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Comment by loufe | Hacker News Reader

I'm curious how the personal mission/ambition Elon has of SpaceX marries with fiduciary duty and shareholder expectations. If he is being honest, the true goal is "reach mars". There may not be money at the end of that tunnel.

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Common misconception — fiduciary duty does not necessarily mean a duty to maximize profits. In Musk’s case, he has repeatedly stated that Mars is the goal, and that shareholders who aren’t interested in that goal should get off the ride.

I'd really love to see an alternative history where A Friedman Doctrine: The Social Responsibility of Business is to Increase Its Profits was not so influential.

For anyone that's interested I'd really recommend just going back and reading the original piece, the regime of profits uber allis that we've lived under for decades is much stronger than even what he was arguing for in that piece.

To boost profits you have to provide more value (in a competitive field). And "more value = social benefit" has been a decent approximation so far. It's not guaranteed to hold true in the future though.

A few enormous exceptions to the value = social benefit rule in recent times have been cigarettes, junk food, and the things that lead to superfund sites. We can't get so upset by cigarettes that we lump shelving manufacturers in with Phillip Morris, but we also can't get so excited about shelving that we lump Phillip Morris in with them.

I don't think that cigarettes can be easily labeled as not having a social benefit. Nicotine has cognitive enhancement effects and it seems to help people with some disorders manage them better.[0] The benefits are to the extent that nicotine has been considered as a treatment for ADHD.

Nicotine being generally available could have provided significant amounts of social benefits by allowing people to self-medicate. Current healthcare systems are absolutely not adequate for picking up the slack and that's if the healthcare system is even willing to treat those people (ADHD treatment in some European countries is tricky).

While it was certainly bad how much cigarettes were pushed and I do think this caused more harm than good, it still probably had benefits.

[0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6018192/

Cigarettes look like a justifiable product at the level of "we roll leaves in paper," or "we give you a drug with side effects no worse than some other psychoactive drugs," but when you get in to the details of how it was actually done (carcinogens added above and beyond the smoke itself for the purpose of enhancing addiction, marketing designed around the well-known "trigger" stimulus response of relapsing drug users, denial of the effects to offload health liabilities to state insurance) it's no longer anything but an errant time in our history which will hopefully not be repeated. It is the prototypical example of the profit motive departing from the public good.

Sure, but if cigarettes weren't a thing then nicotine would probably be on the enormously long list of banned substances that you go to prison for possessing. The business is probably what kept it available for regular people. I think as smoking winds down there will be more talk of making nicotine illegal, because that's how our governments operate.

"We have to give millions of people lung cancer... to stop our irrational government from banning a relaxing drug" sounds like the plot of a villain from a 1980s Saturday morning cartoon.

It's not so much that this had to happen, but it's something that may have some social benefit. It's an unfortunate side of a society that accepts banning a wide range of things.

I'd argue the biggest glaring exception is advertising. I'd also add all kinds of rent-seeking behavior, a prime example of which are business models relying on abusing intellectual property regulations. And then you have a whole laundry list of business models and tricks that are socially negative but yield nice profits - various incarnations of "razor and blades" model, or the distressingly common in appliances sector - and now in computing hardware too - practice of replacing parts of a product with lower-quality substitutes in subsequent batches, without changing the SKU.

My own opinion is that profits and social value have become mostly misaligned a few decades ago already.

Arguably you could go back to the unsanitary meat packing plants of America's industrial revolution to find the first widely known US example of business doing things that they shouldn't to make more money. Someone with more knowledge of world history could go back farther.

Sometimes yes absolutely, but there are social goods that it's not efficient to capture or represent in the form of profits. The most extreme examples are national militaries and policing, but there's also fire services and arguably health care.

I know that last one is controversial in the US, but I'm a Brit and a conservative voting one at that, and over here and in Europe generally it really isn't at any significant level.

Some enterprises, particularly general social services and infrastructure just work very well as charitable trusts, or non profits. This has been shown to be effective for hundreds of years. Then for-profit enterprises can work alongside them to mutual benefit, such as medical products companies working along with health services. It's just a matter of which model works best in practice in a function, ideology be hanged.

As we're on the subject of SpaceX the NASA model worked very well for a while, but ran into the ground with the Shuttle. Now we seem to be back with a productive synergistic relationship between public and private functions.

"more value = social benefit" -- only if you ignore externalities, it seems to me. If companies had to pay for their environmental impact alone, much of the S&P500 would be wildly unprofitable. Leaving aside social externalities which are harder to quantify...

To boost profits you need to extract more value, regardless of whether you provide more.

Except if you find a business plan where you increase profits by emitting CO2 which doesn't have a direct cost associated with it, or make people angrier so they look at more ads, or take bets where if you win you get money, and if you lose you get bailed out by the government.

There's been plenty of failures of profit seeking as a social good that may have been avoided if companies felt a duty to society beyond profit seeking.

SpaceX definitely intends to increase its profits. It's management just thinks on much longer timescales than almost any other major business on earth.

Everything I've read is that spacex is trying to make humanity multi-planetary. That's not obviously profitable.

To sustain humanity as multiplanetary, we'll need to bootstrap a whole new economy - possibly two (the new location and in-space). There's a huge potential to make money in the process.

Right now they sell cargo launches, crew launches to LEO, Starlink subscriptions, and receive development grants/funding from NASA and the US military.

In the very long-term SpaceX will likely get to Mars and will get to make a claim for a significant amount of real estate and natural resources. Along the way I'm sure they will come up with many more revenue streams.

And they all pretend to agree with that goal, knowing full well that the goal can and will change when holders start to believe that the vision (and, if necessary, the visioneer) has served its purpose and it's time to earn.

They won't have to wait for that Martian end necessarily. Unless SpaceX is wrong about Starlink's global business potential, it's going to become one of the world's most valuable telecommunications services and SpaceX has repeatedly hinted that they're open to spinning it off.

But there's potentially an enormous amount of money along the way - first via taking satellites up and contracting with the US to take astronauts, then potentially providing infrastructure for space mining and heavy industry. There's also orbital tourism.

One way or another, space is going to end up being a valuable industry if only by virtue of the fact that access to space will be a critical national security issue - imagine if China monopolized access to space and could take down satellites at will.

The motivations of modern day billionaires regarding space aren't any different than the motivations of 16th century explorers to the Americas.

Iron isn't worth much by the pound. But what if you could mine a solid chunk a few times the size of Everest?

Fun point with iron, but I’d probably start with the high purity platinum asteroids :-)

> There may not be money at the end of that tunnel.

I don't know, I find that very unlikely to be the case. If ever there was value in "being first", this is the mother load.

The closest analogy I can think of is the arrival of European powers in the New World. Sure, it's strange, inhospitable and downright dangerous, but even if you fuck everything up along the way and thousands of people die, you're still reaping outsized rewards.

Space is an order of magnitude more inhospitable than the Americas, but (a) so is our understanding of the technology and the universe and (b) humans don't actually need to be in Mars for humanity to effectively reach mars.

What rewards though? Even with rapidly reusable rockets, I can't think of any resources on Mars which would be worth the cost of transporting back to Earth.

Maybe if asteroid mining becomes a viable business, Mars' shallower gravity well and higher orbit around the sun might give it a significant enough competitive advantage for bulk goods like fuel and water that may be needed in the asteroid belt. Still, that's a lot of "ifs" and "mights", for what is, even in the best-case scenario, very long-term venture.

Even if it is, they have managed to build a profitable and sustainable business model on the way. SpaceX is the launch company everyone wants to use and the competition is at least a decade behind.

> If he is being honest, the true goal is "reach mars".

Its usually best to assume anything a corporate founder, executive, or PR rep says in public about the corporation, its mission, or their personal ambition regarding it is a calculated effort to promote the business interests of the corporation by shaping public perception, and only coincident with the truth to the extent that there is a likelihood that the truth happens to be convenient, or that falsehood or silence would be detectable and have adverse consequences.

Privatizing Mars won't be profitable? Ever see Total Recall?

Starlink is presumed to be the main moneymaker which could justify a much higher valuation than 100B if their plans pan out

Musk has also said SpaceX will likely spin out and IPO Starlink. I think he also said he intends to use his wealth from Tesla, and therefore likely Starlink too, to fund his Mars ambitions.

There’s also quite a lot of opportunity of Starship is successfully “fully and rapidly reusable”. Point to point transport of cargo and potentially even humans, etc.

Yes starship will open up a lot of opportunities, however the market is not large enough unless spaceX creates it themselves.

Falcon 9 already launches more than 50% of all Payload sent to orbit today.

They will have the launch airline or cargo service company too not just build starship and get regulatory approvals, promote, sell tickets/capacity and provide customer service etc.

All risky steps in a possible side use case for the starship program. Realistically none of this happening before mars missions start likely 2030s.

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