- Elon Musk is one step closer to becoming the world's first trillionaire.
- Tesla's board proposed a new pay package that could grant him $1 trillion of stock.
- Musk's wealth largely stems from his stakes in Tesla, SpaceX, XAI, and other companies.
Elon Musk was already leading the race to be the world's first trillionaire when Tesla's board proposed he get a pay package potentially worth $1 trillion.
Under the plan, Musk would receive about 424 million shares or 12% of the company if he hits an array of ambitious goals. Achieving all of them — including supercharging Tesla's annual profits to $400 billion and increasing its market value roughly eight-fold to $8.5 trillion — would grant Musk shares worth more than $1 trillion.
With a $378 billion fortune as of Thursday's close, Musk is the world's wealthiest person, per the Bloomberg Billionaires Index. His biggest single source of wealth is his estimated 13% stake in Tesla. However, his stakes in the private companies he leads also contribute, particularly his 42% stake in SpaceX and 33% stake in XAI Holdings, the parent company of X and xAI.
He's more than $100 billion richer than the second person on the rich list, Oracle cofounder Larry Ellison, who has a $275 billion fortune.
Musk's net worth has exploded, rising from under $40 billion at the start of 2020 to $486 billion in December. According to Bloomberg, his net worth in May 2013 was just $5 billion, meaning it's grown roughly 75-fold in just over 12 years.
A key driver has been Tesla's stock soaring from below $30 on a split-adjusted basis at the start of 2020 to nearly $340 today. That increase has lifted the company's market value from around $76 billion to more than $1 trillion.
Similarly, SpaceX's valuation as a private company has jumped nearly 10-fold from about $36 billion after a funding round in March 2020 to $350 billion in a secondary share sale in December.
XAI could also become an important contributor to Musk's fortune. In July, the AI and social media company was widely reported to be in talks to raise up to a $200 billion valuation.
If Tesla were worth $8.5 trillion, Musk's existing stake alone would be worth more than $1 trillion. So if his compensation plan is also approved and he hits all of his goals, he could wind up owning more than $2 trillion of the stock.
