There’s a lot of hype around the Hyperloop. Elon Musk announced his ambitious plans to help the state of California build a tube transport system that would be less expensive to build and maintain than the high speed rail system currently proposed. It’s important to understand that this feels like a very innovative solution, and there are probably pieces of it that are different. However, this concept has been around and worked on by a guy named Daryl Oyster with ET3 (Evacuated Tube Transport Technologies) for years. In fact, it’s been over 15 years since he started working on this model, and he even has patents on his application.
Having said all this, today we will discuss the difference between innovation and execution. Daryl innovated this idea and was maybe inspired by another concept; however, he’s the guy people now know for this type of technology. Let’s say this is his innovation. He pantented it and basically designed the evacuated tube transport system that can travel hundreds and thousands of miles in an hour. He had this idea and has been talking about it for years without building any prototypes, raising substantial capital, or building a credible team. The ET3 concept is still basically just an idea. The innovation in itself is not valuable in this sense.
Now, consider what Elon Musk did by publishing his version of this technology. We can see he has given it away in an open licensing so anyone can go and build on the product. With his resources, Elon Musk has likely offered enough of a different concept than the innovation ET3 proposed 15 years ago, and he will not trip over any patents, either. Now the big question is, which system will likely get built? Daryl Oster and ET3 were the innovators and have been working on these concepts for 15 years without anything substantial to show. Elon Musk has had two big ideas: one to revolutionize the electric car industry, and two, to do the same with the space industry. He has now built two successful companies in Space X and Tesla. Neither idea was original nor truly innovative, but his success has come through executing the innovation.
The execution piece is something that we need to watch because Elon Musk knows how to execute business models. The value in entrepreneurship doesn’t solely lie in innovation. Yes we need innovative ideas. Ultimately, though, the winners in the entrepreneurial game will be the entrepreneurs who can execute their innovative ideas. Elon is all about execution, and ET3 needs to step up its game and execute the creation of a company soon. It is likely that, with Elon’s support, the Hyperloop system will end up being the commercial success instead of ET3 due to Musks’s focus on executing the business model.
Execution has three components. First, it requires a big vision that everyone will get behind. And this is what Elon Musk has done. He has created the vision for the Hyperloop. He understands this dynamic. And he has gotten people excited and inspired by his vision, even though the original idea belongs to someone else. This is clear from some of the feedback tracking the Hyperloop that we read on Twitter: “Oh, ok - now I understand what it is all about.”
The second thing is to know that you can assemble the resources- the capital, people, leadership, and stakeholders - to build this innovation. And that’s where ET3 has struggled. The results are very clear; they just haven’t built anything significant. I predict that the Hyperloop will have some type of pilot or prototype built sooner than later because their focus is execution, not innovation.
Thirdly, once you are able to assemble the resources, you must be able to build around that innovation. Execution is about building what is possible, while learning from the marketplace. Learn from your product, your actions about the market, how you need to put this into work, test and trials, and your failures and success. And that’s what has made Elon Musk a billionaire.
So when you compare ET3 to Hyperloop, the leaders are both very creative people. The winner in the entrepreneurial space will be the entrepreneur who can execute. The bottom-line is people will back, support financially and politically, the leader who can really execute, has a clear vision, is able to pull together the resources, and finally, has the ability to build a company around that innovation.
If you are an entrepreneur, it is very important that you understand the value of execution. We often hear about entrepreneurs and their ideas. And the way we look at it is: how long have you been working on this? How do you think you will be successful with it? Innovation in itself is worth nothing. If they say, I went out and tested it in the market, built a prototype or a MVP (Minimum Viable Product), launched it, tried and failed or succeeded- that’s fine. This entrepreneur will surely make a mark in life because he/she is focused on doing things instead of just talking about innovation.
This discussion is not new, but the opportunity is presented because of Elon Musk’s press announcement, giving us a lifetime to build this and so the future of this type of transport – the tube or the supersonic transportation system, has some credibility. The science there, and Elon Musk has put his name on it. But if you look at it in comparison- the Hyperloop as one model and the ET3 as the other, then you will understand the marked distinction in the way the leaders work to create businesses. If I were to place a bet, my bet is on Elon Musk and the Hyperloop.
Finally, I would recommend that all entrepreneurs find innovative ideas, and then spend time to make it more innovative. Then find ways how you can execute your idea and get it into the market quickly.