DEEP DIVE 07 · ORIGIN STORY
Early Life & PayPal
Before the rockets: a kid coder, two startups, a boardroom ouster, and $180 million.
Blastar to Zip2
At 12, Musk wrote and sold the game Blastar ($500). At 24, with brother Kimbal, he founded Zip2 (1995) — online city guides and maps for newspapers, an idea whose time had nearly come. The brothers’ account: their father provided about $28,000 to get started — a figure Errol Musk has contested (see Mythology vs. Record).
February 1999: Compaq bought Zip2 for $307 million; Musk’s reported take: $22 million. He was 27.
X.com and the merger
Musk plowed the money into X.com (March 1999), an online bank — the “X” brand that would return 24 years later. In March 2000, X.com merged with Peter Thiel’s Confinity, whose PayPal product was winning. The merged company took the PayPal name.
Then the classic startup drama: while Musk was on his honeymoon in late 2000, the board ousted him as CEO; Thiel took over. Musk stayed on the board and as a major shareholder.
The eBay sale
October 2002: eBay acquired PayPal for $1.5 billion in stock. Musk, the largest shareholder, received a reported ~$180 million — the war chest for everything after.
His own accounting (from interviews circa 2012–2014): $100M → SpaceX, $70M → Tesla, $10M → SolarCity, “and I had to borrow money for rent.” The allocation is consistent across retellings.
Why it matters
The PayPal fortune is the hinge of the whole record. Without it, there is no SpaceX (founded 2002, months before the sale closed — funded by the proceeds) and no Tesla investment (2004). The 2008 crisis nearly erased both anyway; the money bought the chance to fail, repeatedly, until the rockets landed.
Source notes
Acquisition figures from contemporary reporting and company disclosures; the $28,000 figure and its dispute noted on Mythology vs. Record; the allocation quote per Sayings. See sources.