In 2008 Elon Musk's marriage, SpaceX, and Tesla all came apart at the same time, in the middle of the worst financial crisis in generations. He came within weeks of losing both companies.
Everything breaking at once
His marriage to his first wife, Justine, fell apart, and the divorce began that year. At SpaceX, the small Falcon 1 rocket failed for the third time in a row in August, destroying its payload and draining a company that was already short of cash. At Tesla, the Roadster program needed more money just as the economy was collapsing, and investors had little appetite for an electric car startup.
The choice: split the money or save one
By late 2008 Elon Musk was down to the last of his PayPal fortune, and he faced a brutal decision. He could put all of it into one company, giving that one a real chance while letting the other die. He could also split it between SpaceX and Tesla, keeping both alive at the risk that neither would have enough to make it. He split the money, choosing to risk losing both rather than pick which company to kill.
The rescue at the end of the year
On September 28, 2008, the fourth Falcon 1 launch reached orbit, making SpaceX the first private company to put a liquid-fueled rocket into orbit around Earth. In December, NASA awarded SpaceX a contract worth about $1.6 billion to fly cargo to the International Space Station, which rescued the company. On Christmas Eve, Tesla closed an emergency funding round hours before it would have run out of money. Both companies ended 2008 alive, within weeks of each other.
The bottom line
SpaceX, which listed on the Nasdaq in June 2026 at a value of about $1.78 trillion, and Tesla both exist because of choices he made in his hardest year. The all-in bet of 2008 is the clearest example of his appetite for risk, and it paid off with hours to spare.
Timeline
- Early 2008: The global financial crisis deepens as Tesla works to fund its first car, the Roadster.
- 2008 August 3: The third Falcon 1 launch fails, destroying its payload and nearly emptying SpaceX.
- 2008 September 28: The fourth Falcon 1 reaches orbit, the first privately built liquid-fueled rocket to do so.
- 2008 December 23: NASA awards SpaceX a cargo contract worth about $1.6 billion, saving the company.
- 2008 December 24: Tesla closes an emergency funding round on Christmas Eve, hours from bankruptcy.
Sources (5)
- Spaceflight Now: Falcon 1 Flight 4 mission status (September 2008)
- NASA: Commercial Orbital Transportation Services, A New Era in Spaceflight (2014)
- Walter Isaacson, Elon Musk (2023), Simon and Schuster, chapters on the 2008 crisis
- Ashlee Vance, Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future (2015), Ecco
- Eric Jorgenson, The Book of Elon (2024)
