Elon Musk was always rich, not every parent has 28,000 to invest in their child’s company

Elon Musk was always rich, not every parent has 28,000 to invest in their child’s company.

Elon Musk and his brother Kimbal Musk co-founded the startup Zip2 in 1995. Their father invested $28,000 initially (something Elon now denies). Back then, $28,000 used to be a pretty big amount, given that most venture capital rounds were in the hundreds of thousands, rather than the millions of today. Zip2 was acquired by Compaq for about $307 million over 4 years. The amount Kimbal Musk actually received for the acquisition of Zip2 was much smaller, around $10 million, while Elon Musk received around $18 million.

Elon reinvested that money into founding X, which later merged with Peter Thiel’s startup PayPal. As for what Kimbal Musk did with his $10 million from the Zip2 sale, he used that money to help Elon start his companies Tesla and SolarCity, which explains why he still has a stake in Tesla and SpaceX and risked the rest of the money on his restaurant business. Most people don’t know this, but Kimbal is also a billionaire today.