# What Would It Take For Elon Musk To Become The World’s First Trillionaire?

As of this writing, Elon Musk is worth more than \$ 200 billion. He is the wealthiest man in the world, surpassing Jeff Bezos by \$ 18 billion. Elon’s total assets are \$ 170 billion more than a year ago. Exactly two years ago, Tesla’s entire market cap was just \$ 53 billion. At that time, Elon was worth about \$ 25 billion. Where do you predict Elon’s total assets will be in a year? How about two years and beyond? Is it possible that Elon Musk will become the world’s first billionaire? Anything is possible! Here’s how it can happen …

When we talk about Elon Musk’s net worth, it is important to remember that his fate comes from two sources:

1) He holds a 48% stake in privately held SpaceX.

2) He holds a 20% stake in publicly traded Tesla.

When SpaceX last raised money in August 2020, it valued it at \$ 46 billion. Therefore, Elon’s 48% stake =

## \$ 22 billion

As I type this article, Tesla has a market cap of \$ 783 billion. Therefore, Elon’s 20% share =

## \$ 156 billion

But wait, \$ 156 + \$ 22 = \$ 178 billion. How is Elon currently valued at \$ 202 billion? We are “missing” 24 billion dollars!

There is a complex answer to this question. If you care for everyone, the simple answer is, here you go:

Elon’s unique bonus plan with Tesla has earned him an additional \$ 50 billion in shares. Half of them, roughly \$ 25 billion, have been approved by the board and to give net worth to what is missing in the math above =

## \$ 202 billion

The other nearly \$ 25 billion is yet to be officially confirmed and awarded by the board.

If you want complicated answers, you go here, or feel free to leave under the dash below:

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Back in 2018 Elon and Tesla boards came up with a compensation plan Elon was given a 12-level milestone bonus plan. At the time the plan was forged, Tesla had a market cap of \$ 50 billion. Each time Tesla’s market cap rose to \$ 50 billion, and stayed at that level for a sustained period, Elon was empowered to buy 1.688 million new shares of Tesla for \$ 350 per share. Installments increase by \$ 50 billion to \$ 650 billion:

If Tesla broke the \$ 650 billion market cap, the long story is that Elon was able to buy 1.688 million shares by that time for \$ 350 per share… twelve times. To make matters more complicated, in August 2020 Tesla stock split 5 – 1. So now every time Elon hits a milestone, it has to buy 8.44 million shares for \$ 70 per share.

And please note – as we mentioned earlier in this article, Tesla’s current market cap is \$ 783 billion. Last I checked, \$ 783 billion is more than \$ 650 billion … the highest milestone number. Therefore, in other words, Elon has achieved all 12 milestones.

As of this writing, the Tesla board has only confirmed its half-milestone. This is \$ 25 billion which is “missing” from our calculations above. And yes this means that there is currently \$ 25 billion which according to our calculations, is not being counted in their total assets.

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When all this is said and done, at some point next year, assuming Tesla stays above \$ 650 billion, the board will confirm the second half of that \$ 50 billion. At that time, by our mathematics, Elon would own 270 million shares of Tesla. At today’s share price, the price of those shares alone would be:

## \$ 223 billion

If SpaceX’s valuation remained exactly the same, then \$ 46 billion would be Elon’s total assets at that point =

## 245 billion dollars

If you think this is a completely unforgivable number, please remember that Jeff Bezos had never divorced, today he would be valued at around \$ 256 billion.

Who knows what the future will bring for Tesla stock and SpaceX valuations, but let’s show that they both continue to explode (in a positive way … not in a rocket launch way).

(Photo by Maja Hitties / Getty Images)

## Will it take \$ 1 trillion to hit?

Just for fun, let’s say SpaceX’s next big increase is in the \$ 100 billion valuation. And assume that Elon’s share in this process decreases from 48% to 40%. At that stage, Elon’s SpaceX stake would be \$ 40 billion. And consider that over the next two years a SpaceX rocket strikes gold on an asteroid, rocketing its valuation up to \$ 250 billion in a private funding round, or as a future public company. At that point, SpaceX will contribute \$ 100 billion to Elon’s total assets.

Assuming that we soon live in a world where Elon officially owns 270 million shares of Tesla, what would it take for Elon to make the \$ 900 billion difference close to \$ 1 trillion? According to our math, Tesla will have to hit:

\$ 3,333 per share

\$ 826 per share

If this sounds completely insane, keep in mind that a year ago (after taking stock split into consideration), Tesla was trading at:

\$ 102 per share

Two years ago Tesla was:

\$ 60 per share

Tesla’s market cap would be \$ 2.35 trillion at \$ 3,333 per share. Apple’s current market cap is \$ 2.14 trillion. So a massive mass jump, but not out of the known universe of market caps.

A major caveat here is that all the net worth we mention are pre-tax. If Tesla and SpaceX continue to grow, Elon’s pre-tax paper net worth will increase but whenever he sells a share, he will have a capital gain and the IRS will cut. If he decided to sell every single share of Tesla and SpaceX that day it would have hit \$ 1 trillion … and if there was a market that could handle such a huge influx of shares for sale … Elon really Will end with a net worth close to \$ 500 billion.

It is said that, if SpaceX rises to a \$ 250 billion valuation in some crazy world and Tesla rises to a \$ 2.35 trillion valuation, Elon Musk will officially be the world’s first trillionaire at that time.

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