Compaq buys Zip2, Elon Musk's first company, for $307 million
Elon Musk's first startup was sold in a deal worth more than $300 million, funding his next ventures.
Archive entry. This article looks back at an event from February 1999. It was drafted with AI assistance from public records and is being fact-checked. See our About page.
Zip2 was founded in 1995 by Elon Musk and his brother Kimbal. The company built online city guides and business directories, which it licensed to newspapers.
In February 1999, Compaq agreed to acquire Zip2 for about $307 million in cash plus stock options. Musk, who owned roughly 7% of the company, received about $22 million from the sale.
Why it mattered
The proceeds gave Musk the capital to start X.com, the online financial services company that later became part of PayPal. It was the first in a chain of ventures, and the first time he turned a startup into a large personal exit.
