Imagine you've been given a $180 million bonus at workWould you call it a career and
retire in paradise or would you dare to bet it all away on a new venture to try to change the
world? That is the choice Elon Musk faced and he chose to risk it all. It's hard to find a
company that generates as much excitement about the future than SpaceX does today. In May 2020,
it launched astronauts into orbit - the first time that happened from American soil in nine years.
Yet in the not so distant past, SpaceX nearly went bankrupt at the same time Tesla was struggling to
survive. I talked about that in my last video. Elon had to try to save two companies at the
same time. This is the story of how SpaceX nearly failed. When the company Elon co-founded x.com
merged with a rival to become PayPal which was then acquired by eBay in 2002, Elon walked away
with $180 million. He poured all of his winnings into new companies because he wanted to work on
the problems that he thought would most affect the future of humanity. He put $70 million into Tesla,
$10 million into SolarCity and $100 million into SpaceX. He had to borrow money for rent.
Elon went to Russia to figure out how much a rocket launch would cost. He planned on buying
a refurbished intercontinental ballistic missile, like one of these. He had a bizarre plan to send a
greenhouse to Mars so plants could grow on the Red Planet. The idea was to interest people in space
and hopefully increase NASA's budget. He wanted to purchase a rocket for $4 million but the lowest
price the Russians gave him was $8 million. The sale didn't go through. He realized on
the flight home that the cost of building a rocket was only 3% of the sales price so if he could make
the rockets himself it would drastically bring down the cost. And that is how SpaceX began,
by building its own rockets. Well, actually, SpaceX began with a carpet and a mariachi band
but ended up building a dream. In many ways, this dream was insane. Elon didn't have any
experience in the rocket business. He had never built anything like that before and had to read
books about it to learn more. He knew it was going to be tough and thought SpaceX would fail but he
once said in an interview that when something is important enough you do it even when the odds
are not in your favor. And he thought this was important enough. He believed reducing the cost
of spaceflight was essential to the survival of humanity in case there's a cataclysmic event that
wipes out life on Earth. His vision is for humans to live on other planets including Mars. If we are
able to increase the rate of innovation then life can become multi-planetary. This is the goal we
should strive for. He went about recruiting some of the brightest engineers in America for his
new company. We're looking for great people of all kinds to join the company so if you're interested,
please send us your resume. They worked non-stop and designed almost every part of the rocket.
The first rocket they built was the Falcon 1. Elon had an ambitious timeline of launching the
rocket in November 2003 - just 18 months after he founded SpaceX. That didn't happen. Falcon
1's first attempt to launch would not be until March 2006. It was a failure. It only spent 41
seconds in the air before crashing down violently because of a fuel leak. The following year,
in March 2007, the second launch attempt went better and everyone thought that they had made
it. Stages are separated. Stage separation happens when the lower portion of the rocket,
called the first stage or booster, separates from the rest of the rocket once the propellant
which is what feeds the engine is used up. But things didn't go as planned. The rocket started
to wiggle and the vibrations caused the fuel to slosh around. The slosh created an opening in the
engine. When the engines sucked in air, the rocket flamed out. In August 2008, the Falcon 1 made its
third attempt. Again, it went well at the start but then the first and second stages collided
after they separated. SpaceX had three failed rocket launches. Three strikes, it was almost out.
To make matters worse, the 2008 financial crisis made it difficult to get funding from investors
and at the same time, Elon had to scramble to save Tesla which was also about to die. Plus,
he was going through a divorce from his wife Justine. Elon set 2008 was the worst year of his
life and he was close to a nervous breakdown. He later said this reflecting on the difficult time:
"I don't ever give up. I'd have to be dead or completely incapacitated." The future of SpaceX
rested on the fourth launch. If the Falcon 1 failed to reach orbit again it would have
been game over for the company. We have lift off. On September 28, 2008, success, at last.
Stage separation confirmed. It finally reached orbit. But even
with a successful launch, the company was still in trouble. It didn't have any money
left. Elon had to figure out what to do. But then a phone call on December 23rd changed everything.
NASA had taken note of the successful launch and awarded SpaceX a $1.6 billion
contract to resupply the International Space Station. And the next day, on Christmas Eve,
Tesla secured a round of financing that saved the company. Elon came so close to losing both
companies at the end of 2008 yet at the very last minute, they both pulled through. But this was
still an uphill battle. Even his heroes like Neil Armstrong, the first person to walk on the moon,
appeared to be against him. Armstrong was worried that the Obama administration's reliance on
private companies could mean the U.S. and NASA would lose its dominance in space because they
would have no means of getting there themselves. After the success of the Falcon 1's fourth
attempt and the subsequent contract with NASA, SpaceX turned its attention to building a bigger
rocket, the Falcon 9. You can actually, literally fit a city bus in that fairing - it's that big.
The Falcon 9 would eventually carry a Dragon capsule to the International Space Station. The
capsule could be used for future flights with crew on board as NASA had retired its space
shuttle fleet in 2011 and had been relying on the Russians to send American astronauts into space.
There was just one problem with the Falcon 9: it was not reusable at the time. Elon knew building
reusable rockets was the only way to make space travel affordable. It would allow for about a
hundred-fold reduction in launch costs. You can imagine that if planes were not reusable,
very few people would fly. SpaceX worked on modifying the Falcon 9 to preserve the first
stage, the booster, the most expensive part. To give you an idea of how difficult it is
to land that part back on Earth, picture a pencil breaking apart and the lower portion
somehow lands right-side-up and intact. It's tough to do. SpaceX failed over and over and
over again but then on December 22, 2015, the Falcon 9 landed its booster for the first time.
SpaceX employees were more than a little excited. And then in 2018, SpaceX built a
more powerful rocket, the Falcon Heavy which is made up of three Falcon nines. Two out of those
three boosters managed to land although the third, the core booster, crashed into the ocean rather
than land on a drone ship but the mission was a success because the Falcon Heavy launched a Tesla
Roadster carrying a dummy astronaut into orbit. Two years later, SpaceX would send real astronauts
to space. Liftoff of the Falcon 9 and Crew Dragon. Go NASA, go SpaceX, Godspeed Bob and Doug.
In May 2020, NASA astronauts Bob Behnken and Doug Hurley traveled to the ISS on
board the Crew Dragon spacecraft carried by the Falcon 9. It was a historic moment - the first
time a private company had put humans into orbit. This is a dream come true, I think,
for me and everyone at SpaceX. This is not something that I ever thought would actually
happen And now SpaceX is looking ahead to even more ambitious plans. It's setting its sights
on developing a fully reusable rocket called Starship to carry people to the moon, Mars,
and back. According to the company, a round-trip ticket to Mars could cost between $100,000 to
$500,000. The idea is that it would be possible for people in developed countries to sell their
homes and move to the Red Planet if they want to. But all of these plans nearly never happened
because SpaceX nearly died. If it weren't for the success of that fourth launch attempt in 2008,
SpaceX would have run out of money and shut down. Death was all but guaranteed. But it managed to
stay alive by the skin of its teeth and Tesla did the same. If there's any lesson to take away,
it's to never, ever give up. I hope enjoyed what you saw. If you did, give us a like,
and don't forget to subscribe to my new channel and also hit the notification bell so you'll
know when I upload a new video. I hope to do a lot more stories on topics that I find super
interesting and if you have a story idea, feel free to comment below as well. See you soon.