In Good Company: How equity financing kept delivering for the world’s first trillionaire

13 October 2026

Elon Musk became the world's first trillionaire on June 12, the day SpaceX listed on Nasdaq.[1] His journey to that milestone is usually told as a story of rockets and electric cars, but it is also one of shrewd financing.

Across the two decades it took to get there, Musk sold remarkably little of what he built. He did not seek out a dividend-funded lifestyle, nor carry out a steady drip of scheduled share sales.

How did a man who rarely sold his shares keep two capital-hungry companies funded for 20 years?

The answer is leverage. A close look at Musk's financing history reveals a fortune built on pledging shares — he is well-known in financial circles as a serial borrower who treats his shareholdings as collateral rather than currency.

Whenever conventional credit assessments could not deliver sufficient funding for his ventures — likely because of the lack of any cash flow history, comparable businesses or precedent — share-backed loans became the bridge between what banks could underwrite and Musk’s vision of the future. 

The playbook has often attracted sceptics.

Bob Lutz, the former vice chairman of General Motors, dismissed Tesla as "not a car company" but "a cult of fanatics," insisting that "financially, it doesn't work."[2] Asked in 2020 whether a failing Tesla would be acquired, he even answered: "Who would want it?"[3]

Tesla went on to become the world's most valuable carmaker.[4]

The space sector was no kinder. Reusable orbital rockets were widely dismissed as commercially unworkable until Falcon 9 boosters made their recovery routine and rewrote the economics of launch.[5]

From PayPal to Mars

Musk, formerly a fintech entrepreneur, took the proceeds from the sale of PayPal in 2002 — roughly $180 million after tax — and poured it into two industries with long records of destroying capital: rockets, because he had concluded that making life multi-planetary required launch costs to fall by an order of magnitude, and electric vehicles, because transport was the most tractable front of the energy transition.[6]

By late 2008, both companies were weeks from failure, and Musk struggled to convince investors to back the start-ups with more capital.[7] Musk drained his own resources until a fraught fundraising round and a bumper contract from NASA saved the day.[8]

The lesson many entrepreneurs take from such difficult episodes is the importance of liquidity: access to cash is all too important for anyone hoping to keep their venture dreams alive.

In 2013, with Tesla, now listed on the Nasdaq, needing to raise capital to repay its federal loans, Musk was ready to be the company’s ultimate backer. He pledged to buy $100 million of new stock to signal insider conviction — funded by a $150 million share-backed loan from Goldman Sachs that lifted his balance with the bank to $275 million.[9] Electric vehicles were still a hard sell; without that borrowed vote of confidence, Tesla's path would have been much more difficult.

By early 2017, proxy filings showed his share-backed bank debt had snowballed to $624 million, with millions of shares frozen as collateral.[10]

As Tesla matured, he turned to another source of collateral: shares in another highly valued privately owned start-up – SpaceX.

From January 2018, Musk drew a series of loans directly from the rocket maker pledged against his private shares, peaking at a cumulative $500 million in December 2020 as the pandemic made such forms of liquidity indispensable.[11] Tesla's surging valuation ultimately helped him repay it all in late 2021.[12]

Then came the boldest use of the playbook: a $12.5 billion margin loan against Tesla stock to help finance the $44 billion acquisition of microblogging platform Twitter. Musk ultimately dropped the loan in favor of equity partners and corporate debt — but he did draw a $1 billion share-backed loan from SpaceX as the deal closed, repaying it shortly after.[13],[14]

The acquisition, much mocked at the time, gave him the data and platform that now underpin xAI, one of the leading names in the AI economy.

Over the past decade, Musk has been one of the most effective users of various forms of asset-backed finance. It’s a tactic that has allowed him to signal conviction with borrowed money, secure liquidity when ventures were vulnerable, and make strategic acquisitions that ultimately proved prescient.

Can Musk leverage SpaceX to glory?

SpaceX, newly public, is also pursuing debt-funded growth, albeit on a grander scale. Weeks after the largest IPO in history, the company moved to raise $25 billion in bonds to refinance a pre-listing bridge loan — despite holding more than $100 billion in cash.[15] SpaceX‘s debt load is projected to approach a quarter of a trillion dollars in the coming years.[16]

Mirroring Musk’s personal use of financing, SpaceX is leveraging the success of one venture to fund the growth of the next.

xAI, now part of SpaceX, has become the group's center of gravity. SpaceX is on track to earn more from leasing AI computing infrastructure to companies such as Anthropic and Google than from space launches. Musk told an all-hands meeting in August that AI revenue would exceed everything else the company does "probably in September."[17]

Including newly contracted cloud revenue, bolstered by recently acquired AI start-up Cursor, SpaceX is on track to reach $100 billion in annual recurring revenue by the end of this year.[18] The December target requires the company to more than triple the second quarter's $31 billion run-rate in six months, which would be a stunning achievement.

Of course, Musk still has his doubters. Consensus projections put SpaceX's 2029 revenue at about $207 billion, according to FactSet estimates, roughly a fifth of what Musk believes the company will achieve by 2030.[19] The burgeoning AI sector needs cloud computing infrastructure, but SpaceX faces formidable rivals in the dominant hyperscalers: Amazon, Google and Microsoft.

Meanwhile, leverage cuts in both directions: SpaceX's debt load could be its undoing if the AI sector fails to maintain revenue expansion.

The jury is still out on whether Musk and SpaceX will deliver what they have promised. But there is no doubt that equity-backed financing has helped him turn his entrepreneurial vision into reality.

Musk understands the importance of liquidity and retaining ownership better than most. His career is evidence that a share certificate is not just a record of what has been built: it can also be the financial rocket fuel for what comes next.

[1] https://www.bbc.com/news/articles/c4gypy3wwl7o

[2] https://www.cnbc.com/2016/10/26/ex-gm-vice-chair-blasts-tesla-saying-supporters-like-members-of-a-religious-cult.html

[3] https://insideevs.com/news/420876/bob-lutz-explains-tesla-doomed/

[4] https://www.bbc.com/news/business-53257933

[5] https://c2cjournal.ca/2026/07/beyond-the-blue-how-spacex-and-reusable-rockets-are-fuelling-a-new-space-economy/

[6] https://spacenews.com/40066why-elon-musk-says-2008-was-his-worst-year-ever/

[7] https://www.hbs.edu/faculty/Pages/item.aspx?num=51769

[8] https://www.bloomberg.com/graphics/2015-elon-musk-spacex/

[9] https://www.businessinsider.com/elon-musk-borrows-150-million-to-buy-tesla-2013-5

[10] https://www.bloomberg.com/news/articles/2017-03-16/musk-borrows-more-from-tesla-underwriters-as-company-adds-debt

[11] https://www.inc.com/leila-sheridan/elon-musk-500-million-spacex/91335742

[12] https://www.wsj.com/business/elon-musk-spacex-loan-269a2168

[13] https://www.reuters.com/business/media-telecom/elon-musk-borrowed-1-bln-spacex-same-month-twitter-buyout-wsj-2023-09-06/

[14] https://www.reuters.com/markets/deals/musk-looks-scrap-tesla-margin-loan-with-new-twitter-funding-bloomberg-law-2022-05-12/

[15] https://www.cnbc.com/2026/06/23/spacex-debt-bond-market-ipo.html

[16] https://finance.yahoo.com/markets/stocks/article/spacex-stock-hits-new-closing-low-in-rocky-week-ahead-of-earnings-134523324.html

[17] https://finance.yahoo.com/technology/ai/articles/elon-musk-spacex-ai-revenue-175407046.html

[18] https://www.thestreet.com/investing/stocks/spacex-analyst-plots-path-to-100-million-in-recurring-revenue

[19] https://edition.cnn.com/2026/08/04/business/spacex-earnings-q2-2026

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