mechanism that only

cost $30. So, there's one example.

Here's another one. When an engineer

told Elon the air cooling system for the

Falcon 9 would cost $3 million, he

shouted over to Gwen Shotwell to ask her

what an air conditioning system for a

house cost. About $6,000, she said. So,

the SpaceX team bought some commercial

air conditioning units and modified

their pumps so they could work a top the

rocket. And then we see him again apply

that that principle that a maniacal

sense of urgency is our operating

principle. The day before launch, a

final inspection revealed two small

cracks in the engine skirt of the

rocket's second state. Everyone at NASA

assumed we'd be standing down from the

launch for a few weeks. The usual plan

would then be to replace the entire

engine. What if we just cut the skirt?

Elon said, like literally cut around it.

Why not just trim off a tiny bit of the

bottom that had the two cracks using a

big pair of shears? The skirt was

trimmed and the rocket launched the next

day. It took less than an hour to make

the decision. Three more principles

combined that repeat over and over

again. Elon's anti-outsourcing, pro-ont

control, and pro- daily iteration. By

sending their factories abroad, American

companies save labor costs, but they

lost the daily feel for ways to improve

their products. Elon bucked this trend.

He wanted to have tight control of the

manufacturing process. He believed that

designing the factory to build the car,

the machine that builds the machine, was

as important as designing the car

itself. Tesla's design manufacturing

feedback loop gave it a competitive

advantage, allowing it to innovate on a

daily basis. And he has a great way of

describing why this is so important and

why this is where he spends most of his

time. Elon took on the manufacturing,

the materials, the huge factories. He

spent more time walking assembly lines

than he did walking around the design

studio. This is why. This is what he

said. The brain strain of designing the

car is tiny compared to the brain strain

of designing the factory. And then we

see over and over again he's going to

use that same idea. Make sure that your

team feels the immediate pain and

feedback of their work. When redesigning

the factory, Elon put the cubicles for

the engineers right on the edge of the

assembly lines so that they would see

the flashing lights and hear the

complaints whenever one of their design

elements caused a slowdown. Elon often

coraled the engineers to walk up and

down the lines with him. And he combines

that with the fact that he is going to

demand to demand to demand excellence.

So, he gets one of the first Model S's

that come off the assembly line. And he

is he's like, "This sucks." And what is

he going to do? When Elon gets angry, he

is quick to pull the trigger. So, he

gets the Model S. He thinks the product

sucks. So, he fired three production

quality chiefs in quick succession. His

focus was always on root causes. What in

the design was to blame for the

production line problem? Think about

that. You get a car off an assembly

line, you're like, what in the assembly

line caused this poor quality? He goes

all the way back to the root cause. what

in the design was to blame for the

production line problem? And so, I don't

know if Elon has any tattoos, but if he

did, I would imagine he's got the word

hardcore tattooed somewhere on his body

because that is one of his favorite

words. It's one of his favorite

concepts, this idea of hardcore. He used

it to describe the workplace culture

that he wanted. As the Model S

production line ramped up, he spelled

out his creed in an email to employees

titled Ultra Hardcore. It read, "Please

prepare yourself for a level of

intensity that is greater than anything

most of you have experienced before.

Revolutionizing industries is not for

the fate of heart." And so, this next

part is a great description of why I've

just identified this handful of

principles that you see appear over and

over again in chronological order

applied across decades in multiple

companies because everything is

connected. He's maniacal about repeating

himself. He's maniacal about

simplifying. He's maniacal about

reducing costs. He's maniacal about

deleting. He's maniacal about framing

his endeavors as having epoch making

significance. In four sentences, you see

all of these at play. Like a mountain

climber, pairing the contents of his

knapsack, Elon obsessed over reducing

the weight of his rockets that has a

multiplier effect. Removing a bit of

weight by deleting a part using a

lighter material. Making simpler welds

results in less fuel needed, which

further reduces the mass the engines

have to lift. When he walk through the

SpaceX's assembly lines, Elon would

pause at each station, stare silently,

and challenge the team to delete or trim

some part. At almost every encounter, he

maniacally hammered home the message. A

fully reusable rocket is the difference

between being a single planet

civilization and being a multilanetary

one. I think the implication of

everything that you and I are talking

about is really important. The

unrelenting application of his core

principles over decades. That is how

greatness is built. In his relentless

quest to conquer gravity, Elon kept

hammering at us to ek out a tiny percent

more efficiency. A few times when an

employee pushed back, saying it would

present challenges with valves and

leaks, Elon was unrelenting. There is no

first principles reason this cannot

work. It's extraordinarily difficult, I

know, but you have to muscle through.

Elon liked to focus on work. He treated

the rest of his life as an unpleasant

distraction. The sheer amount of time

that I spend at work was so extreme that

any relationship was very difficult to

maintain. He said SpaceX and Tesla were

difficult individually. Doing them both

at the same time was almost impossible.

So, it was all just work all of the

time. Again, Elon was not bred for

domestic tranquility.

Another one of his ideas that I think is

very interesting, and it was not obvious

to me until I went back and reread

certain parts over and over again. He

will compare the products he's building

to how things work in the natural world,

like how a gopher digs a hole or how

humans drive. So, this is the first time

I mentioned this. You'll see this a few

times. Elon resisted the use of LAR,

insisting that a self-driving system

should only use visual data from

cameras. The reason he said that is

because humans drove only using visual

data. Therefore, machines should be able

to too. He thought there was no first

principles reason that machines couldn't

drive just like humans did. And so,

you'll see this later on. Even though

what they're trying to achieve is, you

know, almost impossible, he distills it

down into a sentence that you

understand. make the car drive like we

do or dig this hole like the gopher in

my front yard does or manufacture the

bottom of a Tesla just like this toy car

does or when working on autonomy why

can't the car drive itself from my home

to work so again inventing all the

technology to actually do that is

insanely difficult but you understand

where he's trying to go to and so at

this point he's starting all these other

companies but again he just takes that

same principles that that he was using

his other companies applies them applies

them to the new companies this is an

example that a maniacal sense of urgency

is our operating princip you start now.

And he's having this conversation. Did

you ever notice that cities are built in

3D, but roads are only built in 2D? Elon

said, you could build roads in 3D by

building tunnels under cities. He said,

so he called Steve Davis, a trusted

engineer at SpaceX. That's another thing

that I need to point out to you. Because

he's running so many companies, he's

constantly taking like talent from other

companies and when there when there's

problems, he like air drops them in like

almost like a like a Navy Seal unit or

something. So here's an example. He

called Steve Davis. Now he's about to

start the Boring Company. Okay, he

called Steve Davis, a trusted engineer

at SpaceX. It was 2 a.m., but Davis

agreed to study ways to build tunnels

quickly and inexpensively. And again,

I'm going to pause here and interrupt

myself. One of the things that's obvious

if you read the book is Elon's full use

of time. It doesn't matter what day it

is, what time it is. The right time

would be right now, I guess, is the way

to think about it. So, it's 2 a.m. I'm

going to call this guy. You need to

start studying how to build tunnel

tunnels quickly and inexpensively. And

then Elon goes, "And I'll call you back

in 3 hours." Again, you start now.

Maniacal sense of urgency is our

operating principle. When Elon called

him back, Davis had figured out a few

ideas for using a standard tunneling

machine to bore a simple 40ft diameter

round hole and not have to reinforce it

with concrete. How much do these

machines cost? Elon asked. Davis told

him 5 million. Buy two of them and have

them when I get back. And so, even

though it's a new company, it's the same

Elon. He's going to go to where the work

is actually done and he's going to teach

you his algorithm. You're going to move

maniacally fast. You're going to delete.

You're going to simplify and you're

going to compare. And this is what I

mean. Elon would frequently check on the

progress. How can we move faster? What

are the impediments? He spent a lot of

time giving us lessons about the

importance of deleting steps and

simplifying. For example, they were

drilling a vertical shaft at the

beginning of the tunnel to lower in the

tunneling machine. The gopher in my yard

doesn't do that, Elon said. So they

ended up redesigning the tunneling

machine so that it could simply be aimed

nose down and start bearing into the

ground. As you can imagine, this 247

allconsuming work schedule that he

maintains is incredibly stressful. And

so there's a few times, not even a few,

there's many times where he he will zone

out even if you're around him and go

deep into thought, but many times he has

to isolate himself and that's where

he'll do his best thinking. So I'm going

to read this to you and I'm going to

read my note. And so this is what he

said. I've got to lay down. I've got to

shut off the lights. I need some time

alone. So Jim Simons, the founder of

Renaissance Technologies, okay, I read

his biography twice. The first time I

read it was like 5 years ago. The idea

that he used in that book is one of the

most effective ideas I've ever found in

a book because I started using it since

then. So what Jim Simons would do, he

would lay down in the dark in silence,

no stimuli at all, and think through

problems. Elon does the same. And it's

interesting. He says, "I've got to shut

off the lights." So, what I learned from

Jim Simons is you lay flat, you know, on

a couch or on the bed and on the floor.

It has to be completely silent. I put in

like little soft like foam uh earplugs

and then I put a sleep mask on so I

can't hear or see anything. I don't try

to control my thoughts. I just listen to

my mind. And because you have no stimuli

for 20, 30 minutes, an hour, however

long you do this, it's remarkable how

you find solutions to something you're

thinking about and then how energized

you feel after that. And there's some

examples later in the book where Elon

will sit silently staring at the wall

for an entire night. So, let's go back

to his desire. Remember, I am wired for

war. I think he likes chaos. I think

when things are going well, it it it's

not he's just not suited for that. He

wants to be hardcore all the time. So,

this is when they're ramping up

production. They have to build 5,000

Model 3s per week or they die. The major

challenge for us over the next six to

nine months is how do we build a huge

number of cars? Frankly, we're going to

be in production hell. This is Elon

talking to his employees. He told all of

his employees, "I look forward to

working alongside you, journeying

through hell." As the saying goes, if

you're going through hell, just keep

going. And again, we see amazing how

consistent even when he's on the

precipice of death, on the precipice of

bankruptcy, how consistent his operating

principles are, big goals, tight

deadlines, up to the edge of bankruptcy,

him living at the company until the job

is done with constant repetition of

their organizing principle in an easy to

understand way. And so, in this case, he

distills it down. 5,000 cars a week or

we're dead. Elon had one primary focus,

ramping up production so that Tesla was

turning out 5,000 Model 3s per week. He

had done the calculations of the

company's costs, overhead, and cash

flow. If it hit that rate, Tesla would

survive. If not, it would run out of

money. He repeated like a mantra,

there's that word again, to every

executive, and he installed monitors at

the factory showing the up totheminute

output of cars and components. Elon

decided he had to move himself literally

into the factory floor and lead an

all-in search. And he expects you to

work just like he does. He will never

ask you to do something he's not doing,

but he expects you to do this. He he

calls up one of uh his employees and he

says, "Hey, meet me at the Van Ny

airirstrip in an hour. We flew to Reno

and I end up staying there for four

months." The way I describe what just

happened when now. And so this is when

he's starting to develop and really

refine the algorithm, which is again I

think the probably the most important

idea in the entire book. I'm going to

read you my note first. Find the

bottleneck. Keep asking why until you

get to the root cause. Then delete and

simplify. You don't have to be a genius

to do this. You just have to constantly

apply these ideas over a long period of

time. They go against human nature, even

for smart people. Our nature is to over

complicate and go along with the flow.

What do I mean by that? Elon noticed the

assembly line was being slowed at a

station where strips of fiberglass were

glued to the battery packs by an

expensive but slow robot. I realized

that the first error was trying to

automate the process, which was my fault

because I pushed for a lot of

automation, he says. Elon asked a basic

question. What the hell are these strips

for? The engineering team told him that

it had been specified by the noise

reduction team to cut down on

vibrations. So Elon called the noise

reduction team which told him that the

specification came from the engineering

team to reduce the risk of fire. It was

like being in a Dilbert cartoon, Elon

says. So he ordered them to record the

sound inside the car without the

fiberglass and then with the fiberglass.

See if you can tell the difference, he

told them. They couldn't. Step one

should be to question the requirements.

Elon said, make them less wrong and dumb

because all requirements are somewhat

wrong and dumb. And then delete, delete,

delete. The same approach worked even on

the smallest details. For example, when

the battery packs were completed in

Nevada, little plastic caps were put on

the prongs that would plug it into the

car. When the battery got to the Fremont

factory, the plastic caps were removed

and discarded. Sometimes they would run

out of caps in Nevada and have to hold

up shipment for the batteries. When Elon

asked why the caps existed, he was told

that they had been specified to make

sure the pins did not get bent. Who

specified that requirement? He said the

factory team scrambled to find out, but

they weren't able to come up with a

name. So, delete them. Elon said they

did, and it turned out that they never

had a problem with bent pins. So, I

think those two stories are a great

example of why he's just saying you have

to constantly question requirements and

you're going to be surprised at how much

you can delete and simplify. And so, as

you can imagine, as he's going through

production hell, he's also firing a lot

of people. And so, he repeats himself

here. By trying to be nice to people,

you're actually not being nice to the

dozens of other people who are doing

their jobs well and will get hurt if I

don't fix the problem spots.

So if you remember earlier when we were

talking about the fact that the most

successful people also have the most

failures and the great thing is you see

all these examples of Elon making a

decision that he'll come to regret

later. So he's constantly learning and

updating it. So he was obsessed with

automation. This is when he starts

updating the Elon algorithm and he goes

all in on dea. And there's probably 300

pages left in the book from where we are

and he's just relentless about this.

This is excessively excessively

important to him. one of the most

important ideas that he learned and it

came 25 years into his career. So he

said we had this enormously automated

production line that used tons of

robots. There was one problem. It didn't

work. Elon flipped from being an apostle

of automation to a new mission that he

pursued with similar zeal. Find any part

of the line where there was a holdup and

see if deautomation would make it go

faster. We began sawing robots out of

the production line and throwing them

into the parking lot. We had to put a

hole in the side of the building just to

remove all the equipment. Elon said the

experience became a lesson that would

become part of Elon's production

algorithm. Always wait until the end of

designing a process after you have

questioned all the requirements and

deleted unnecessary parts before you

introduce automation. And so we see

another one of his great ideas. You need

to have an easy way to see data that

allows you to identify a problem. And

then once you do, you need to get your

ass straight to that problem. So he

calls this walk to the red. There was a

monitor that showed each station on the

assembly line with a green or red light

indicating whether it was flowing

properly. So Elon was able to walk the

floor and hone in on the trouble spots.

He called this walking to the red. He

would head he would head straight to any

red light he saw. What's the problem? A

part was missing. Well, who's in charge

of the part? Get him over here. A sensor

keeps tripping. Who calibrated it? find

someone who can open the console. Can we

adjust the settings? Why do we even need

that [ __ ] sensor? Elon would then

resume his procession through the

factory looking for the red lights. And

so he's just constantly questioning

things and trying to find limit. Why do we have to have four bolts there? Who

we have to have four bolts there? Who set that specification? Can we do it

set that specification? Can we do it with two? They would say no. Well, try

with two? They would say no. Well, try it. See if it fails. And then on and on

it. See if it fails. And then on and on and on. He just moves down the line. So

and on. He just moves down the line. So this is the what I mentioned earlier.

this is the what I mentioned earlier. you you need to be decisive or you're

you you need to be decisive or you're going to be dead. Elon calculated that

going to be dead. Elon calculated that he made a 100 command decisions a day as

he made a 100 command decisions a day as he walked the floor. At least 20% are

he walked the floor. At least 20% are going to be wrong, he said, and we're

going to be wrong, he said, and we're going to alter them later. But if I

going to alter them later. But if I don't make decisions, we die.

don't make decisions, we die. He then turns it into a game. Elon

He then turns it into a game. Elon started walking the conveyor line,

started walking the conveyor line, wielding a can of orange spray paint. Go

wielding a can of orange spray paint. Go or stay? He'd ask his vice president of

or stay? He'd ask his vice president of engineering. If the answer was go, the

engineering. If the answer was go, the robot would be marked with an orange X

robot would be marked with an orange X and workers would tear it off the line.

and workers would tear it off the line. Elon took responsib This is another

Elon took responsib This is another thing he does over and over again. He

thing he does over and over again. He accepts full responsibility and blame.

accepts full responsibility and blame. Elon took responsibility for the over

Elon took responsibility for the over automation. He even announced it

automation. He even announced it publicly. Excessive automation at Tesla

publicly. Excessive automation at Tesla was a mistake. To be precise, my

was a mistake. To be precise, my mistake. Humans are underrated.

mistake. Humans are underrated. And so, they're still in production

And so, they're still in production hell. They still have not hit the goal

hell. They still have not hit the goal that would keep Tesla alive, which is we

that would keep Tesla alive, which is we have to make 5,000 Model 3s a week. Now,

have to make 5,000 Model 3s a week. Now, one of the most fascinating things that

one of the most fascinating things that I've already said once to you, but I

I've already said once to you, but I think will keep being more and more

think will keep being more and more obvious as we go through this, is that

obvious as we go through this, is that Elon takes lessons from everything

Elon takes lessons from everything around him. How humans use eyes to

around him. How humans use eyes to drive, how gophers dig holes, how toys

drive, how gophers dig holes, how toys are manufactured. He will get countless

are manufactured. He will get countless ideas from science fiction books, from

ideas from science fiction books, from science fiction games and movies. He

science fiction games and movies. He will also take examples from history. He

will also take examples from history. He loves military history and he will apply

loves military history and he will apply that to car production. Elon likes

that to car production. Elon likes military history. He recounted a story

military history. He recounted a story about World War II. When the government

about World War II. When the government needed to rush the making of bombers, it

needed to rush the making of bombers, it set up production lines in the parking

set up production lines in the parking lots of the aerospace companies in

lots of the aerospace companies in California. Start building a huge tent

California. Start building a huge tent in the parking lot, he said. Just 3

in the parking lot, he said. Just 3 weeks after Elon came up with the idea,

weeks after Elon came up with the idea, the new assembly line was rolling Model

the new assembly line was rolling Model 3 sedans out of a makeshift tent in

3 sedans out of a makeshift tent in Tesla's parking lot. And then he says

Tesla's parking lot. And then he says one of the best lines in the book

one of the best lines in the book describing this. If conventional

describing this. If conventional thinking makes your mission impossible,

thinking makes your mission impossible, then unconventional thinking is

then unconventional thinking is necessary.

necessary. A few weeks later, Tesla starts

A few weeks later, Tesla starts manufacturing 5,000 cars a week.

manufacturing 5,000 cars a week. And that brings us to what I think is

And that brings us to what I think is the most important part of this entire

the most important part of this entire book, Elon's algorithm. At any given

book, Elon's algorithm. At any given production meeting, there is a

production meeting, there is a non-trivial chance that Elon will in

non-trivial chance that Elon will in tone like a mantra what he calls the

tone like a mantra what he calls the algorithm. It was shaped by the lessons

algorithm. It was shaped by the lessons he learned during the production hell

he learned during the production hell surges at the Nevada and Fremont

surges at the Nevada and Fremont factories. His executives sometimes move

factories. His executives sometimes move their lips and mouth the words. I would

their lips and mouth the words. I would argue that rep, you know, I told you

argue that rep, you know, I told you over and over again that repetition is

over and over again that repetition is persuasive. If your executives and your

persuasive. If your executives and your the other leaders on your team don't

the other leaders on your team don't already know what you're about to say,

already know what you're about to say, you're not saying it enough. And I think

you're not saying it enough. And I think Elon would agree with me because listen

Elon would agree with me because listen to what Elon says. I became a broken

to what Elon says. I became a broken record on the algorithm. I think it's

record on the algorithm. I think it's helpful to say it to an annoyingly

helpful to say it to an annoyingly degree. So, we're going to go run

degree. So, we're going to go run through this and then we're going to run

through this and then we're going to run some auditions to the algorithm. The

some auditions to the algorithm. The algorithm had five commandments. Number

algorithm had five commandments. Number one, question every requirement. Each

one, question every requirement. Each should come with the name of the person

should come with the name of the person who made it. You should never accept

who made it. You should never accept that a requirement came from a

that a requirement came from a department such as the legal department

department such as the legal department or the safety department. You need to

or the safety department. You need to know the name of the real person who

know the name of the real person who made the requirement. then you should

made the requirement. then you should question it no matter how smart that

question it no matter how smart that person is. Requirements from smart

person is. Requirements from smart people are the most dangerous because

people are the most dangerous because people are less likely to question them.

people are less likely to question them. Always do so even if the requirement

Always do so even if the requirement came from me. Then you need to make the

came from me. Then you need to make the requirements less dumb. Number two,

requirements less dumb. Number two, delete any part of the process you can.

delete any part of the process you can. You may have to add them back later. In

You may have to add them back later. In fact, if you do not end up adding back

fact, if you do not end up adding back at least 10% of them, then you didn't

at least 10% of them, then you didn't delete enough.

delete enough. Number three, simplify and organize.

Number three, simplify and organize. This should come after step two. A

This should come after step two. A common mistake is to simplify and

common mistake is to simplify and optimize a part or a process that should

optimize a part or a process that should never exist. Number four, accelerate

never exist. Number four, accelerate cycle time. Every process can be sped

cycle time. Every process can be sped up, but only do this after you followed

up, but only do this after you followed the first three steps. In the Tesla

the first three steps. In the Tesla factory, I mistakenly spent a lot of

factory, I mistakenly spent a lot of time accelerating processes that I later

time accelerating processes that I later realized should have been deleted.

realized should have been deleted. Number five, automate. This comes last.

Number five, automate. This comes last. The big mistake in Nevada and at Fremont

The big mistake in Nevada and at Fremont was that it began by trying to automate

was that it began by trying to automate every step. We should have waited until

every step. We should have waited until all the requirements had been

all the requirements had been questioned, parts and processes deleted,

questioned, parts and processes deleted, and the bugs were shaken out. So,

and the bugs were shaken out. So, there's a few other additional ideas

there's a few other additional ideas that are related and accompany the

that are related and accompany the algorithm. These are I consider these

algorithm. These are I consider these like the postcripts to the algorithm.

like the postcripts to the algorithm. Number one, all technical managers must

Number one, all technical managers must have hands-on experience. For example,

have hands-on experience. For example, managers of software teams must spend at

managers of software teams must spend at least 20% of their time coding. Solar

least 20% of their time coding. Solar roof managers must spend time on the

roof managers must spend time on the roofs doing installations. Otherwise,

roofs doing installations. Otherwise, they are like a calvary leader who can't

they are like a calvary leader who can't ride a horse or a general who can't use

ride a horse or a general who can't use a sword. Number two, camaraderie is

a sword. Number two, camaraderie is dangerous. It makes it hard for people

dangerous. It makes it hard for people to challenge each other's work. There's

to challenge each other's work. There's a tendency to not want to throw a

a tendency to not want to throw a colleague under the bus. That needs to

colleague under the bus. That needs to be avoided. Number three, it's okay to

be avoided. Number three, it's okay to be wrong, just don't be confident and

be wrong, just don't be confident and wrong. Number four, never ask your

wrong. Number four, never ask your troops to do something you're not

troops to do something you're not willing to do. Number five, whenever

willing to do. Number five, whenever there are problems to solve, don't just

there are problems to solve, don't just meet with your managers. Do a skip level

meet with your managers. Do a skip level where you meet with the level right

where you meet with the level right below your managers. You'll see many

below your managers. You'll see many times Elon just goes to the people

times Elon just goes to the people actually doing the actual work. Number

actually doing the actual work. Number six, when hiring, look for people with

six, when hiring, look for people with the right attitude. Skills can be

the right attitude. Skills can be taught. Attitude change requires a brain

taught. Attitude change requires a brain transplant.

transplant. Seven, a maniacal sense of urgency is

Seven, a maniacal sense of urgency is our operating principle. Eight, the only

our operating principle. Eight, the only rules are the ones dictated by the laws

rules are the ones dictated by the laws of physics. Everything else is a

of physics. Everything else is a recommendation.

recommendation. And so, as you can imagine, many of

And so, as you can imagine, many of Elon's top executives fled during the

Elon's top executives fled during the 2018 production hell. Elon is not

2018 production hell. Elon is not sentimental about people leaving. He

sentimental about people leaving. He likes fresh blood. He is more concerned

likes fresh blood. He is more concerned with a phenomenon he calls phoning in

with a phenomenon he calls phoning in rich. Meaning people who have worked at

rich. Meaning people who have worked at the company for a long time and because

the company for a long time and because they have enough money in vacation homes

they have enough money in vacation homes no longer hunger to stay all night on

no longer hunger to stay all night on the factory floor. So Elon likes fresh

the factory floor. So Elon likes fresh blood. If he's focused on a particular

blood. If he's focused on a particular thing, he will not get stimulation nor

thing, he will not get stimulation nor consume any inputs from the outside.

consume any inputs from the outside. Stuff can be right in front of his eyes

Stuff can be right in front of his eyes and he won't see it. So he can be lost

and he won't see it. So he can be lost deep in thought and not receive outside

deep in thought and not receive outside stimuli. I've only read that to you

stimuli. I've only read that to you maybe a handful of times. It's in the

maybe a handful of times. It's in the book over and over and over again. But I

book over and over and over again. But I think you get it by now. Here's another

think you get it by now. Here's another thing. Laws can be changed. If you think

thing. Laws can be changed. If you think laws can be changed, that's just another

laws can be changed, that's just another way of saying question every

way of saying question every requirement. Elon was allergic to joint

requirement. Elon was allergic to joint ventures. He did not share control.

ventures. He did not share control. Well, Tesla had a big challenge. How are

Well, Tesla had a big challenge. How are we going to manufacture in China?

we going to manufacture in China? Because at the time, the Chinese

Because at the time, the Chinese government insisted that you have to do

government insisted that you have to do a joint venture. But Elon was resistant

a joint venture. But Elon was resistant to have Tesla form a joint venture.

to have Tesla form a joint venture. Every other car company though had done

Every other car company though had done just that. So, he had to convince

just that. So, he had to convince China's top leaders to change a law that

China's top leaders to change a law that had defined Chinese manufacturing growth

had defined Chinese manufacturing growth for three decades. So month after month

for three decades. So month after month after month, they lobbyed the Chinese

after month, they lobbyed the Chinese government. China finally agreed in 2018

government. China finally agreed in 2018 to let Tesla build a factory without

to let Tesla build a factory without having to enter a joint venture. Again,

having to enter a joint venture. Again, that's another example of question every

that's another example of question every requirement. Go back to this idea that a

requirement. Go back to this idea that a maniacal sense of urgency is our

maniacal sense of urgency is our operating principle. Well, what what

operating principle. Well, what what does Elon do if you move too slow? One

does Elon do if you move too slow? One Sunday night, without much warning, Elon

Sunday night, without much warning, Elon flew to Seattle to fire the entire top

flew to Seattle to fire the entire top Starlink team. He brought with him eight

Starlink team. He brought with him eight of his most senior SpaceX rocket

of his most senior SpaceX rocket engineers. None of them knew much about

engineers. None of them knew much about satellites, but they all knew how to

satellites, but they all knew how to solve engineering problems and apply

solve engineering problems and apply Elon's algorithm. They threw away the

Elon's algorithm. They threw away the existing design and started back at

existing design and started back at first principles level and questioned

first principles level and questioned every requirement based on fundamental

every requirement based on fundamental physics. Another thing that you'll see

physics. Another thing that you'll see Elon do and over again, we have to find

Elon do and over again, we have to find the limit. Let's find the limit. I'm

the limit. Let's find the limit. I'm going I want to delete as much as

going I want to delete as much as possible and we can't do that unless we

possible and we can't do that unless we find the limit. So, it says SpaceX

find the limit. So, it says SpaceX contracted with a company that erected

contracted with a company that erected stainless steel water towers. Elon

stainless steel water towers. Elon talked to the workers, so those actually

talked to the workers, so those actually doing the welding, not the company

doing the welding, not the company executives, the people doing the

executives, the people doing the welding, and he's asking them, "Well,

welding, and he's asking them, "Well, what do you think is safe?" He's asking

what do you think is safe?" He's asking like, "How thin can we make these

like, "How thin can we make these walls?" And one of Elon's rules is go as

walls?" And one of Elon's rules is go as close to the source as possible for

close to the source as possible for information. So, the line workers said

information. So, the line workers said that they thought the tank walls could

that they thought the tank walls could get as thin as 4.8 mm. "I think you

get as thin as 4.8 mm. "I think you already know what Elon's going to say

already know what Elon's going to say here." "What about four?" Elon asked.

here." "What about four?" Elon asked. "That would make us pretty nervous," one

"That would make us pretty nervous," one of the workers replied. "Okay," Elon

of the workers replied. "Okay," Elon said. Let's do four millimeters. Let's

said. Let's do four millimeters. Let's give it a try. It worked. And again, I

give it a try. It worked. And again, I think what he's doing there, he's like,

think what he's doing there, he's like, well, I know one of my principles. I

well, I know one of my principles. I want to delete as much as possible. I

want to delete as much as possible. I think he says the best part is no part

think he says the best part is no part later on. So, I want to delete as much

later on. So, I want to delete as much as possible. I can't do that unless I

as possible. I can't do that unless I actually know where the limit is. I have

actually know where the limit is. I have to find the line. And I think the fact

to find the line. And I think the fact that I've spent, I don't know, 10 days

that I've spent, I don't know, 10 days now like in in in Elon's brain thinking

now like in in in Elon's brain thinking about this, rereading everything,

about this, rereading everything, editing it down, deleting. I think my

editing it down, deleting. I think my own personal takeaway is stop thinking

own personal takeaway is stop thinking that you have limits.

that you have limits. Stop giving into imaginary delays. And I

Stop giving into imaginary delays. And I think one of the smartest ways that Elon

think one of the smartest ways that Elon teaches that is just like just start

teaches that is just like just start with whatever you have in front of you.

with whatever you have in front of you. Whatever is available right now and go

Whatever is available right now and go resist your innate urge to over

resist your innate urge to over complicate things. Elon became

complicate things. Elon became frustrated at the slow pace. The crew

frustrated at the slow pace. The crew had still not even made one dome that

had still not even made one dome that would fit perfectly on Starship. He

would fit perfectly on Starship. He issued a challenge. Build a dome by

issued a challenge. Build a dome by dawn. That was not feasible, he was

dawn. That was not feasible, he was told, because they didn't have the

told, because they didn't have the equipment to calibrate the precise size.

equipment to calibrate the precise size. This is what Elon said when he heard

This is what Elon said when he heard that. We're gonna make a dome by dawn if

that. We're gonna make a dome by dawn if it [ __ ] kills us. Slice off the end

it [ __ ] kills us. Slice off the end of that rocket barrel and use that as

of that rocket barrel and use that as your fitting tool. They did so and he

your fitting tool. They did so and he This is This is key though. He stays

This is This is key though. He stays there with them. He's in the factories.

there with them. He's in the factories. He's on the roofs. He's under the cars.

He's on the roofs. He's under the cars. They did so and he stayed with the team

They did so and he stayed with the team of four engineers and welders until the

of four engineers and welders until the dome was finished. We didn't actually

dome was finished. We didn't actually have a dome by dawn. It took us until

have a dome by dawn. It took us until about 900 a.m. Stop thinking you have

about 900 a.m. Stop thinking you have limits. Stop giving into imaginary

limits. Stop giving into imaginary delays. Start with whatever you have in

delays. Start with whatever you have in front of you. Whatever is available to

front of you. Whatever is available to you right now and go resist the urge to

you right now and go resist the urge to over complicate. Elon sat this is again

over complicate. Elon sat this is again it's it's fascinating to me. Long time

it's it's fascinating to me. Long time spent in silent thought. This is the

spent in silent thought. This is the opposite of our modern world, right? He

opposite of our modern world, right? He he spent an insane amount of time in

he spent an insane amount of time in silent thought. Elon sat upright on the

silent thought. Elon sat upright on the edge of his bed next to Grimes. This was

edge of his bed next to Grimes. This was his girlfriend at the time. Unable to

his girlfriend at the time. Unable to sleep. Some nights he did not move until

sleep. Some nights he did not move until dawn. One night he left the light on and

dawn. One night he left the light on and just stared into space silently. Every

just stared into space silently. Every couple of hours I would wake up and he

couple of hours I would wake up and he was just still sitting there completely

was just still sitting there completely still in the thinking man statue pose.

still in the thinking man statue pose. Just completely silent on the edge of

Just completely silent on the edge of the bed. And so this next part I've

the bed. And so this next part I've already mentioned a few times, but I

already mentioned a few times, but I didn't tell you how he actually did

didn't tell you how he actually did this. He has this really interesting

this. He has this really interesting appreciation for the toy industry and

appreciation for the toy industry and then he's just got this relentless

then he's just got this relentless dedication to questioning requirements

dedication to questioning requirements and working from first principles. Elon

and working from first principles. Elon was playing with a toy version of the

was playing with a toy version of the Model S. He noticed that the entire

Model S. He noticed that the entire underbody of the car had been diecast as

underbody of the car had been diecast as one piece of metal. Why can't we do

one piece of metal. Why can't we do that? One of his engineers pointed out

that? One of his engineers pointed out that there's no casting machines to

that there's no casting machines to handle something that size. That answer

handle something that size. That answer did not satisfy Elon. Go figure out how

did not satisfy Elon. Go figure out how to do it. Ask for a bigger casting

to do it. Ask for a bigger casting machine. It's not as if this would break

machine. It's not as if this would break the laws of physics. They then called

the laws of physics. They then called six major casting companies and five of

six major casting companies and five of them dismissed the concept. But one

them dismissed the concept. But one company agreed to take on the challenge

company agreed to take on the challenge and built the world's largest casting

and built the world's largest casting machine. The process reinforced Elon's

machine. The process reinforced Elon's appreciation for the toy industry. "They

appreciation for the toy industry. "They have to produce things very quickly and

have to produce things very quickly and cheaply without flaws and manufacture

cheaply without flaws and manufacture them all by Christmas or there will be

them all by Christmas or there will be sad faces," he said. He repeatedly

sad faces," he said. He repeatedly pushed his teams to get ideas from toys

pushed his teams to get ideas from toys such as robots and Legos. He spoke about

such as robots and Legos. He spoke about the high precision molding of Lego

the high precision molding of Lego pieces. They are accurate and identical

pieces. They are accurate and identical to within 10 microns of each other which

to within 10 microns of each other which means any part can be easily replaced by

means any part can be easily replaced by another. Car components should be that

another. Car components should be that way. Precision is not expensive. Elon

way. Precision is not expensive. Elon said it is mostly about caring. Do you

said it is mostly about caring. Do you care to make it precise? Then you can

care to make it precise? Then you can make it precise. And so we see another

make it precise. And so we see another quick story combines a bunch of these

quick story combines a bunch of these operating principles. The fact that

operating principles. The fact that you're going to maintain a mathematical

you're going to maintain a mathematical sense of urgency. You're going to work

sense of urgency. You're going to work all the hours. You're going to be

all the hours. You're going to be hardcore. you will move into the Elon

hardcore. you will move into the Elon will move into the company and that he

will move into the company and that he insists on being a frontline general. He

insists on being a frontline general. He has a great quote about this later. Elon

has a great quote about this later. Elon feared complacency. Unless he maintained

feared complacency. Unless he maintained a maniacal sense of urgency, SpaceX

a maniacal sense of urgency, SpaceX could end up flabby and slow. He paid a

could end up flabby and slow. He paid a late night visit to pad 39A, which a

late night visit to pad 39A, which a launchpad. There were only two people

launchpad. There were only two people working. He expected everyone to work

working. He expected everyone to work with an unrelenting intensity. We have

with an unrelenting intensity. We have 783 employees working at the Cape, he

783 employees working at the Cape, he said in a cold rage. Why are there only

said in a cold rage. Why are there only two of them working now? He went into

two of them working now? He went into hardcore allin mode. He moved into the

hardcore allin mode. He moved into the hanger at Cape Canaveral and went to

hanger at Cape Canaveral and went to work around the clock. And so Elon has

work around the clock. And so Elon has that intense desire to work manically

that intense desire to work manically hard. And one way to make sure that

hard. And one way to make sure that everybody around him has that, he

everybody around him has that, he doesn't delegate the hiring decisions.

doesn't delegate the hiring decisions. And so at this point in SpaceX history,

And so at this point in SpaceX history, he's still interviewing every engineer

he's still interviewing every engineer hired. And so it says when hiring or

hired. And so it says when hiring or promoting, he made a point of

promoting, he made a point of prioritizing attitude over resume. And

prioritizing attitude over resume. And his definition of a good attitude was a

his definition of a good attitude was a desire to work maniacally hard. And so

desire to work maniacally hard. And so he's constantly bringing in new people,

he's constantly bringing in new people, but he will also remember he's like, I'm

but he will also remember he's like, I'm worried about people phoning in rich. He

worried about people phoning in rich. He will also push old people out. He is

will also push old people out. He is remorseless. He is mission first. So he

remorseless. He is mission first. So he is sending an email. He's going to wind

is sending an email. He's going to wind up pushing out one of the first

up pushing out one of the first engineers that worked on SpaceX. This

engineers that worked on SpaceX. This guy worked there for 18 years. Remember

guy worked there for 18 years. Remember he said that camaraderie is dangerous.

he said that camaraderie is dangerous. It makes it hard for people to challenge

It makes it hard for people to challenge each other's work. there's a tendency to

each other's work. there's a tendency to not want to throw a colleague under the

not want to throw a colleague under the bus and that you should be avoiding it.

bus and that you should be avoiding it. So, he sends this email to this guy

So, he sends this email to this guy that's been working with him for 18

that's been working with him for 18 years. You did an awesome job over many

years. You did an awesome job over many years, but eventually everyone's time

years, but eventually everyone's time comes to retire. Yours is now back to

comes to retire. Yours is now back to Elon comparing his work to other

Elon comparing his work to other industries again and being easy to

industries again and being easy to understand. Rocket should be like

understand. Rocket should be like airplanes. They should take off, land,

airplanes. They should take off, land, and then take off again as soon as

and then take off again as soon as possible. Another repeated saying of

possible. Another repeated saying of Elon's, the best part is no part.

Elon's, the best part is no part. Delete, delete, delete. Remember, we're

Delete, delete, delete. Remember, we're working through this book in

working through this book in chronological order. The repetition is

chronological order. The repetition is intentional. Do not get too close to

intentional. Do not get too close to your employees. Emotions blur judgment.

your employees. Emotions blur judgment. Camaraderie is dangerous. Elon began

Camaraderie is dangerous. Elon began with a lecture on collegiality. I want

with a lecture on collegiality. I want to be super clear. You are not a friend

to be super clear. You are not a friend of the engineers. You are the judge. If

of the engineers. You are the judge. If you're popular among your engineers,

you're popular among your engineers, this is bad. If you don't step on toes,

this is bad. If you don't step on toes, I will fire you. Is that clear? And Elon

I will fire you. Is that clear? And Elon is absolutely unrelenting. You must know

is absolutely unrelenting. You must know your area of the company down to the

your area of the company down to the ground. So he's going to quiz you on the

ground. So he's going to quiz you on the idiot index. If the ratio is high, you

idiot index. If the ratio is high, you are an idiot. He's going to drill his

are an idiot. He's going to drill his employees on this. So he says, "What are

employees on this. So he says, "What are the best parts in Raptor as judged by

the best parts in Raptor as judged by the idiot index?" He's talking to this

the idiot index?" He's talking to this guy named Hughes. I'm not sure. I will

guy named Hughes. I'm not sure. I will find out. Elon says, "You better [ __ ]

find out. Elon says, "You better [ __ ] be sure in the future that you know

be sure in the future that you know these things off the top of your head.

these things off the top of your head. If you ever come into a meeting and do

If you ever come into a meeting and do not know what the idiot parts are, then

not know what the idiot parts are, then your resignation will be accepted

your resignation will be accepted immediately. How the [ __ ] can you not

immediately. How the [ __ ] can you not know what the best and the worst parts

know what the best and the worst parts are?

are? He continues, "What are the five worst

He continues, "What are the five worst parts?" Hugh says, "There is the half

parts?" Hugh says, "There is the half nozzle jacket. I think it costs

nozzle jacket. I think it costs $13,000."

$13,000." Elon replies, "It's made of a single

Elon replies, "It's made of a single piece of steel. How much does that

piece of steel. How much does that material cost?" Hughes responds, "I

material cost?" Hughes responds, "I think a few thousand." Elon, of course,

think a few thousand." Elon, of course, because he's obsessed, maniacal about

because he's obsessed, maniacal about costs, he knows the answer. No, it's

costs, he knows the answer. No, it's just steel. It's 200 bucks. If you don't

just steel. It's 200 bucks. If you don't improve, your resignation will be

improve, your resignation will be accepted. And so, after this happened,

accepted. And so, after this happened, the author is asking him like, don't you

the author is asking him like, don't you think you were too harsh with this guy?

think you were too harsh with this guy? And Elon's response was, I give people

And Elon's response was, I give people hardcore feedback. I try to criticize

hardcore feedback. I try to criticize the action, not the person. Physics does

the action, not the person. Physics does not care about hurt feelings. It cares

not care about hurt feelings. It cares about whether you got the rocket right.

about whether you got the rocket right. And then we see more repetition on

And then we see more repetition on repetition. Repetition is persuasive.

repetition. Repetition is persuasive. You are not repeating yourself enough.

You are not repeating yourself enough. You have to say it again. Elon often

You have to say it again. Elon often repeats himself in meetings. He wants to

repeats himself in meetings. He wants to know that you've listened. His employees

know that you've listened. His employees learn to repeat his feedback. And one of

learn to repeat his feedback. And one of these things that he repeats is you need

these things that he repeats is you need to be a frontline general. You have to

to be a frontline general. You have to stay as close to the work as possible.

stay as close to the work as possible. He he loves being a battlefield general

He he loves being a battlefield general on the front lines. He repeats it over

on the front lines. He repeats it over and over again. He's going to reference

and over again. He's going to reference Napoleon in a little bit. But what he

Napoleon in a little bit. But what he says is when Elon asked him how many

says is when Elon asked him how many solar roofs he installed, Tony explained

solar roofs he installed, Tony explained he was an engineer and had not actually

he was an engineer and had not actually been doing had not actually been on the

been doing had not actually been on the roof doing the installation. Then you

roof doing the installation. Then you don't [ __ ] know what you're [ __ ]

don't [ __ ] know what you're [ __ ] talking about, Elon said. That's why

talking about, Elon said. That's why your roofs are [ __ ] and take so long to

your roofs are [ __ ] and take so long to install. So then this guy spends the

install. So then this guy spends the entire next day installing roofs. And

entire next day installing roofs. And then what Elon will do too is if

then what Elon will do too is if something's important, he sees a

something's important, he sees a problem, he will make sure that you're

problem, he will make sure that you're meeting about that problem every 24

meeting about that problem every 24 hours, him with him until it's fixed.

hours, him with him until it's fixed. And so just making this engineer install

And so just making this engineer install the roofs was a very valuable form of

the roofs was a very valuable form of education for the engineer. So even

education for the engineer. So even within the next 24 hours that the the

within the next 24 hours that the the next meeting they had went a lot better.

next meeting they had went a lot better. And then he makes sure that the guy

And then he makes sure that the guy keeps installing you know what he said

keeps installing you know what he said 20% of the time you should actually be

20% of the time you should actually be doing the actual work. And one of the

doing the actual work. And one of the reasons this is so important is because

reasons this is so important is because they'll see the problem with the design

they'll see the problem with the design and the engineering when they actually

and the engineering when they actually try to manufacture it to make it. And

try to manufacture it to make it. And then you also notice that his adherence

then you also notice that his adherence to the mission, his dedication to the

to the mission, his dedication to the mission, it's why he's he works, you

mission, it's why he's he works, you know, maniacally hard, but it's also why

know, maniacally hard, but it's also why he has a problem with developing

he has a problem with developing personal relationships. So his his

personal relationships. So his his ex-girlfriend Grimes actually writes a

ex-girlfriend Grimes actually writes a song about him. And the song, when you

song about him. And the song, when you read the lyrics, I think it's really

read the lyrics, I think it's really illustrative of Elon as a person. It's

illustrative of Elon as a person. It's called The Player of Games. And I think

called The Player of Games. And I think the most important line in the song is,

the most important line in the song is, "He'll always love the game more than he

"He'll always love the game more than he loves me." And I think that's why a lot

loves me." And I think that's why a lot of the founders that you and I cover on

of the founders that you and I cover on the podcast and we talk about like they

the podcast and we talk about like they have such they're not bred for domestic

have such they're not bred for domestic tranquility. They have a lot of problems

tranquility. They have a lot of problems maintaining long-term relationships.

maintaining long-term relationships. And then just in this random

And then just in this random conversation he was having it was

conversation he was having it was interested to hear Elon's take on like

interested to hear Elon's take on like okay you're running all these companies

okay you're running all these companies but like what which one is actually most

but like what which one is actually most important? And he said something that

important? And he said something that was very fascinating to me. He says

was very fascinating to me. He says building mass market electric cars was

building mass market electric cars was inevitable. It would have happened

inevitable. It would have happened without me. But becoming a space fairing

without me. But becoming a space fairing civilization is not inevitable. To me,

civilization is not inevitable. To me, it's like he's saying, SpaceX is the

it's like he's saying, SpaceX is the most important. In fact, one of my

most important. In fact, one of my favorite investments firms has a very

favorite investments firms has a very simple thesis. Invest only in things

simple thesis. Invest only in things that wouldn't happen without us. If we

that wouldn't happen without us. If we don't make this investment, it's not

don't make this investment, it's not going to happen. And what's fascinating

going to happen. And what's fascinating is if you look at their portfolio, it's

is if you look at their portfolio, it's insanely highly concentrated. Tiny

insanely highly concentrated. Tiny number of bets, but those bets are

number of bets, but those bets are massive. And I love the idea of us

massive. And I love the idea of us deciding on like what what are we going

deciding on like what what are we going to work on? Like what do we want to

to work on? Like what do we want to dedicate our life to? Dedicated to

dedicate our life to? Dedicated to something that wouldn't happen without

something that wouldn't happen without you is a very interesting organizing

you is a very interesting organizing principle to me. Back to Elon's idea

principle to me. Back to Elon's idea that if we are slow, we are dead. Again,

that if we are slow, we are dead. Again, just very straightforward, clear

just very straightforward, clear thinking. It was better to try and fail

thinking. It was better to try and fail rather than analyze the issue for

rather than analyze the issue for months. If you make this thing fast, you

months. If you make this thing fast, you can find out fast and then you can fix

can find out fast and then you can fix it fast. And so at the time, he's trying

it fast. And so at the time, he's trying to drastically simplify the Raptor

to drastically simplify the Raptor engine design, which there's this great

engine design, which there's this great picture. You could just Google, you

picture. You could just Google, you know, Raptor design over time and you

know, Raptor design over time and you see the actual application of his

see the actual application of his algorithm and his simplification and his

algorithm and his simplification and his deleting. It's just absolutely

deleting. It's just absolutely beautiful. But again, it goes back to

beautiful. But again, it goes back to like if it's important, Elon's going to

like if it's important, Elon's going to do it himself. Elon interviews and picks

do it himself. Elon interviews and picks the talent himself. Elon was looking for

the talent himself. Elon was looking for someone who might be able to oversee

someone who might be able to oversee Raptor Design. So, he started having one

Raptor Design. So, he started having one on-one sessions, peppering mid-level

on-one sessions, peppering mid-level engineers with questions. After a few

engineers with questions. After a few weeks, a young engineer began to stand

weeks, a young engineer began to stand out. And when you pick the person, what

out. And when you pick the person, what does he do? He starts to teach the

does he do? He starts to teach the person. He starts to indoctrinate the

person. He starts to indoctrinate the person to the algorithm. He's going to

person to the algorithm. He's going to repeat over and over again, you you need

repeat over and over again, you you need to keep everything together so the

to keep everything together so the feedback is immediate. He says, "I

feedback is immediate. He says, "I created separate design and production

created separate design and production groups a long time ago, and that was a

groups a long time ago, and that was a [ __ ] mistake. You are responsible

[ __ ] mistake. You are responsible for the production process. You cannot

for the production process. You cannot hand this off to someone else. If the

hand this off to someone else. If the design is expensive to produce, you

design is expensive to produce, you change the design. You move your desks

change the design. You move your desks next to the assembly line." And so he

next to the assembly line." And so he says later on that the people on the

says later on that the people on the assembly line should be able to

assembly line should be able to immediately collar a designer or an

immediately collar a designer or an engineer and say why the [ __ ] did you

engineer and say why the [ __ ] did you make it this way. It goes back to that

make it this way. It goes back to that idea what he said. If your hand is on

idea what he said. If your hand is on the stove and it gets hot, you pull it

the stove and it gets hot, you pull it off right away. But if it's someone

off right away. But if it's someone else's hand on the stove, it's going to

else's hand on the stove, it's going to take you longer to do something. Which

take you longer to do something. Which goes against the fact that he says and

goes against the fact that he says and repeats adnauseium over and over again,

repeats adnauseium over and over again, a maniacal sense of urgency is our

a maniacal sense of urgency is our operating principle. And so as they're

operating principle. And so as they're working on the engine design for one of

working on the engine design for one of his rockets, he sends this giant email

his rockets, he sends this giant email with exclamation points. We are on a

with exclamation points. We are on a deletion rampage. Nothing is sacred. Any

deletion rampage. Nothing is sacred. Any remotely questionable tubes, sensors,

remotely questionable tubes, sensors, manifolds, etc. will be deleted tonight.

manifolds, etc. will be deleted tonight. I just love this quote. Please go ultra

I just love this quote. Please go ultra hardcore on deletion and simplification.

hardcore on deletion and simplification. And it's obvious he's very difficult to

And it's obvious he's very difficult to deal with, but I think this next quote

deal with, but I think this next quote un it it illustrates like why you would

un it it illustrates like why you would want to do this. And I think very few

want to do this. And I think very few people are going to be able to spend

people are going to be able to spend their life working with him. You know,

their life working with him. You know, he's turning through people. There's a

he's turning through people. There's a lot of people, especially when they're

lot of people, especially when they're in like their 20s, they do really great

in like their 20s, they do really great and they're like, "Whoa, man. I got I

and they're like, "Whoa, man. I got I need some like more balance here as I

need some like more balance here as I get older." But I just love this

get older." But I just love this description of him. It says, "I noticed

description of him. It says, "I noticed that I learned more unique lessons from

that I learned more unique lessons from Elon per minute than any other human

Elon per minute than any other human I've met. It would be dumb to not spend

I've met. It would be dumb to not spend some of your life with such a person. So

some of your life with such a person. So again, you may not be able to last

again, you may not be able to last through all this, but you're going to

through all this, but you're going to learn a hell of a lot working with them.

learn a hell of a lot working with them. And then you can use those ideas and

And then you can use those ideas and lessons for the rest of your life.

lessons for the rest of your life. Again, going back to this ultra hardcore

Again, going back to this ultra hardcore on deletion and simplification. I This

on deletion and simplification. I This sounds crazy. The very first episode I

sounds crazy. The very first episode I ever did of Founders, September 2016,

ever did of Founders, September 2016, it's a biography of Elon. I was

it's a biography of Elon. I was obviously a big fan of this guy and the

obviously a big fan of this guy and the idea for Founders came from Elon. I was

idea for Founders came from Elon. I was watching an interview in 2012 that he

watching an interview in 2012 that he did with this guy named Kevin Rose and

did with this guy named Kevin Rose and it's on the factory floor at Tesla. I

it's on the factory floor at Tesla. I think they were they had like barely

think they were they had like barely producing the Model S at the time and he

producing the Model S at the time and he was asked a question I thought was

was asked a question I thought was fascinating. He was like, you know, how

fascinating. He was like, you know, how the hell did you learn how to build

the hell did you learn how to build companies? Did you read a lot of

companies? Did you read a lot of business books? Did you have a lot of

business books? Did you have a lot of mentors? And he says, no, I didn't read

mentors? And he says, no, I didn't read business books and I didn't have any

business books and I didn't have any mentors. I looked for mentors and

mentors. I looked for mentors and historical context. And the way I did

historical context. And the way I did that is I read a lot of biographies. He

that is I read a lot of biographies. He starts naming off the biographies, Ben

starts naming off the biographies, Ben Franklin, Henry Ford, Nicola Tesla, etc.

Franklin, Henry Ford, Nicola Tesla, etc. And I was like, "Oh [ __ ] that's a

And I was like, "Oh [ __ ] that's a really good idea. I should read more

really good idea. I should read more biographies." And didn't realize that

biographies." And didn't realize that now because of that, you know, we we'll

now because of that, you know, we we'll see how it goes, but I might read more

see how it goes, but I might read more biographies anywhere else in the world.

biographies anywhere else in the world. The reason I bring that up is because

The reason I bring that up is because obviously read a lot of books on Elon.

obviously read a lot of books on Elon. I've spent a lot of time studying them.

I've spent a lot of time studying them. I don't know why something about, you

I don't know why something about, you know, the 10th book. I think this is

know, the 10th book. I think this is probably the 10th book I've read on him

probably the 10th book I've read on him or 10th time I've read a book on him. It

or 10th time I've read a book on him. It it just I didn't understand his

it just I didn't understand his evangelism and his just dedication to

evangelism and his just dedication to just simplification. I don't know why

just simplification. I don't know why that wasn't in my head before in a way

that wasn't in my head before in a way that now that idea is lodged in there

that now that idea is lodged in there like delete delete delete simplify

like delete delete delete simplify simplify simplify. This guy is in

simplify simplify. This guy is in obsessed with it. It makes perfect sense

obsessed with it. It makes perfect sense because it affects everything single

because it affects everything single everything else especially as he scales.

everything else especially as he scales. Complexity is the enemy of scaling. So

Complexity is the enemy of scaling. So it says Elon paused silently for two

it says Elon paused silently for two minutes. He's looking at I think this is

minutes. He's looking at I think this is a Neuralink device if I'm not mistaken.

a Neuralink device if I'm not mistaken. Says Elon paused silently for two

Says Elon paused silently for two minutes. Then he delivered his verdict.

minutes. Then he delivered his verdict. He hated it. It was too complex, too

He hated it. It was too complex, too many wires and connections. He was in

many wires and connections. He was in the process of deleting connections from

the process of deleting connections from SpaceX's Raptor engines. Each was a

SpaceX's Raptor engines. Each was a possible failure point. There has to be

possible failure point. There has to be a single device. Yeah, it is Neurolink.

a single device. Yeah, it is Neurolink. There has to be a single device, he told

There has to be a single device, he told the deflated Neurolink engineers. A

the deflated Neurolink engineers. A single elegant package with no wires, no

single elegant package with no wires, no connections, no router. There was no law

connections, no router. There was no law of physics that prevented all the

of physics that prevented all the functionality from being in one device.

functionality from being in one device. When engineers tried to explain the need

When engineers tried to explain the need for the router, Elon's face turned

for the router, Elon's face turned stony. And he said, "Delete, delete,

stony. And he said, "Delete, delete, delete, delete." And so I want to go

delete, delete." And so I want to go back to the fact that Elon is constantly

back to the fact that Elon is constantly learning from everything around him,

learning from everything around him, everything he experiences. He comes up

everything he experiences. He comes up with a he was obsessed with this game

with a he was obsessed with this game called Polytopia. And he comes with a

called Polytopia. And he comes with a list of Polytopia life lessons. He

list of Polytopia life lessons. He actually thinks playing the game will

actually thinks playing the game will make you a better CEO. says, "One key to

make you a better CEO. says, "One key to understanding his intensity, his focus,

understanding his intensity, his focus, his competitiveness, his diehard

his competitiveness, his diehard attitudes and love of strategy is

attitudes and love of strategy is through his passion for video games.

through his passion for video games. Hours of immersion became the way he let

Hours of immersion became the way he let off steam and honed his tactical skills

off steam and honed his tactical skills and strategic thinking for business. He

and strategic thinking for business. He became obsessed with a multiplayer

became obsessed with a multiplayer strategy game on his iPhone called

strategy game on his iPhone called Polytopia. In the game, players compete

Polytopia. In the game, players compete to develop technology, corner resources,

to develop technology, corner resources, and wage battles in order to build an

and wage battles in order to build an empire. What did his passion for the

empire. What did his passion for the game say about him?" "I am just wired

game say about him?" "I am just wired for war," he answers. Remember, he's

for war," he answers. Remember, he's been repeating that maxim for decades. I

been repeating that maxim for decades. I am wired for war. Elon told his brother

am wired for war. Elon told his brother to play Polytopia because it would teach

to play Polytopia because it would teach him how to be a CEO like he was. They

him how to be a CEO like he was. They came up with a list of Polytopia life

came up with a list of Polytopia life lessons. So, I just pulled out a couple

lessons. So, I just pulled out a couple here and put them into a list for you

here and put them into a list for you and I. Number one, empathy is not an

and I. Number one, empathy is not an asset. Number two, play life like a

asset. Number two, play life like a game. Number three, do not fear losing.

game. Number three, do not fear losing. You will lose. Elon said, it will hurt

You will lose. Elon said, it will hurt the first 50 times. When you get used to

the first 50 times. When you get used to losing, you will play each game with

losing, you will play each game with less emotion. You will be more fearless.

less emotion. You will be more fearless. Take more risks. Number four, be

Take more risks. Number four, be proactive. You will never win unless you

proactive. You will never win unless you take charge of setting the strategy.

take charge of setting the strategy. Number five, optimize every turn. In

Number five, optimize every turn. In Polytopia, you only get 30 turns, so you

Polytopia, you only get 30 turns, so you need to optimize each one. Like in

need to optimize each one. Like in Polytopia, you only get a set number of

Polytopia, you only get a set number of turns in life. If you let a few of them

turns in life. If you let a few of them slide, we will never get to Mars. Number

slide, we will never get to Mars. Number six, double down. Put everything back

six, double down. Put everything back into the game to grow and grow. And so,

into the game to grow and grow. And so, I think I've mentioned a few times that,

I think I've mentioned a few times that, you know, this is the way Elon was in

you know, this is the way Elon was in his 20s. This way he's in his 30s. I

his 20s. This way he's in his 30s. I don't think he'll ever change. I don't

don't think he'll ever change. I don't think he wants to change. But you'll

think he wants to change. But you'll have several examples in the book where

have several examples in the book where people are like, you know, just calm

people are like, you know, just calm down. You don't have to do this. And so,

down. You don't have to do this. And so, I think this is just one great example

I think this is just one great example and how he thinks about himself. So

and how he thinks about himself. So someone says to him, "You don't have to

someone says to him, "You don't have to be in a state of war at all times." And

be in a state of war at all times." And his response was, "It's part of my

his response was, "It's part of my default settings. Extended periods of

default settings. Extended periods of calm are unnerving to him." And he does

calm are unnerving to him." And he does say something that's I believe I I

say something that's I believe I I wouldn't take obviously not as intense

wouldn't take obviously not as intense as he is. And he says that life needs to

as he is. And he says that life needs to be interesting and edgy and that the way

be interesting and edgy and that the way that he wants to spend his life is heads

that he wants to spend his life is heads down focused on doing useful things for

down focused on doing useful things for civilization. Which also ties to what he

civilization. Which also ties to what he was saying earlier in the book that, you

was saying earlier in the book that, you know, we need it can't just be about

know, we need it can't just be about solving problems. like we have to be we

solving problems. like we have to be we have to do things that are inspiring. We

have to do things that are inspiring. We have to do things that even if we think

have to do things that even if we think they're they're you know semi

they're they're you know semi impossible. That spending our lives

impossible. That spending our lives working on things that inspire you and

working on things that inspire you and that are good for civilization is a life

that are good for civilization is a life well-lived. And so there's this meeting

well-lived. And so there's this meeting they're having in SpaceX that I think

they're having in SpaceX that I think combines a lot of those ideas. You know,

combines a lot of those ideas. You know, number one, work on things that inspire

number one, work on things that inspire you and they're good for civilization.

you and they're good for civilization. Number two, that you have to maintain a

Number two, that you have to maintain a maniacal search of urgency when

maniacal search of urgency when something is important has to be done

something is important has to be done quickly. He should have meetings every

quickly. He should have meetings every 24 hours to run the algorithm and then

24 hours to run the algorithm and then check on the previous day's progress.

check on the previous day's progress. That's another idea that he uses over

That's another idea that he uses over and over again. And you'll be shocked at

and over again. And you'll be shocked at actually how fast this speeds things up.

actually how fast this speeds things up. And then number three, the fact that

And then number three, the fact that Elon just frames his endeavors as having

Elon just frames his endeavors as having epoch making significance. So here's an

epoch making significance. So here's an example of that. There have to be things

example of that. There have to be things that inspire you that move your heart.

that inspire you that move your heart. Being a space fairing civilization and

Being a space fairing civilization and making science fiction not fiction is

making science fiction not fiction is one of those. As they walked him through

one of those. As they walked him through the slides, he got increasingly angry.

the slides, he got increasingly angry. These timelines are [ __ ] A mega

These timelines are [ __ ] A mega fail. Like no [ __ ] way these should

fail. Like no [ __ ] way these should take so long. He said he decreed that

take so long. He said he decreed that they would start having meetings on

they would start having meetings on Starship every night, 7 days a week. We

Starship every night, 7 days a week. We are going to go through first principles

are going to go through first principles algorithm every night questioning

algorithm every night questioning requirements and deleting. That's what

requirements and deleting. That's what we did to unfuck the [ __ ] that was

we did to unfuck the [ __ ] that was Raptor. How soon, he asked, would it

Raptor. How soon, he asked, would it take to get the booster on the launchpad

take to get the booster on the launchpad to test the engines? 10 days, he was

to test the engines? 10 days, he was told. That's too long. This is critical

told. That's too long. This is critical for all human destiny. It's hard to

for all human destiny. It's hard to change destiny. You can't do it from 9

change destiny. You can't do it from 9 to 5. And so this idea that he's going

to 5. And so this idea that he's going to move into where the problem is. He's

to move into where the problem is. He's going to be one doing the the meetings

going to be one doing the the meetings every 24 hours. He talks about the fact

every 24 hours. He talks about the fact that being a frontline general is key to

that being a frontline general is key to being effective. And this is what he

being effective. And this is what he says. If they see the general out on the

says. If they see the general out on the battlefield, the troops are going to be

battlefield, the troops are going to be motivated. Elon said, wherever Napoleon

motivated. Elon said, wherever Napoleon was, that's where his armies would do

was, that's where his armies would do best. And I think that's one of the

best. And I think that's one of the things I most admire about him. You

things I most admire about him. You know, the fact that he's on the job

know, the fact that he's on the job sites, he's in the factories, he is

sites, he's in the factories, he is leading from the front. He is

leading from the front. He is hyperfocused on the problem areas. He's

hyperfocused on the problem areas. He's actually got a great line about this I

actually got a great line about this I love. All bad news should be given

love. All bad news should be given loudly and often. Good news can be said

loudly and often. Good news can be said quietly and once. Another way that he

quietly and once. Another way that he works is if an idea worked once, he'll

works is if an idea worked once, he'll use it again later and in a different

use it again later and in a different company. So this time, I guess same

company. So this time, I guess same company but a different uh product. So

company but a different uh product. So they were building cars earlier, right?

they were building cars earlier, right? Now Tesla's building the Optimus robots.

Now Tesla's building the Optimus robots. So what does Elon do? He goes to a

So what does Elon do? He goes to a meeting and he brings a bunch of toys.

meeting and he brings a bunch of toys. It says he believed that toys could

It says he believed that toys could offer lessons. A little model car had

offer lessons. A little model car had inspired him to make real cars using big

inspired him to make real cars using big casting presses. And Legos helped him

casting presses. And Legos helped him understand the importance of precision

understand the importance of precision manufacturing. This idea worked when

manufacturing. This idea worked when making cars. It can work when we were

making cars. It can work when we were making robots. And then what does he do?

making robots. And then what does he do? He ties what they're working on to

He ties what they're working on to having epochm significance. Our goal is

having epochm significance. Our goal is to make a useful humanoid robot as

to make a useful humanoid robot as quickly as possible. This means a future

quickly as possible. This means a future of abundance, a future where there is no

of abundance, a future where there is no poverty. It really is a fundamental

poverty. It really is a fundamental transformation of civilization. And so

transformation of civilization. And so he's driving the team to develop the

he's driving the team to develop the robot as fast as possible because again,

robot as fast as possible because again, if you really believe what he is saying

if you really believe what he is saying that we have an opportunity to create a

that we have an opportunity to create a technology that will be a fundamental

technology that will be a fundamental transformation of civilization, you want

transformation of civilization, you want to get there as fast as possible. And so

to get there as fast as possible. And so he says the future will not get here

he says the future will not get here fast enough unless we force it. Again,

fast enough unless we force it. Again, that's another line that Elon repeats.

that's another line that Elon repeats. the fact that technological progress is

the fact that technological progress is not inevitable. It can stop. It can even

not inevitable. It can stop. It can even backslide. Technology only goes forward

backslide. Technology only goes forward if a lot of people work very hard to

if a lot of people work very hard to make it do so. And so then he tells the

make it do so. And so then he tells the team that's working on the robo taxi,

team that's working on the robo taxi, same thing. We are all in on autonomy.

same thing. We are all in on autonomy. This will be a historically mega

This will be a historically mega revolutionary product. It will transform

revolutionary product. It will transform everything. People will be talking about

everything. People will be talking about this moment in a hundred years. And so

this moment in a hundred years. And so again, if you believe that, what are you

again, if you believe that, what are you going to do? This is only going to work

going to do? This is only going to work if we're able to manufacture tens of

if we're able to manufacture tens of millions of these. So, I'm going to work

millions of these. So, I'm going to work with you developing the manufacturing

with you developing the manufacturing process. It says Elon spent hours each

process. It says Elon spent hours each week working with his team to design

week working with his team to design each station on the line, finding ways

each station on the line, finding ways to shave milliseconds off each step and

to shave milliseconds off each step and process. He It starts with the end in

process. He It starts with the end in mind. Might a millisecond off of this

mind. Might a millisecond off of this process might not make a difference

process might not make a difference today. It makes a hell of a big

today. It makes a hell of a big difference when we're making tens of

difference when we're making tens of millions of these things a year. don't

millions of these things a year. don't think about what we're doing as tiny

think about what we're doing as tiny improvements. They're tiny improvements

improvements. They're tiny improvements today. In reality, they're massive

today. In reality, they're massive improvements over time. And so then when

improvements over time. And so then when he buys Twitter, we see he does the

he buys Twitter, we see he does the exact same thing. He takes all these

exact same thing. He takes all these engineers. He kind of like just drops

engineers. He kind of like just drops them in from his other companies and he

them in from his other companies and he starts trying to remold the culture to

starts trying to remold the culture to how Elon likes his companies to run. If

how Elon likes his companies to run. If you could figure out I think if you're

you could figure out I think if you're like, "Hey, can I design a culture

like, "Hey, can I design a culture that's directly opposite of an Elon

that's directly opposite of an Elon company? What would that be?" It sounds

company? What would that be?" It sounds like it it was Twitter. I'm just going

like it it was Twitter. I'm just going to read a couple of this. I wrote, "Elon

to read a couple of this. I wrote, "Elon finds his complete opposite company

finds his complete opposite company culture." "Trader prided itself on being

culture." "Trader prided itself on being a friendly place where coddling was

a friendly place where coddling was considered a virtue. Everyone needs to

considered a virtue. Everyone needs to feel safe here," says Leslie Berland or

feel safe here," says Leslie Berland or Berland, who was chief marketing and

Berland, who was chief marketing and people officer. She was fired by Elon.

people officer. She was fired by Elon. Twitter has instituted had instituted a

Twitter has instituted had instituted a permanent work from home option and

permanent work from home option and allowed a mental day of rest each month.

allowed a mental day of rest each month. One of the commonly used buzzwords at

One of the commonly used buzzwords at the company was psychological safety.

the company was psychological safety. Care was taken not to discomfort. Elon

Care was taken not to discomfort. Elon laughed when he heard the phrase

laughed when he heard the phrase psychological safety. It made him

psychological safety. It made him recoil. He considered it to be the enemy

recoil. He considered it to be the enemy of urgency and progress. His preferred

of urgency and progress. His preferred word was hardcore. Discomfort, he

word was hardcore. Discomfort, he believed, was a good thing. It was a

believed, was a good thing. It was a weapon against complacency.

weapon against complacency. Vacations, flower smelling, work life

Vacations, flower smelling, work life balance, and days of mental rest were

balance, and days of mental rest were not his thing.

not his thing. And so he starts making changes to the

And so he starts making changes to the product immediately. He wants the

product immediately. He wants the explore change explore page changed. And

explore change explore page changed. And so they send a message to the engineer.

so they send a message to the engineer. Of course, the engineer is not in the

Of course, the engineer is not in the office. So they send a message to the

office. So they send a message to the engineer that was in charge of the

engineer that was in charge of the explore page. And he sent back a message

explore page. And he sent back a message saying, "I will make that fix when I get

saying, "I will make that fix when I get to the office on Monday. Do it right

to the office on Monday. Do it right now." Is what he was told. And what was

now." Is what he was told. And what was fascinating is this went on for a little

fascinating is this went on for a little bit, but the engineer actually liked

bit, but the engineer actually liked this decisiveness. He says, "We had

this decisiveness. He says, "We had worked on many possible new features for

worked on many possible new features for years, but no one ever made decisions

years, but no one ever made decisions about them. And suddenly we had this guy

about them. And suddenly we had this guy making rapid decisions. And so then Elon

making rapid decisions. And so then Elon immediately starts implementing that

immediately starts implementing that core belief that you you cannot separate

core belief that you you cannot separate engineering from product design that

engineering from product design that product design should be driven by the

product design should be driven by the engineers. And he wants his product

engineers. And he wants his product managers to understand code. He says

managers to understand code. He says product managers who don't know anything

product managers who don't know anything about coding keep ordering up features

about coding keep ordering up features they don't know how to create. This is

they don't know how to create. This is like calvary generals who don't know how

like calvary generals who don't know how to ride a horse. You must stay as close

to ride a horse. You must stay as close to the actual work as possible. Do not

to the actual work as possible. Do not separate yourself from the pain of your

separate yourself from the pain of your decisions. And remember, if a timeline

decisions. And remember, if a timeline is long, it's wrong.

And then finally, there's just a single sentence I want to end on. I think we

sentence I want to end on. I think we should keep in mind hopefully Elon has

should keep in mind hopefully Elon has decades of work in front of him. And I

decades of work in front of him. And I think it's smart for us to resist the

think it's smart for us to resist the other distractions and just hone in on

other distractions and just hone in on the company building principles that we

the company building principles that we can learn from him. And that sentence to

can learn from him. And that sentence to keep in mind is both his accomplishments

keep in mind is both his accomplishments and his failures are epic.

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How Elon Works