How to Create a Company | Elon Musk's 5 Rules

I think the first one is that depending on how well you want to do it and especially if you're starting a

company

, you have to work very hard. So what does superhard mean? Well, when my brother and I were starting our first

company

, instead of getting an apartment, we rented a small office and slept on the couch. And we showered at the YMCA and we only had one computer. So the website was up during the day and I was coding at night, seven days a week, all the time. He works hard, like every waking hour. That's what I would say, especially if you're starting a company.

And I mean, if you do simple math, you say, okay, if someone else works 50 hours and you work a hundred, you're going to accomplish twice as much over the course of a year as the other company. I think two: you have to make sure that whatever you're doing is a great product or service. It has to be really cool. I go back to what I said before: if you're a new company, I mean, unless it's a new industry or a new market, if it's an untapped market, then you have more ability to... The standard is lower for your company. product or service.

But if you enter something where there is a market against large, entrenched competitors, then your product or service must be much better than theirs. It can't be even a little bit better, because then you put yourself in the consumer's place and they tell you why would you buy it as a consumer? You will always buy the trusted brand unless there is a big difference. Therefore, many times entrepreneurs come up with something that is just a little better. And it can't just be a little better. It has to be much better. The other thing I would say is that if you're starting a company or joining a company, the most important thing is to attract great people.

So join a group that is awesome and that you really respect, or if you're starting a company, you need to gather great people. I mean, all a company is is a group of people who have come together to

create

a product or service. So depending on how talented and hard-working that group is, and the degree to which they are cohesively focused in a good direction, that will determine the success of the company. So, do your best to gather great people if you're starting a company. So I would say focus on signal over noise. Many companies get confused.

They spend money on things that don't actually improve the product. So, for example, at Tesla we have never spent money on advertising. We invest all the money in R&D, manufacturing and design, to try to make the car the best possible. And I think that's the way to go. So for any given business, keep thinking: Are these efforts that people are making resulting in a better product or service? And if not, stop those efforts. And then I think the last thing I would encourage them to do is... Now is the time to take risks. You don't have, yes, you don't have children, but as you get older your obligations increase.

And once you have a family, you start taking risks not only for yourself but also for your family. It becomes much harder to do things that may not work. So now is the time to do it before you have those obligations. So I encourage you to take risks now. Do something bold. You will not regret.