Illustration: Brendan Lynch/Axios
SpaceX is preparing to launch the largest IPO of all time — with expectations that it could raise more than all U.S. listings in 2024 and 2025.
Why it matters: Wall Street is understandably giddy. But what it's about to pitch investors is unprecedented, and could impact how (or if) OpenAI and Anthropic go public later this year.
Here are four ways this IPO is different from all others:
1. Size: SpaceX reportedly wants to raise around $75 billion at a $1.75 trillion valuation.
- For context, the entire U.S. IPO market only raised more money in two of the past 10 years.
- It also will seek to become the first company to ever go public at a valuation of $1 trillion or more, with hopes of immediately being worth more than Walmart, Exxon Mobil or Meta.
- Finally, Musk is said to be reserving up to 30% of the offering for individual investors — three times the norm.
2. Flux capacity: SpaceX has been around for decades, but the version going public is a newly formed conglomerate.
- Elon Musk recently merged xAI into SpaceX, after having previously merged X (fka Twitter) into xAI (whose 11 cofounders have all left).
- No one really knows if the combinations will work, and it's too early for there to be much evidence in either direction. Let alone if SpaceX's plan for one million orbital data centers — which seems to be Musk's grand vision — is viable.
- IPO investors always get access to a couple years of past financial performance but, in this case, it's relatively irrelevant.
3. X factor: Elon Musk himself. And not just the part about him seeking to simultaneously run two of the world's most valuable companies.
- Musk hasn't been part of an IPO since Tesla in 2010. At the time, he was fairly quiet on social media. In fact, his first-ever tweet was just a couple of weeks earlier.
- Today's Musk may struggle to comport with rules about what company insiders can and can't say once the IPO process begins. For example, Google's IPO was almost waylaid by comments its co-founders made in a Playboy interview.
- On the other hand, the current Securities & Exchange Commission is lax when it comes to enforcement, and Musk is (usually) friendly with the boss' boss. Plus, there are reports that the two sides are preparing to settle a dispute over Musk's alleged violation of securities law in 2022.
4. Red ink: We don't yet know SpaceX's overall financials, and its initial IPO filing is likely to be confidential.
- What we're fairly certain of, however, is that its xAI unit (sans X/Twitter) is hemorrhaging money. Just like other large foundation models that are scaling by spending on GPUs.
- Investors may not care, believing all things AI are up and to the right, but this would be the first major market test.
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