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>float a fairly small issuance SpaceX are widely reported to be planning to raise $75Billion in new capital. It may seem small a % for the valuation target. Ho

by manquer 6mo ago

>float a fairly small issuance SpaceX are widely reported to be planning to raise $75Billion in new capital. It may seem small a % for the valuation target. However that is about 3 times previous highest raise of $29B when Saudi Aramco went public few years back. The market simply may not be that deep[1] There is a good chance this one becomes the Wework of this decade. The valuation, amount being raised, cooling interests in AI, and middle eastern capital changing priorities, interest rate outlook for the rest of the decade. These are all strong head winds to overcome even when not raising the largest ever amount in an IPO. That is not say that it is destined to fail, Elon is excellent salesman of vision when fundamentals are weak, There is no better proof than Tesla P/E . It is by no means clear this would be successful or not. The valuation, funds being raised, future growth potential are all not based on just SpaceX core businesses which would have been an easy sell. --- [1] i.e. it could be still under-subscribed even if everyone buys into the vision, growth projections, is comfortable with valuation gets fully onboard including retail. Even in this best case scenario SpaceX would have to sell at the lower end of the target range or go even lower and still end up being short matter what, because there could simply be not enough money in the market.

xenadu02 6mo ago
I think you have to temper the skepticism a bit though. SpaceX has dramatically lowered the cost of launching things into space. They are still the leader here. They can put a kg into orbit cheaper than anyone, even heavily subsidized state operations (EU and China). Their order book continues to be full. Every single launch vehicle they roll off the line was pre-sold years ago, including its re-use flights. I agree that Elon is their biggest potential problem and a big risk but their launch business is sound and wildly successful. If you believe access to space will be a growing segment of the economy in the future it isn't exactly a bad investment. I remember all the people putting Tesla down when they IPO'd. I bought $4k of stock (all I could afford at that time). Sold $100k of it a few years ago, still have the other half worth near $220k. Their numbers at IPO time were garbage and it wasn't clear they would even survive. Then they started shipping hundreds of thousands then a million cars. YMMV, consider all sides and make your own judgement. Just be careful about trusting the anti-SpaceX case. Even if everyone is technically correct about them it can still be a huge miss not to invest! The future is not static and if they can put the raised capital to productive use the IPO could end up being a fantastic deal. And FWIW I also agree the largest immediate risk is they are over-valued. Only time will tell on that front.
- joyeuse6701 6mo ago
  Not one more cent should be given to that man.
- nativeit 6mo ago
  I think you have to temper the glazing a bit though. These people and their endeavors are thoroughly, irredeemably corrupt. It’s nice you got a taste, but their impact on society has been calamitous, and will take decades to recover (if at all).
- afavour 6mo ago
  > Their order book continues to be full. In 2024 66% of their launches were for Starlink. So it’s not quite correct to suggest there’s a vibrant external market for their product, a lot of it is sort of self dealing.
  - MPSimmons 6mo ago
    > it’s not quite correct to suggest there’s a vibrant external market for their product There is a very large demand for launch services. SpaceX balances launching customers and launching Starlink. It's not like they give every launch slot to customers and then launches Starlink whenever there's an opening they couldn't fill.
  - nradov 6mo ago
    There's a vibrant external market for satellite Internet service.
  - BurningFrog 6mo ago
    Starlink is incredibly profitable though. It's not like they're subsidizing some experimental internal project. Starlink is the majority of their profits and growing fast.
  - Rover222 6mo ago
    This is missing the point of their valuation. SpaceX will internally use their launch capabilities to build industries that no one else can. Starlink is already their main revenue stream. Starship will open up new realms of possibilities.
tim333 6mo ago
>There is a good chance this one becomes the Wework of this decade. It's very different from WeWork which was basically just subletting office space with beer taps. At least SpaceX had done significant stuff with the rockets and Starlink.
- manquer 6mo ago
  The comparison was not about the strength of the business, it was about how the attempt to IPO and the original S-1 was the trigger for more realistic price discovery for Wework My comment was that it is possible that by trying/becoming public SpaceX also will go through that same process once their numbers become available.
bandrami 6mo ago
> excellent salesman of vision when fundamentals are weak Wow that was a polite way to say that

by manquer 6mo ago

xenadu02 6mo ago

I think you have to temper the skepticism a bit though. SpaceX has dramatically lowered the cost of launching things into space. They are still the leader here. They can put a kg into orbit cheaper than anyone, even heavily subsidized state operations (EU and China). Their order book continues to be full. Every single launch vehicle they roll off the line was pre-sold years ago, including its re-use flights. I agree that Elon is their biggest potential problem and a big risk but their launch business is sound and wildly successful. If you believe access to space will be a growing segment of the economy in the future it isn't exactly a bad investment. I remember all the people putting Tesla down when they IPO'd. I bought $4k of stock (all I could afford at that time). Sold $100k of it a few years ago, still have the other half worth near $220k. Their numbers at IPO time were garbage and it wasn't clear they would even survive. Then they started shipping hundreds of thousands then a million cars. YMMV, consider all sides and make your own judgement. Just be careful about trusting the anti-SpaceX case. Even if everyone is technically correct about them it can still be a huge miss not to invest! The future is not static and if they can put the raised capital to productive use the IPO could end up being a fantastic deal. And FWIW I also agree the largest immediate risk is they are over-valued. Only time will tell on that front.

joyeuse6701 6mo ago
Not one more cent should be given to that man.
nativeit 6mo ago
I think you have to temper the glazing a bit though. These people and their endeavors are thoroughly, irredeemably corrupt. It’s nice you got a taste, but their impact on society has been calamitous, and will take decades to recover (if at all).
afavour 6mo ago
> Their order book continues to be full. In 2024 66% of their launches were for Starlink. So it’s not quite correct to suggest there’s a vibrant external market for their product, a lot of it is sort of self dealing.
- MPSimmons 6mo ago
  > it’s not quite correct to suggest there’s a vibrant external market for their product There is a very large demand for launch services. SpaceX balances launching customers and launching Starlink. It's not like they give every launch slot to customers and then launches Starlink whenever there's an opening they couldn't fill.
- nradov 6mo ago
  There's a vibrant external market for satellite Internet service.
- BurningFrog 6mo ago
  Starlink is incredibly profitable though. It's not like they're subsidizing some experimental internal project. Starlink is the majority of their profits and growing fast.
- Rover222 6mo ago
  This is missing the point of their valuation. SpaceX will internally use their launch capabilities to build industries that no one else can. Starlink is already their main revenue stream. Starship will open up new realms of possibilities.

tim333 6mo ago

>There is a good chance this one becomes the Wework of this decade. It's very different from WeWork which was basically just subletting office space with beer taps. At least SpaceX had done significant stuff with the rockets and Starlink.

manquer 6mo ago
The comparison was not about the strength of the business, it was about how the attempt to IPO and the original S-1 was the trigger for more realistic price discovery for Wework My comment was that it is possible that by trying/becoming public SpaceX also will go through that same process once their numbers become available.

bandrami 6mo ago

> excellent salesman of vision when fundamentals are weak Wow that was a polite way to say that