How Elon Musk’s Fixer Handles the World’s Largest Fortune

“He vehemently opposes censorship. Especially for a sitting president. Insane,” Birchall wrote in a December message to Charles Johnson, a former right-wing political operative turned tech investor, who himself has been banned. from Twitter after being reported for harassment.

And then there are the intricacies of handling all things Musk. The billionaire’s life is complicated. He travels frequently by private jet and makes big, consequential decisions — like selling all his homes or buying a social media company — rather abruptly. This all happens as his already large family grows along with his profile. Someone has to be there to take care of the serious stuff – arranging the jet, selling the houses, contacting the bankers, hiring the nannies and the security guards. And for Musk, it’s Birchall. Birchall did not respond to messages or calls seeking comment on this story. wealth at Merrill Lynch in Los Angeles, where he was fired for “sending correspondence to a client without management approval,” according to a regulatory report.

The family office led by Birchall is not typical, with most investments being businesses that Musk started himself.Credit:Bloomberg

In 2010, Birchall joined Morgan Stanley, where someone familiar with his time there described him as not a superstar, but good at managing the fortunes of the wealthy.

Then Musk came calling.

Birchall left Morgan Stanley in 2016 to help the Tesla leader set up Excession, named after the science fiction novel by Iain Banks. The book centers on a powerful extraterrestrial object, Excession, which appears and inspires societies to fight for its control.

A big part of running a family office is about cultural fit. At Excession, it’s a surprising match between Birchall, a low-key Mormon family man, and Musk, a thrice-divorced online provocateur who gets openly high and recently had two kids with musician Claire Boucher, better known as Grimes name. The boy and the girl are called X and Y respectively.

Like everything around Musk, the family office is not typical. After all, most of Musk’s investments, with the exception of his recent purchase of Twitter, are in his own companies: Tesla, Space Exploration Technologies Corp., the Boring Co. and Neuralink. Other than that, he said he invested in a handful of cryptocurrencies and, before selling his mansions, a California real estate portfolio.

The vast majority of Musk’s wealth, which currently stands at nearly $250 billion, according to the Bloomberg Billionaires Index, is made up of his 16% stake in Tesla.

Birchall himself may have built up his own considerable wealth, albeit far from the stratospheric levels of his boss. A Morgan Stanley report shows that the typical head of a large family office earns around $1-3 million a year. But the compensation can be considerably higher depending on the responsibilities, especially if it includes direct money management by choosing stocks or hedge funds to invest in.

And at the highest levels, the rewards can be significant. John Phelan, the co-founder of Michael Dell’s investment firm, has done well enough to amass a world-class art collection that he can display in a newly built Palm Beach mansion.

Still, Excession is a much smaller outfit, which is unusual for someone of Musk’s vast wealth. The company is run by just two people, Musk said in 2019 during a trial after calling a British diving expert helping to save a Thai soccer team a “pedo guy”.

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“There are some very well-known family offices that employ over a hundred people and there’s everything there,” said Tayyab Mohamed, co-founder of family office recruitment firm Agreus Group.

There are usually researchers, a management team and an investment committee above a group of people who take care of day-to-day tasks such as hiring security or nannies and arranging travel , Mohammad said.

Bill Gates’ Cascade Investment employs dozens of people across various teams to manage venture capital, real estate and stock picking, including what Elon Musk claims is a $500 million bet against the shares of Bill Gates. You’re here.

Birchall has help. Alex Spiro, Musk’s attorney, played a key role in defending the billionaire in his run-ins with the U.S. Securities and Exchange Commission and the ‘pedo guy’ lawsuit. He declined to comment for this story. Another wealth management company, Catalyst Family Office, has also been linked to Musk. It describes itself as a multi-family office that offers investment, tax, philanthropy and estate planning services as well as “concierge and lifestyle management”.

“If you don’t have that personal chemistry and culture suited to the principal you’re going to work for, you won’t last long,”

Tayyab Mohamed, co-founder of family office recruitment firm Agreus Group.

Ronald Gong, managing partner of Catalyst, has been listed on tax forms for Musk’s foundation since 2013. He was listed as an agent for other entities associated with Musk, such as Gatsby LLC, which purchased a home in the area of San Francisco Bay. for $23.4 million in 2017. The property was the last of Musk’s California homes to be sold after he moved to Texas, as part of a $30 million deal in December. Silicon Valley-based Catalyst has also opened an office in Austin. The LLC was registered in Texas in August. Learn more about how Elon Musk is transforming parts of Texas.

Birchall also moved his family to Texas, buying a $2.25 million home in Austin in 2020. The listing for the five-bedroom home shows an ornate living space with columns in the hall and elaborate ironwork, with a swimming pool and a tennis court. outside.

Excession also moved to Texas, along with the Musk Foundation, Musk’s school Ad Astra, and several of his other LLCs, all of which list Birchall as director, director, chief financial officer, or some other title, including Musk’s mastermind Neuralink. – implant company, which lists Birchall as director and managing director.

But Birchall doesn’t necessarily have real executive power in those entities — for example, his name was only added to Neuralink documents for legal convenience, a person familiar with the matter said. Birchall rarely visited the Neuralink office and was not involved in day-to-day work, said the person, who asked not to be named when speaking about the internal workings of the company.

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Birchall has taken on more typical roles for a head of family office, such as facilitating relationships with big banks that Musk regularly turns to for mega loans. These were key to how Musk grew his fortune, borrowing to fund new ventures instead of being forced to sell Tesla stock. This also considerably reduces its tax obligations.

Text messages between Musk and his confidants, published as part of the investigation into his 2018 tweets about taking Tesla private for $420 a share, illustrate one example. Among the hundreds of messages and calls, there is only one exchange between him and Birchall – a text message where Birchall promotes his former employer, suggesting that Morgan Stanley should be involved in any privatization deal given that they have been “our best resource on a personal level”. side, from afar.

“They provide you with the largest ($350 million) of all lines and every time we pressed them for more borrowing power or a lower rate, they were successful,” he wrote. In 2018, Musk took out $61 million in mortgages on five California properties with help from Morgan Stanley.

“That seems fair,” Musk replied.

Unlike his boss, with his more than 90 million Twitter followers, Birchall’s online presence is minimal. He follows 40 people on Twitter, including Musk and all of his companies, and has never tweeted or liked a tweet. He is more active on Facebook, posting photos of his five children alongside videos and posts from The Church of Jesus Christ of Latter-day Saints.

Birchall was at Morgan Stanley when Elon Musk came to call him.

Birchall was at Morgan Stanley when Elon Musk came to call him. Credit:Bloomberg

The word that often comes up to describe Birchall is “nice” – four different people interviewed for this story used the word. But even those who have interacted with him aren’t left with much of an impression because he speaks little.

At times, Birchall’s work for Musk has seemed at odds with his nice-boy personality.

In 2018, Birchall was tasked with digging up dirt from a man in the ‘pedo guy’ trial, which criticized Musk’s suggestion that a SpaceX submarine be used to rescue the football team trapped in Thailand.

Birchall, under the alias of James Brickhouse, hired a con man who claimed to be a private detective. Birchall said in his testimony that he once used the Brickhouse alias to plan Musk’s trip and purchase a web domain – justballs.com. (The deal for the website never closed.) Musk ultimately won the deal.

These sorts of odd jobs aren’t uncommon for heads of family offices, said Mohamed of the Agreus Group, which is why it can be difficult to find suitable people for the job outside of the Wall Street world.

“The line between the personal and the professional intersects very often,” he said.

Over the past few years, Birchall has liaised with nonprofits on behalf of Musk’s foundation, such as the $100 million XPrize Carbon Removal pledge, giveaways to Feeding Texas, and millions of dollars to a pair of Covid-19 researchers.

Over the past couple of years, he’s occasionally handed over some responsibilities to Igor Kurganov, a poker player-turned-effective altruist who’s been the resource person for recent Musk Foundation recipients. Birchall is still responding to calls, said Dan Barouch, one of the Covid-19 researchers who received $2.5 million from the foundation. He described Birchall as “perfectly nice”, although he’s not sure exactly what he does for Musk.

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“The short answer is I don’t know exactly how the Musk Foundation works,” said Barouch, who also spoke directly with Musk, which is unusual for grantees.

Mohamed said Birchall and Musk must have great chemistry, considering Birchall had been there for over six years.

“If you don’t have that personal chemistry and culture suited to the manager you’re going to work for, you won’t last long,” Mohamed said. “I guess beyond Jared’s skill set – and I’m pretty sure he excels at what he does – but beyond that I’m absolutely convinced he shares incredible fit and chemistry with Elon Musk.”

Bloomberg

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