Before there was Elon Musk, there was William Crapo Durant. Billy Durant, as he was known, built one of the world’s biggest makers of horse-drawn carriages, bought control of Buick, co-founded General Motors, was forced out of General Motors, co-founded Chevrolet, regained control of General Motors, speculated on stocks, lost control of General Motors a second time, started Durant Motors, went bankrupt in the Depression, opened a bowling alley, suffered a stroke and died penniless in 1947.
It’s highly unlikely that Musk, one of the world’s richest people, will die penniless, but in other respects he and Durant have a lot in common. They are, or in the case of Durant were, both brilliant, restless builders of empires and defiers of convention who experienced the highest highs and the lowest lows of business.
I talked to some experts on the wild, early days of the automobile to see what Musk and the rest of us could learn from that period of ferment and creativity. One thing I found out is that the world is not always kind to visionaries with self-control issues. Durant flamed out at G.M. twice. In contrast, the prudent organization man who eventually succeeded him, Alfred Sloan, went from success to success. Renowned institutions bear his name.
“To Understand the Future of Tesla, Look to the Future of G.M.” was the headline on a 2018 article in Harvard Business Review by Steve Blank, a serial tech entrepreneur who has taught entrepreneurship at Stanford and other universities.
Referring to 1920, the second time Durant lost control of G.M., Blank wrote:
Founders often fail as managers, Blank noted. “As Tesla struggles in the transition from a visionary pioneer to reliable producer of cars in high volume,” he wrote in 2018, “one wonders” if the generous compensation plan that the Tesla board awarded to Musk that year “would be better spent finding Tesla’s Alfred P. Sloan.”
I called up Blank. He told me that the flaws in Musk that he identified that year remain today. “When you’ve been right in the beginning, you think you’re right forever,” he said. “You surround yourself with people who think you’re a genius forever. You run by whim rather than strategy.”
