It’s hard to turn on the news lately without hearing the name Elon Musk mentioned. Within the past week, he made headlines when his concept for a high-speed transportation system called the hyperloop, was approved by the Department of Transportation for construction between New York and Washington DC. While in this same timeframe, he also shared footage of the world’s first working car elevator he designed to eliminate traffic jams and got into a Twitter war with Facebook founder Mark Zuckerburg about the dangers of artificial intelligence.
Any of these are worthy of an article being written, but this week I thought I would share my thoughts about something else he said recently that was, at least to me, even more interesting. In a string of tweets on June 9, Elon Musk discussed why he founded the electric car company, Tesla. What was most intriguing to me was his statement that making money was not his primary goal and that in fact he has given other car manufactures his patents in the hopes that their EV programs will grow as well.1
Musk can be called many things, visionary, environmentalist, dreamer, or even genius, but I think the description that fits him best is determined. I believe Musk is truly determined to change the world, even at the cost of his own businesses or their investors. His actions have shown that he is driven by far more than a profit margin. He is that rare breed of person that is both an idealist and a capitalist – a true believer in his mission to leave the world in a better place than he found it, and if he can make money while doing that, so be it.
As a country, we are seeing a resurgence, particularly amongst millennials, to do business with these kinds of socially-conscious companies. Businesses subscribing to this form of “conscientious capitalism” place a heavier focus on doing the right thing both for its employees and the consumer. These companies can have a wide range of belief systems. On one side of the spectrum, companies like Hobby Lobby and Chick Fil A incorporate the religious faith of their founders in all aspects of their business, while others, like Ben and Jerry’s and Whole Foods, focus more on their environmental impact.
This viewpoint is something I can certainly relate to. In fact, our Investment Management Firm, Stewardship Capital, holds many of the same principles. Our vision, in a nutshell, is to produce a stronger, healthier community through both the services we provide and the organizations we support. That’s why we commit ten percent of all management fees we collect to local non-profits and encourage volunteerism from all of our employees.
I don’t say this to toot our own horn, but instead to point out that too often business owners get a bad name. In the media, CEO’s are usually portrayed as greedy, selfish people taking from the little guy to fill their own coffer. But I would argue that business owners also have the greatest opportunity to have a positive impact on the world in which they live. The difficulty is finding the balance. If a business owner pays no attention to the bottom line, they soon go out of business and their ability to make a difference is reduced. If they focus too much on the bottom line, they soon lose sight of the people and causes that are truly important which harms both society, and their company.
In the end, I understand companies must be allowed to be profitable. Without the possibility of profits, innovation becomes nonexistent and we all suffer. But if we can evolve as a society to the point where we view profits as a natural by-product of doing the right thing and taking care of people rather than something obtained at the cost of everything else, we will all be better off.
(Past performance is no guarantee of future results. Advice is intended to be general in nature.)