By Barbara Kollmeyer
‘[Musk] thinks that, on almost everything, he knows better than everyone else.’
— Reid Hoffman
A billionaire venture capitalist who has known Elon Musk for decades says there’s one crucial thing that Americans should understand about how the adviser to President Donald Trump operates.
Musk doesn’t value the opinions of other people, LinkedIn co-founder Reid Hoffman, who worked with Musk in the early days of PayPal in 2000, said in a recent interview with “The Rest Is Money” podcast.
The approach of the Tesla chief executive to cutting government waste, Hoffman said, mirrors how he would operate one of his own companies. (Musk is also the CEO of SpaceX and owns the social-media platform X.)
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Hoffman added that, while some inefficiency exists within government, “it’s actually the nature of the beast, and you’re better off for it,” because it provides stability.
Musk, who oversees an entity known as the Department of Government Efficiency, or “DOGE,” has been criticized by some and praised by others for spearheading the slashing of federal spending and taking an ax, or chainsaw, to the government workforce in the initial weeks of the new administration.
“If a company goes boom and blows up and suddenly, you know, is just a smoking crater, it’s a tragedy … but it’s easily recoverable. If a government blows up, that’s a terror for all of society,” Hoffman said.
Hoffman and Musk have had a complex relationship in the past that some might describe as bitter rivalry. Hoffman is one of five prominent left-of-center figures whom Musk has accused of being behind recent protests against Tesla.
Hoffman said Musk and and his “DOGE” collaborators should have taken time to develop an understanding of how the government works instead of simply “deleting” programs and in the process accidentally firing people who worked in programs such as one focused on Ebola prevention.
Hoffman warned of a death toll that could reach into the millions due to cutbacks at the U.S. Agency for International Development, or USAID.
So why doesn’t Musk understand this, and what is it that people don’t understand about him? “To him, this is his hammer, and everything looks like a nail,” Hoffman said. “And, you know, he doesn’t particularly consult with people. He doesn’t particularly seek other expert advice. He thinks that, on almost everything, he knows better than everyone else.”
Hoffman was also asked about income inequality and whether the new industrial revolution that he has that he has predicted will stem from artificial intelligence — he has co-written a book titled “Superagency: What Could Possibly Go Right With Our AI Future” — will end up worsening inequality between the haves and the have-nots.
“What I try to orchestrate is that you have multiple powers that are held in balance with each other. … [I]f you have one company, it’s a model, it’s a serious problem. If you have 10 companies, they’re competing with each other, they’re held in balance, and that’s the kind of thing that I try to look to do,” he said.
Tesla shares fell 15.4% on Monday, their biggest one-day selloff since Sept. 8, 2020. The stock is down 45% to date in 2025. They were positioned in premarket trades to recoup much of Monday’s skid on Tuesday.
Hoffman and others founded the career-oriented social-media platform LinkedIn in 2002. It was sold in 2016 to Microsoft, on whose board Hoffman has since served. Hoffman is also a co-founder of Inflection AI and a partner with the venture-capital firm Greylock.
About the Author
Barbara Kollmeyer
Barbara Kollmeyer is based in Madrid, where she leads MarketWatch's pre-markets coverage of financial markets and writes the Need to Know column. She has worked in London and Los Angeles for MarketWatch previously. Follow her on Twitter @bkollmeyer.