You don't have to believe. If you have a 401k you will be an investor 15 days after launch.
The IPO will go great, because the company will float a fairly small issuance. The big shareholders will not immediately sell. They will hold on and maybe even buy to support the price.
Then, after 15 days, it will enter the indexes and everyone's 401k will start auto-buying this stock.
You might say this is an obvious flaw in how the indexes work if they start immediately accept a brand new IPOed stock with limited float. You'd be right, which is why they won't list for a year.
I really wish more people were aware of this. It's a major scandal and definitely not being talked enough about.
Nevermind SpaceX, which at least have some importance for US defense industry, but xAI ? We will be investing in Elon's private venture, at the price that he himself set and which is at least 2 orders of magnitude too high...
Well, we elected a bunch of criminals, and Elon fired everyone who regulates this. The SEC was gutted like a fish, and contract terminations resulted in a large percentage of FINRA staff being laid off.
In order to be incredulous at xAI, you'd have to be incredulous of the AI business in general, which is fair.
But then you'd also be basically betting against the entire tech sector, and really the entire US economy and against the value add of AI. That kind of bet is much more difficult to swallow.
They absolutely succeeded because they had a better search engine. Without a doubt. I imagine there’s more than a few folks around here who used shit like askjeeves, altavista, et. al. Google was heads and shoulders better than those, and continued to get better over time.
No, I’m no Google fan, but it’s revisionist history to say they didn’t have the best search engine.
xAI's value is irrelevant here. This is about Elon throwing his weight around and rigging the game to create an artificial squeeze so him and his early investors can make bank by transferring wealth from everyone's retirement fund.
The company is irrelevant. The focus should be on the money making scheme
Overall it's worse than the other frontier models, but it's decent for queries about breaking news, due to being trained on twitter data.
It's also better for queries about controversial topics, and topics that the other labs have deemed to be "unsafe".
Politically, it differs quite a bit from other models.[0] It's right leaning, although it's closer neutral than other models, defining what neutral is a challenge though.
Right wingers and people creating nude images of girls and women on xitter without their consent? Those are the only things I even associate with Grok anymore. The venn diagram may line up pretty nicely between them, too.
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.
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[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.
>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.
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.
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.
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).
I am not an expert, but my understanding is most funds don't change allocations immediately, but it would be part of normal rebalancing, e.g. VOO and other indexes that track the S&P500 do it quarterly
They all smear the purchases and sales from index changes, but I don't think they publish on what timescale. Most funds try to minimize tracking error. There are funds that take this to a different level. When a stock is added to the big indexes, it tends to do poorly over the next year, and on the flip side when a stock is removed it tends to perform well. Dimensional funds have automatic rules to take advantage of this type of thing. There are other companies that have funds of this style, but overall they are much less widely used than the big index funds from vanguard, blackrock, state street, etc.
Based on the list of businesses at the top, the stock market seems like it rewards profit margin and profits, by businesses that sell meaningful products and services.
Can you provide an example of any of the businesses on that are on that list due to "mass stupidity"? They all seem to operate factories, employ many highly qualified people, and make a material difference in many or even most people's lives around the world.
Meanwhile, SNAP has returned -14.98% per year to its shareholders since it IPO'd (Jun 3 2017), and at an $8.27B market cap, it makes up a negligible portion of any broad market index fund, so not sure how SNAP's shareholders have been rewarded by mass stupidity, especially given that the founders still own half of the business. They would have been far better off liquidating their shares and investing in SP500.
Tesla is a great example. It’s 30% retail, 25% elon and insiders, and the remainder institutional, mostly index funds.
The investment thesis for Tesla is absurd. They built the market cap on hype and it got big enough that it remains a force. It’s a flailing company, kept afloat by bullshit.
The bigger issue is the death of small cap. Massive venture, sovereign wealth and PE funds don’t need the public market capital anymore, so they harvest the vslue and spit out the company late in the value cycle.
Snap, cool as it is, is a social media loser. The investors cashed out their shares to the public, who took the loss.
If you have $100k, you can do it with direct indexing at Schwab. The management fee is 0.40%.
I looked into it, but there are gotchas with wash sale rules and taxes. You really need $500k-$1M to avoid tracking errors. End of the day, the overhead seemed more problematic than the problem, so I ended up increasing my global allocation instead.
If you have a big enough portfolio, direct indexing (using something like Frec or Wealthfront) could be an interesting option, and weighting the companies that you don't want at 0.
Wealthfront offers the ability to blacklist stocks in your account (the feature is meant for people legally prohibited from investing in certain tickers).
It won’t exclude from regular indexes, but it will exclude from the direct indexing. I’ve been using it to exclude NVDA ever since it peaked (or at least reached the peak valuation I’m comfortable with)
Wealthfront’s portfolio minimum used to be $100k, but I think they have a new direct indexing product with a $5k minimum.
I can see both sides of it though. The old rule made more sense when companies ipo’d at small valuations. It could be argued it’s wrong to keep one the top five market cap companies off the sp500 for a year.
The flaw is the limited float. Indexes will be forced to buy a huge number of shares which don't exist, driving up the price.
For general investors if this is going to eventually happen, the earlier the indexes buy in the better. Otherwise more sophisticated investors will buy ahead of the indexes and grab the profit.
if they weighted (fully) by float (perhaps the average float from the trailing 90 days to the re-balance) it would not be as easy to game. The Nasdaq is accounting for float, but not completely.
They are, but SpaceX is trying to get rules changed. They want the index to buy at a multiple of the float, so they release say 5% but get bought as if they had released 15% float. They also normally wouldn't be eligible for index inclusion for ~1 year, after showing multiple quarters of good stewardship, etc. They're trying to bypass all that
I don't know about the funds, but it's really about the index. Both for the index funds that use the index, and the active mutual funds and index funds benchmark to that index.
ok so it seems pretty bad that they changed the index rules both to allow spacex in early and the wonky weighting stuff.
But if one already has index-based things that are likely to be captive on the wrong side of this, and one wanted to benefit or at least balance out, to confirm my limited understanding the goal would be:
- buy shortly after the IPO, ideally less than 15 days
- and sell less than 6 months later when lockups would end and insiders are set to cash out?
Thank you for posting that. I also read that on some less authoritative source I don't remember. It's truly scandalous. I wish ETFs will revolt and apply the old rule for inclusion, but I have no illusion it will happen.
Do the ETF managers have no discretion in determining when to buy? I was under the impression that they usually handle these changes to indices gradually even under normal circumstances.
The operators of the fund are allowed to do whatever they outlined in the prospectus to track the index, some funds allow futures, options, and swaps along with equity shares to maintain parity with the index.
There are ways to gain exposure to a single stock without directly purchasing shares, options and swaps being the most common. Owning the actual shares makes things easy for the fund operators, but there are other ways.
Is there something about why spacex wants to go public ? if not then this is definitely about xai... to hide unprofitability and offload it on general public ASAP.
My 401k has BrokerageLink set up and invests in VT/VTI. It takes less than 15 days so if your company offers BrokerageLink, you can avoid investing in SpaceX.
"If you have a 401k you will be an investor 15 days after launch."
This is not a given.
Many people have many different kinds of investments inside a 401k. Your 401k can own a rental property. Or gold. Or, in a more mundane scenario, the Russell 2000.
If it weren't for the glacial pace of plan administrators and plan holding companies there would be an opportunity for a fund provider to offer "S&P500exSpaceX". It's just another index, after all ...
SpaceX will not be part of the S&P 500 when it lists, so you can avoid owning SpaceX for now by sticking with non-NASDAQ funds. IIRC it would take about a year for SpaceX to qualify for the S&P 500, four consecutive profitable quarters is needed I believe.
If you own a NASDAQ fund or total US stock market fund, you will have exposure to SpaceX.
SpaceX has reduced the cost of getting a ton of mass into orbit by a factor of 10 and with their new system (Starship) it's poised further reduce that to 100x. They launch, land and re-use their rockets so often now that what was considered impossible 15 years ago is now routine. They currently put more things into space than the rest of the world combined and by a huge margin. They also have the most advanced internet infrastructure in the world and are poised to replace legacy ISPs and even mobile carriers in the coming decade. Oh, and they're doing all this while making a profit ($16B last year) despite their massive R&D spending and even with the money sink that is xAI their profits will be higher this year. It's hard to say that this isn't one of the most innovative and fast moving companies in the world. $1.75T maybe seems excessive, but less so than a lot of other companies out there.
Hey are absolutely not replacing “legacy” isps and certainly not mobile. Even if they had perfect coverage, sat signals are way too sensitive to obstructions.
It's not meant to replace terrestrial networks, it's a space-based alternative that serves areas carriers have no financial incentive to cover. Terrestrial cellular towers cost between $150k to $500k per tower, and are not economically feasible in less populated areas. There are also many dead-zones in mountainous regions, since cell signals are blocked by mountains.
Starlink Mobile supplements this, it's simply cheaper for mobile providers to partner with them than do their own buildout. Currently only 5% of the earth's surface is covered by cellular signals. Starlink will push that up to 85+%, and is backward compatible with existing cellphones.
Well if you make the argument that it will replace terrestrial networks and that's why its worth X trillion $ then yes, you do actually need to cover the 1% of earth surface where the waste majority of people actually spend most of their time.
The question is not if its a good business, the question if its a 2 trillion $ business, and if you only cover the 95% of earth without coverage. That more like a couple 100 billion $ business at best.
5G Non-Terrestrial Networks (NTN) is already part of the 5G standard. It's not a replacement for terrestrial carriers, it's an expansion that enables devices to be always connected and select the appropriate terrestrial vs satellite connection transparently. ~75% of the land mass on Earth has no cell coverage, ~90% if you include the oceans. It's the same transition in theory that we had from landlines to cell towers.
Great, but the overwhelming majority of money is made from the place people actually live. Those places are called cities. Only about a few % of earth are built on, and even among those the top 1% is where most people live.
Don't get me wrong, that fucking great business, but its not 'replacing terrestrial ISP' level great.
They said the same thing about cell phones vs landlines back in the day. Based on Starlink's revenue doubling year on year, and a six fold increase since 2022, I don't think anyone really knows what the upper bounds for global access is yet. And traditional telcos are usually limited to a region whereas Starlink is global. Just the top 20 global telcos alone are almost $2 trillion in market cap and $1.35 trillion in revenue. Starlink has captured less than 1% of that revenue to date.
It doesn't not seem like anything approaching a lucrative business.
TAM: How big is the market for high speed internet that can pay $1200+/year and isn't already well-served by comcast/at&t/etc? And of course, this is all with finite spectrum too. So you can't serve the major cities.
No doubt there exist buyers. But rural Montana doesn't have that many households. Add that 5 year replacement cycle and Musk's Trump alignment that has Europe building their own for security reasons.
These are US telecoms, the satellites blanket the entire Earth at all times. Lower ARPU, but still. Also, it seems like they're swallowing a large percentage of flight/cruise/military internet. And direct-to-cell data coverage of the entire Earth.
It has technical merit and it is impressive. But I doubt it's worth that much. I guess Musk has the talent of pushing and getting what he wants, so I guess we'll see how it plays out. I'm just afraid for the future is SpaceX in these crazy crazy times.
Sure, but factor of 10 cheaper in a market that is tiny still isn't that much. Even if you assume a 10x market size increase, its still tiny.
> They also have the most advanced internet infrastructure in the world and are poised to replace legacy ISPs and even mobile carriers in the coming decade.
That's quite the claim. I believe Starlink is a great business, the largest sat business for a long while to come (unlike space datacenter) but even if you are, very, very bullish on it, its not enough to justify the price.
You basically need to believe that:
- Launch market to 10x and grow faster then it ever has for decades
- Starlink goes from already being amazing systematically crushing terrestrial competition.
- xAi wins the AI race (this is almost absurdly optimistic)
- AI data-center becoming a insanely thing (also absurdly optimistic)
And even then this is hard to justify. And I certaintly don't believe 3. or 4. And 1 is a stretch. And while I believe in Starlink continued growth, terrestrial infrastructure still has lots of advantages for cities, where most people actually live.
> Money raised from a public offering would most likely help SpaceX finance its long-term goals of launching artificial intelligence data centers into orbit, creating a colony on the moon and getting humans to Mars. These are expensive and unproven endeavors that may take years and billions of dollars to achieve.
Oh my god. When a journalist writes like any of this is remotely plausible within “years” and “billions” of dollars it really downplays the near impossibility of these events happening.
I'm genuinely waiting to see at what the valuation lands at. The gap between what SpaceX charges per launch and what everyone else charges is so wide that the moat basically is the rocket. Hard to compare against anything even now.
That feels like a surprisingly weak moat though; costs have already fallen to the point where launch isn't the biggest cost of space hardware any more, the competition is hotting up, and whilst launch costs give Starlink an advantage over other LEO satcomms constellations, other countries have strategic incentives to underwrite the existence of that competition, and once those assets have been sent to space it's a straight fight for subscribers in a remote broadband connectivity market which is definitely real but also looks... actually not that huge, relative to a trillion dollar valuation, unless they're able to drop their prices to wired broadband levels without service degradation. Launch cadence is a bigger advantage for SpaceX than cost, but again something other entities plausibly will match, when the demand is there.
The real question is what comes first: viable commercial large scale infrastructure in space that might create new demand for SpaceX launches, or the competition?
SpaceX is pitching their own orbital data centres as a ready to go source of demand for lots and lots of Starship launches, but the unit economics of those vs boring old ground-based server racks and solar farms look dubious even before one considers just how convenient a justification it is rolling Elon's loss making businesses into the IPO.
The cadence point is understated. SpaceX launched 130+ times in 2025. The next closest was around 15. That's not a gap that closes in 2-3 years even with heavy subsidies, because it's not just the rocket, you need to account for the operational framework of doing it every 3 days.
the cadence is very important, but I don't think the operational framework is much of a moat (not having reusability and/or actual demand is a bigger obstacle to overcome). SpaceX went from 30 to >130 between 2021 and 2024, launching most of the satellites currently in orbit in the process.
You don't do that without pre-planning or being very very good at what you do, but most of the competition (including those that will fail) is targeting that. They don't need to scale as big or as fast as SpaceX to deliver enough comms satellites to orbit to kill any hopes of Starlink becoming a permanent low-latency connectivity monopolist. Plus of course most competitors in the connectivity space are able to spend a fraction of their overall hardware budget launching on SpaceX...
The valuation only makes sense if you price in Starlink becoming a top 3 telecom and Starship opening up entirely new markets. Possible, sure, but the launch business alone doesn't get you anywhere near 1.75T. They're betting the multiple on revenue lines that don't fully exist yet.
Which is a synonym for impossible. As far as the latest serious analyses have
shown, data centers in space are a pipe dream. Starlink’s total addressable
market was also shown to be way smaller than expected. The IPO in this case
just signals they’re desperate for liquidity and with no clear path to
profitability, if you discount unlikely, major breakthroughs happening very
soon. They’re changing the rules of stock indexes just to shove SpaceX in.
It goes to show how far the establishment is willing to go to save face. Elon’s
company going under would poke an unpatchable hole in the US entrepreneurial mythology. They can’t afford that right now and they rather crash the whole economy.
Could you link to those serious analyses? The ones I've seen don't portray it as a total impossibility? Scott Manley did a runthrough that seemed reasonably positive on the possibility.
The question for me is just timeline. The "rest of the galaxy" revenue is decades out, while Starlink revenue is now. Most of the 1.75T has to be priced on Starlink working at telecom scale. If not, 1.75T seems like a steal for the first true "Universal" investment...
How will they make money? From governments? With Elon's beliefs, few will be able to afford the vacation trips to space, except a few and they can already do this if they wanted, but haven't in droves.
If anything this just proves that the Overview Effect (traveling to space changes you) is just BS, Bezos and the others never changed.
I've watched Patrick's videos for enough years that I know he is not, but I still wonder from time to time. His voice is incredibly flat and uniform, he always uses fake backgrounds and there is extremely high use of jump cuts in his edits.
It is insane to think that this year multiple "startups" are going to IPO at valuations greater than that of the largest company in the world in ~2018. We have printed so much money in that period that these numbers have completely lost touch with reality.
The thing i'm not looking forward to is SpaceX will now be beholden to Wall Street. With Startship testing being so public, there's a whole cottage industry of youtubers watching their every move, there's going to be lots of ups and downs on the stock price.
I get the feeling investors are going to watch Starship explode and explode while it's being developed without understanding the trial/error, hardware rich, approach SpaceX takes and not like it. That's going to hurt the stock price and therefore hurt the company. Before, when Starship exploded people just pointed and laughed at Musk but SpaceX kept going. For better or for worse it doesn't really bother him, don't forget he got literally laughed out of the room when he proposed a re-usable orbital booster. Now those people actually matter because they'll sell/short and kill the stock price and therefore materially hurt the company. I replied to a sibling about Tesla, remember the shorts nearly killed Tesla before it even had a chance. The technology was there and the concept proven but the shorters almost killed the whole thing. IMO Tesla went public way too early and it almost cost them everything. idk what SpaceX has to gain by going public, are they hurting for cash? Based on the pace of development in Boca Chica it doesn't appear so.
/not a finance or investment expert just my observations and feelings
> get the feeling investors are going to watch Starship explode and explode while it's being developed without understanding the trial/error, hardware rich, approach SpaceX takes
Investors have been doing this since SpaceX first raised outside funding. American capital markets are not that risk averse.
tbf those investments weren't traded on a liquid market, and I suspect Founders Fund are less worried about short term setbacks than your average mutual fund or mug punter.
But of course we also know that Musk-run public companies are immune to normal dynamics of worrying about next quarter's returns (or even worrying about the CEO publicly torching his brand equity) so the very last thing I'd imagine happening is SpaceX becoming risk averse and profitability focused
I expect that the amount of "good influence" institutional shareholders can exert on SpaceX leadership and operations is about zero, and the amount of "bad influence" is more than that. Thus, the only way this can affect SpaceX's leadership is negative.
A big part of how SpaceX did what they did is that they weren't beholden to institutional pressures. They could afford to take major risks. This may change when a pool of investors who don't care about space and just want the line to go up end up being stakeholders.
None and that's the problem, the shorts almost killed Tesla for no other reason than being short. I think watching Starship after Starship blow up while being tested when investors don't really understand what they're looking at is going to be bad for the stock price. In a public traded company so goes the stock price so goes the business.
I'm a SpaceX investor, and from reading the comments here, I think most people here are missing why SpaceX has an outrageously high valuation.
SpaceX's valuation only makes sense if you buy into their mission of creating a civilization on Mars, and that the Space Exploration Technologies Corporation is the vehicle that creates this future. If SpaceX achieves this, it would be the most valuable company ever created. It would be worth $10s of trillions.
I personally believe SpaceX has a 70% chance of achieving its Mars ambitions. So I find the current $1.75 trillion valuation very logical, if not a little underpriced.
If you believe there's a SpaceX won't achieve these ambitions, which I'd assume most people in this thread belong to, then you'd assign a <1% chance of this happening. Then you'd value the company based on it's financials, at a more realistic $200B. You'd explain the 8x valuation gap though a mixture of financial engineering and Elon grifting, both of which I agree are happening.
The current $1.75 trillion valuation comes from the ratio of people in camp A to camp B.
is there an article or document covering the value proposition and realistic timeline of Mars colonization available to read somewhere ? i certainly think it's good for humanity to do it but as a casual observer i imagine it will cost a lot of money over the next ~20 years as opposed to making any.
SpaceX does internal sales of stock twice a year, so there will not be pressure from existing stockholders to sell. But there will be buyers. SpaceX is/was a great brand (before it became SpaceTwitter).
It's going to have a big impact on short-term volatility, but it's going to take a big drop in prices in a month. But I think it's a company that needs to be invested in the long run.
I feel the global instability could easily be very disruptive to SpaceX. Just imagine if Russia gets vindictive and starts destroying these satellites or blowing up their satellites to create orbital debris that could knock satellites out of orbit. A really bad solar storm could be devastating.
Just saying there are some decent risks, and pricing it at 1.75T IPO seems risky enough. I would not take that gamble.
> imagine if Russia gets vindictive and starts destroying these satellites
Sounds like lots of demand for new launches from the military-industrial complex.
> imagine if Russia gets vindictive and starts destroying these satellites
Space is big. It’s almost always cheaper to individually target satellites than to try and blanket orbits. And with Starship vs ASAT, the cheap drones are the satellites. Russia would bankrupt itself trying to sink Starlink and Starshield.
(They would also set a precedent that would let the U.S. deny China a LEO constellation.)
> It’s almost always cheaper to individually target satellites than to try and blanket orbits.
The problem is that even one satellite could start the Kessler syndrome due to how many are currently in orbit, and the numbers are expected to keep increasing rapidly - everyone wants their "sovereign" Starlink now that it has been shown to be feasible and performant.
Now or never. If the stock market goes bust because of the war then most IPO windows will close or will result in a much lower subscription rate. You can expect a flurry of these in the next few weeks.
> In the United States, SpaceX accounts for five of every six launches into space, according to Georgetown University’s Center for Security and Emerging Technology.
[All: please don't post unsubstantive comments to HN. You don't have to like $Company or $Person, but when the banned accounts are posting more thoughtfully than the rest, that's...a bad sign.]
On one hand I do take some enjoyment of suckers being fleeced. But on other hand I know who this all will benefit so I really can't do that.
As whole I find that valuation just insane, but seemingly if you only offer tiny enough slice with enough hype it might bump prices to something that really make no sense at all...
The suckers being fleeced are every pension fund in the world. They're demanding the S&P includes them faster to force ETF owners to buy in before the price tanks.
For most people their talent and expertise does not involve investing. That's why pensions and 401ks exist and why S&P/nasdaq have rules to protect the public.
You may wish it were not so, you may find it inelegant and infuriating and unfair, but it is a fact that retail investors nearly all underperform the market over a long enough time horizon. Maybe you are built different but for most of us it is very rational to take the market return for “free”.
Do understand, though, that market return will struggle to achieve 9% for the coming decades. A 9% annualised return would put the US stock market at 50% of world GDP in 10 years (edit: 20) and something like 90% of world GDP in 30 years (edit: 50 years). Cost of goods, and your customer's money, both have to come out of global GDP too.
(The current value of around 25% of global GDP doesn't even include the 1.75 trillion SpaceX which alone would be another almost 1%...)
ETF expense ratios are small but still mean retail will underperform anyway. It's an unfortunate situation all around.
Why are they being fleeced? If people didn't want to buy SpaceX they could buy some other ETF that doesn't include it. If there's enough of a demand I'm sure ETFs will be offered which include all the big indexed stocks except SpaceX.
Yes Americans will definitely move their 401k over this /s
Its fleecing because it basically takes everybody's money and gives it to support musk's money loser xai. SpaceX net profit 8 billion per year (previous years much less) and Xai was net losing 1.5 billion per quarter.
Unless you literally have nothing, YOU are one of the millions being fleeced. Pensions & retirement funds, any index fund that comes remotely close to technology, any equity you own in a venture in tech, any industry that via very short linkages is connected. Good luck avoiding this.
You only get "fleeced" if the stock crashes. If it's that terrible of a stock then the price will be low. As far as SpaceX goes, I think there are far riskier companies with little prospect of doing well.
They are only selling a small % of the shares in the IPO and subsequent weeks.
With a tiny float the price will almost certainly go up as a limited number of enthusiastic investors buy in. The plan is to then line up the lockup expirations so they sell into the index re-balance, a ton of new non-discretionary demand to match the new supply.
1.) All the image generation models will do that, xAI is just the one that caught flak for it
2.) SpaceX made $16B in profit last year, despite its enormous R&D costs and is on track for $20B this year, despite the losses from AI. People still wise to invest in Google despite their AI business still being a huge loss
> 1.) All the image generation models will do that, xAI is just the one that caught flak for it
Perhaps. But that's a huge undersell. "just the one that caught flak"? No. The one with nearly zero guardrails. Where users could trivially create underage porn, bestiality, etc., using prompts that you could put into any other AI and just say "does this image generation prompt seem likely to create legally problematic content?"
Not that I approve of that, but when image generation was hot and new, the insane amount of refusals I got from the major ones for apparently no reason, exacerabated by the general slowness, quotas and inherent trial and error workflow has completely soured me on them.
With $1.75t valuation & ~$16b in revenues, that's just over 100* revenues. SpaceX recently announced $8b in EBITDA, but I don't think it's a healthy metric for such a hardware-heavy business. Or, like Charlie Munger calls it, BS earnings.
Even if you give SpaceX the benefit of the doubt and assume they'll eventually settle at the profit rates Apple, Google, etc. have (~25%, check it), it'll be $4b in annual profits holding up $1.8t in market cap or roughly 450 PE ratio.
And that's if we give them the same great odds for profitability as America's most successful and profitable firms.
In summary, in the short-term the stock might very likely shoot up to $3t, but in the long-term, it doesn't look very healthy.
You don't have to believe. If you have a 401k you will be an investor 15 days after launch.
The IPO will go great, because the company will float a fairly small issuance. The big shareholders will not immediately sell. They will hold on and maybe even buy to support the price.
Then, after 15 days, it will enter the indexes and everyone's 401k will start auto-buying this stock.
You might say this is an obvious flaw in how the indexes work if they start immediately accept a brand new IPOed stock with limited float. You'd be right, which is why they won't list for a year.
At least they wouldn't until Elon got them to change their rules: https://www.bloomberg.com/news/articles/2026-03-30/nasdaq-cl...
I really wish more people were aware of this. It's a major scandal and definitely not being talked enough about.
Nevermind SpaceX, which at least have some importance for US defense industry, but xAI ? We will be investing in Elon's private venture, at the price that he himself set and which is at least 2 orders of magnitude too high...
Well, we elected a bunch of criminals, and Elon fired everyone who regulates this. The SEC was gutted like a fish, and contract terminations resulted in a large percentage of FINRA staff being laid off.
But the Dow is over 50,000 right now!!!1
(actually, 46,565.74 right now)
$50,000.
Gotta be accurate. Just saying 50,000 implies her incoherent rant was even a little bit based in reality.
https://youtu.be/WK12_IkAj2s?t=94
> It's a major scandal and definitely not being talked enough about
It’s being extensively talked about and debated. It hasn’t entered the mainstream discourse because it’s too technical.
It doesn't need to enter the mainstream discourse.
It needs to enter the inbox of a grand jury docket.
What crime do you think was committed? Indices are privately maintained and transparently rebalanced.
Yeah, not illegal, just corrupt AF like all the garbage spewing out of the Dumpty admin.
Just call it what it is: SpaceTwitter
SpaceXitter
In order to be incredulous at xAI, you'd have to be incredulous of the AI business in general, which is fair.
But then you'd also be basically betting against the entire tech sector, and really the entire US economy and against the value add of AI. That kind of bet is much more difficult to swallow.
That's not true at all.
I am confident some companies will make bank with AI. I am also confident xAI is not one of those.
It's as if you said "if you don't think Lycos is a good business you don't think search engines can work in general".
I kinda disagree because while most search engines failed and Google succeeded, they did not succeed by simply being a better search engine.
This is only further demonstrated by their excellent leverage of Gemini. Google continues to succeed at being Google.
They absolutely succeeded because they had a better search engine. Without a doubt. I imagine there’s more than a few folks around here who used shit like askjeeves, altavista, et. al. Google was heads and shoulders better than those, and continued to get better over time.
No, I’m no Google fan, but it’s revisionist history to say they didn’t have the best search engine.
Agreed. They won by having the best product. And it wasn't even close.
Yep, I tried it when it had the original logo, was using Altavista until then, it was immediately obvious that they were going to win.
>I am also confident xAI is not one of those
Surely you're going to buy long Put options with that confidence, right?
You can’t trade options on an IPO.
xAI's value is irrelevant here. This is about Elon throwing his weight around and rigging the game to create an artificial squeeze so him and his early investors can make bank by transferring wealth from everyone's retirement fund.
The company is irrelevant. The focus should be on the money making scheme
> against the value add of AI
Hasn't the surprising lack of value add been discussed with increasing frequency?
Who is using Grok seriously?
Overall it's worse than the other frontier models, but it's decent for queries about breaking news, due to being trained on twitter data. It's also better for queries about controversial topics, and topics that the other labs have deemed to be "unsafe".
Politically, it differs quite a bit from other models.[0] It's right leaning, although it's closer neutral than other models, defining what neutral is a challenge though.
[0]: https://arxiv.org/abs/2603.23841
Right wingers and people creating nude images of girls and women on xitter without their consent? Those are the only things I even associate with Grok anymore. The venn diagram may line up pretty nicely between them, too.
In my bubble I only see right winger influencers using it.
>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.
>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.
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.
> 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.
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).
Not one more cent should be given to that man.
Only NASDAQ so far; S&P 500 is apparently "reviewing its rules" but hasn't changed them yet.
So you've got a full year to wait on that index fund, assuming they don't cave.
Also, would individual funds that track the S&P have left themselves some wiggle room to delay this if they wanted?
I am not an expert, but my understanding is most funds don't change allocations immediately, but it would be part of normal rebalancing, e.g. VOO and other indexes that track the S&P500 do it quarterly
And even with that, they give themselves some room for tracking error, I think.
They all smear the purchases and sales from index changes, but I don't think they publish on what timescale. Most funds try to minimize tracking error. There are funds that take this to a different level. When a stock is added to the big indexes, it tends to do poorly over the next year, and on the flip side when a stock is removed it tends to perform well. Dimensional funds have automatic rules to take advantage of this type of thing. There are other companies that have funds of this style, but overall they are much less widely used than the big index funds from vanguard, blackrock, state street, etc.
Cave? That’s the boring company, this is the space company.
Uter and complete corruption: https://news.ycombinator.com/item?id=47389233
Ever since SNAP the whole IPO show has been a transparent scam to game the index funds.
The market simply doesn’t have enough people actively investing because it rewards mass stupidity over generating meaningful returns.
Based on the list of businesses at the top, the stock market seems like it rewards profit margin and profits, by businesses that sell meaningful products and services.
https://companiesmarketcap.com
Can you provide an example of any of the businesses on that are on that list due to "mass stupidity"? They all seem to operate factories, employ many highly qualified people, and make a material difference in many or even most people's lives around the world.
Meanwhile, SNAP has returned -14.98% per year to its shareholders since it IPO'd (Jun 3 2017), and at an $8.27B market cap, it makes up a negligible portion of any broad market index fund, so not sure how SNAP's shareholders have been rewarded by mass stupidity, especially given that the founders still own half of the business. They would have been far better off liquidating their shares and investing in SP500.
https://dqydj.com/stock-return-calculator/?ticker=SNAP
Tesla is a great example. It’s 30% retail, 25% elon and insiders, and the remainder institutional, mostly index funds.
The investment thesis for Tesla is absurd. They built the market cap on hype and it got big enough that it remains a force. It’s a flailing company, kept afloat by bullshit.
The bigger issue is the death of small cap. Massive venture, sovereign wealth and PE funds don’t need the public market capital anymore, so they harvest the vslue and spit out the company late in the value cycle.
Snap, cool as it is, is a social media loser. The investors cashed out their shares to the public, who took the loss.
I mean, that list has Tesla, which is overvalued by any plausible valuation approach.
Serious question: Is there some ETF that is "Index of S&P500 minus anything that smells like Musk"?
If you have $100k, you can do it with direct indexing at Schwab. The management fee is 0.40%.
I looked into it, but there are gotchas with wash sale rules and taxes. You really need $500k-$1M to avoid tracking errors. End of the day, the overhead seemed more problematic than the problem, so I ended up increasing my global allocation instead.
The cheapest option might be to buy the index and sell short the appropriate amount of Musk companies.
There is XMAG, but beware the expense ratio is much higher than the mainstream indices.
Yes, kinda. Goldman Sachs launched that under the symbol SPXXAI last month. I'm not totally sure how to actually invest in it yet though.
https://www.axios.com/2026/02/20/ai-goldman-sachs-stocks-ind...
Direct indexing is pretty easy these days.
If you have a big enough portfolio, direct indexing (using something like Frec or Wealthfront) could be an interesting option, and weighting the companies that you don't want at 0.
Wealthfront offers the ability to blacklist stocks in your account (the feature is meant for people legally prohibited from investing in certain tickers).
It won’t exclude from regular indexes, but it will exclude from the direct indexing. I’ve been using it to exclude NVDA ever since it peaked (or at least reached the peak valuation I’m comfortable with)
Wealthfront’s portfolio minimum used to be $100k, but I think they have a new direct indexing product with a $5k minimum.
I can see both sides of it though. The old rule made more sense when companies ipo’d at small valuations. It could be argued it’s wrong to keep one the top five market cap companies off the sp500 for a year.
The flaw is the limited float. Indexes will be forced to buy a huge number of shares which don't exist, driving up the price.
For general investors if this is going to eventually happen, the earlier the indexes buy in the better. Otherwise more sophisticated investors will buy ahead of the indexes and grab the profit.
if they weighted (fully) by float (perhaps the average float from the trailing 90 days to the re-balance) it would not be as easy to game. The Nasdaq is accounting for float, but not completely.
Aren't basically all the huge serious index funds float weighted?
They are, but SpaceX is trying to get rules changed. They want the index to buy at a multiple of the float, so they release say 5% but get bought as if they had released 15% float. They also normally wouldn't be eligible for index inclusion for ~1 year, after showing multiple quarters of good stewardship, etc. They're trying to bypass all that
Matt Levine wrote (uh, yesterday?) that the Nasdaq 100 was adding it (not a full linear weighting....) right now to accommodate this scam.
Ok fair, I forgot that QQQ is as big as it is.
Edit: wait, but QQQ is float adjusted?
What are the biggest not-float-adjusted index funds?
I don't know about the funds, but it's really about the index. Both for the index funds that use the index, and the active mutual funds and index funds benchmark to that index.
Why is it really about the index though, if the index fund doesn't track that public index?
If the index fund is tracking some proxy that is float weighted, isn't that what matters? At least when it comes to people's money.
Index funds track an index, thus the name
Yeah, the OEX is a more serious index for more serious people.
ok so it seems pretty bad that they changed the index rules both to allow spacex in early and the wonky weighting stuff. But if one already has index-based things that are likely to be captive on the wrong side of this, and one wanted to benefit or at least balance out, to confirm my limited understanding the goal would be:
- buy shortly after the IPO, ideally less than 15 days
- and sell less than 6 months later when lockups would end and insiders are set to cash out?
Thank you for posting that. I also read that on some less authoritative source I don't remember. It's truly scandalous. I wish ETFs will revolt and apply the old rule for inclusion, but I have no illusion it will happen.
They’re notably going for a large issuance.
Do the ETF managers have no discretion in determining when to buy? I was under the impression that they usually handle these changes to indices gradually even under normal circumstances.
The operators of the fund are allowed to do whatever they outlined in the prospectus to track the index, some funds allow futures, options, and swaps along with equity shares to maintain parity with the index.
There are ways to gain exposure to a single stock without directly purchasing shares, options and swaps being the most common. Owning the actual shares makes things easy for the fund operators, but there are other ways.
of course they do. read any prospectus for a FUND and funds track INDEXES using rules. inclusion in some index doesn't hamstring anyone.
blind purchases are not going to happen. people assume passive indexing is brainless, but it isnt.
> If you have a 401k you will be an investor 15 days after launch
You will be an investor in spacex and xai which it bought.
Fun fact, Xai net loss 6 billion dollars per year and SpaceX net profit 8 billion on a good year (https://www.reuters.com/technology/musks-xai-posts-net-quart... https://www.globalbankingandfinance.com/spacex-registers-tak...)
If you remember xai, it's that company currently being sued for the undressing kids feature (https://www.theverge.com/ai-artificial-intelligence/895639/x... https://en.wikipedia.org/wiki/Grok_sexual_deepfake_scandal) in its flagship product. By the way the feature is still enabled apparently
Is there something about why spacex wants to go public ? if not then this is definitely about xai... to hide unprofitability and offload it on general public ASAP.
The SpaceX profit is EBITDA, not real. And presumably includes massive starlink depreciation and stock based comp.
My 401k has BrokerageLink set up and invests in VT/VTI. It takes less than 15 days so if your company offers BrokerageLink, you can avoid investing in SpaceX.
"If you have a 401k you will be an investor 15 days after launch."
This is not a given.
Many people have many different kinds of investments inside a 401k. Your 401k can own a rental property. Or gold. Or, in a more mundane scenario, the Russell 2000.
If it weren't for the glacial pace of plan administrators and plan holding companies there would be an opportunity for a fund provider to offer "S&P500exSpaceX". It's just another index, after all ...
The indexes buy based on market cap or float?
Most serious index do float, nasdaq has somewhat different rules (but it's a weird index...)
SpaceX will not be part of the S&P 500 when it lists, so you can avoid owning SpaceX for now by sticking with non-NASDAQ funds. IIRC it would take about a year for SpaceX to qualify for the S&P 500, four consecutive profitable quarters is needed I believe.
If you own a NASDAQ fund or total US stock market fund, you will have exposure to SpaceX.
So that’s what he’s been busy with. I was hoping it was Ketamine.
This is absolutely vile. The xAi merger made no sense and this is forcing working class people into purchasing risky assets from a known scammer.
It does when you look at it with a few less zeros… it’s like a broke person floating checks for payday loans.
SpaceX has reduced the cost of getting a ton of mass into orbit by a factor of 10 and with their new system (Starship) it's poised further reduce that to 100x. They launch, land and re-use their rockets so often now that what was considered impossible 15 years ago is now routine. They currently put more things into space than the rest of the world combined and by a huge margin. They also have the most advanced internet infrastructure in the world and are poised to replace legacy ISPs and even mobile carriers in the coming decade. Oh, and they're doing all this while making a profit ($16B last year) despite their massive R&D spending and even with the money sink that is xAI their profits will be higher this year. It's hard to say that this isn't one of the most innovative and fast moving companies in the world. $1.75T maybe seems excessive, but less so than a lot of other companies out there.
$16B is the top line gross revenue number.
You don't count R&D as an expense per GAAP, so...
They have claimed $8B in EBITDA, also leaving out the amortization of R&D costs.
Those aren't audited numbers, as far as I know.
> Those aren't audited numbers, as far as I know
SpaceX has been audited for over a decade.
Good to know.
Audited financials would be released with the S-1. But it's very unlikely that they are not audited given the amount of money they have raised.
No related to this conversation, but I just started reading some books on finance and I actually know what most of those terms mean now! Lol
Hey are absolutely not replacing “legacy” isps and certainly not mobile. Even if they had perfect coverage, sat signals are way too sensitive to obstructions.
If anything they'll go for the lucrative customers that _need_ a signal to go faster through vacuum than through glass.
Maybe some decent revenue offering sat to cell for the traditional carriers.
I don't see how replacing mobile carriers with space based infrastructure is physically possible.
It's not meant to replace terrestrial networks, it's a space-based alternative that serves areas carriers have no financial incentive to cover. Terrestrial cellular towers cost between $150k to $500k per tower, and are not economically feasible in less populated areas. There are also many dead-zones in mountainous regions, since cell signals are blocked by mountains.
Starlink Mobile supplements this, it's simply cheaper for mobile providers to partner with them than do their own buildout. Currently only 5% of the earth's surface is covered by cellular signals. Starlink will push that up to 85+%, and is backward compatible with existing cellphones.
Well if you make the argument that it will replace terrestrial networks and that's why its worth X trillion $ then yes, you do actually need to cover the 1% of earth surface where the waste majority of people actually spend most of their time.
The question is not if its a good business, the question if its a 2 trillion $ business, and if you only cover the 95% of earth without coverage. That more like a couple 100 billion $ business at best.
I never said it would replace terrestrial networks... you invented that claim yourself and are responding to a strawman.
Starlink mobile is for rural areas, and the other 90% of the planet that's not well served by traditional terrestrial networks.
And 40% of earth's population live in rural areas, so there is a large market for this kind of service.
5G Non-Terrestrial Networks (NTN) is already part of the 5G standard. It's not a replacement for terrestrial carriers, it's an expansion that enables devices to be always connected and select the appropriate terrestrial vs satellite connection transparently. ~75% of the land mass on Earth has no cell coverage, ~90% if you include the oceans. It's the same transition in theory that we had from landlines to cell towers.
Great, but the overwhelming majority of money is made from the place people actually live. Those places are called cities. Only about a few % of earth are built on, and even among those the top 1% is where most people live.
Don't get me wrong, that fucking great business, but its not 'replacing terrestrial ISP' level great.
They said the same thing about cell phones vs landlines back in the day. Based on Starlink's revenue doubling year on year, and a six fold increase since 2022, I don't think anyone really knows what the upper bounds for global access is yet. And traditional telcos are usually limited to a region whereas Starlink is global. Just the top 20 global telcos alone are almost $2 trillion in market cap and $1.35 trillion in revenue. Starlink has captured less than 1% of that revenue to date.
It doesn't not seem like anything approaching a lucrative business.
TAM: How big is the market for high speed internet that can pay $1200+/year and isn't already well-served by comcast/at&t/etc? And of course, this is all with finite spectrum too. So you can't serve the major cities.
No doubt there exist buyers. But rural Montana doesn't have that many households. Add that 5 year replacement cycle and Musk's Trump alignment that has Europe building their own for security reasons.
> well-served by comcast/at&t/etc
These are US telecoms, the satellites blanket the entire Earth at all times. Lower ARPU, but still. Also, it seems like they're swallowing a large percentage of flight/cruise/military internet. And direct-to-cell data coverage of the entire Earth.
It has technical merit and it is impressive. But I doubt it's worth that much. I guess Musk has the talent of pushing and getting what he wants, so I guess we'll see how it plays out. I'm just afraid for the future is SpaceX in these crazy crazy times.
Sure, but factor of 10 cheaper in a market that is tiny still isn't that much. Even if you assume a 10x market size increase, its still tiny.
> They also have the most advanced internet infrastructure in the world and are poised to replace legacy ISPs and even mobile carriers in the coming decade.
That's quite the claim. I believe Starlink is a great business, the largest sat business for a long while to come (unlike space datacenter) but even if you are, very, very bullish on it, its not enough to justify the price.
You basically need to believe that:
- Launch market to 10x and grow faster then it ever has for decades
- Starlink goes from already being amazing systematically crushing terrestrial competition.
- xAi wins the AI race (this is almost absurdly optimistic)
- AI data-center becoming a insanely thing (also absurdly optimistic)
And even then this is hard to justify. And I certaintly don't believe 3. or 4. And 1 is a stretch. And while I believe in Starlink continued growth, terrestrial infrastructure still has lots of advantages for cities, where most people actually live.
Patrick Boyle (fund manager, professor, youtuber) recently discussed this IPO on his channel. Informative and entertaining.
https://youtu.be/8rS3fTbC7TE?is=TGpEdM2Y7sknP-cW
And despite popular opinion, he is not an AI :)
> Money raised from a public offering would most likely help SpaceX finance its long-term goals of launching artificial intelligence data centers into orbit, creating a colony on the moon and getting humans to Mars. These are expensive and unproven endeavors that may take years and billions of dollars to achieve.
Oh my god. When a journalist writes like any of this is remotely plausible within “years” and “billions” of dollars it really downplays the near impossibility of these events happening.
I'm genuinely waiting to see at what the valuation lands at. The gap between what SpaceX charges per launch and what everyone else charges is so wide that the moat basically is the rocket. Hard to compare against anything even now.
That feels like a surprisingly weak moat though; costs have already fallen to the point where launch isn't the biggest cost of space hardware any more, the competition is hotting up, and whilst launch costs give Starlink an advantage over other LEO satcomms constellations, other countries have strategic incentives to underwrite the existence of that competition, and once those assets have been sent to space it's a straight fight for subscribers in a remote broadband connectivity market which is definitely real but also looks... actually not that huge, relative to a trillion dollar valuation, unless they're able to drop their prices to wired broadband levels without service degradation. Launch cadence is a bigger advantage for SpaceX than cost, but again something other entities plausibly will match, when the demand is there.
The real question is what comes first: viable commercial large scale infrastructure in space that might create new demand for SpaceX launches, or the competition?
SpaceX is pitching their own orbital data centres as a ready to go source of demand for lots and lots of Starship launches, but the unit economics of those vs boring old ground-based server racks and solar farms look dubious even before one considers just how convenient a justification it is rolling Elon's loss making businesses into the IPO.
The cadence point is understated. SpaceX launched 130+ times in 2025. The next closest was around 15. That's not a gap that closes in 2-3 years even with heavy subsidies, because it's not just the rocket, you need to account for the operational framework of doing it every 3 days.
the cadence is very important, but I don't think the operational framework is much of a moat (not having reusability and/or actual demand is a bigger obstacle to overcome). SpaceX went from 30 to >130 between 2021 and 2024, launching most of the satellites currently in orbit in the process.
You don't do that without pre-planning or being very very good at what you do, but most of the competition (including those that will fail) is targeting that. They don't need to scale as big or as fast as SpaceX to deliver enough comms satellites to orbit to kill any hopes of Starlink becoming a permanent low-latency connectivity monopolist. Plus of course most competitors in the connectivity space are able to spend a fraction of their overall hardware budget launching on SpaceX...
Valuations are always more of an art than a science but in what world is SpaceX worth more than Meta today? Maybe the $1.75T is to find that world.
In the same world where Tesla is worth more than every other automaker in the world combined.
The valuation only makes sense if you price in Starlink becoming a top 3 telecom and Starship opening up entirely new markets. Possible, sure, but the launch business alone doesn't get you anywhere near 1.75T. They're betting the multiple on revenue lines that don't fully exist yet.
Yep the only way it makes sense is a combo of Starlink + AI data centers in space in 10 years.
Which is a synonym for impossible. As far as the latest serious analyses have shown, data centers in space are a pipe dream. Starlink’s total addressable market was also shown to be way smaller than expected. The IPO in this case just signals they’re desperate for liquidity and with no clear path to profitability, if you discount unlikely, major breakthroughs happening very soon. They’re changing the rules of stock indexes just to shove SpaceX in. It goes to show how far the establishment is willing to go to save face. Elon’s company going under would poke an unpatchable hole in the US entrepreneurial mythology. They can’t afford that right now and they rather crash the whole economy.
Could you link to those serious analyses? The ones I've seen don't portray it as a total impossibility? Scott Manley did a runthrough that seemed reasonably positive on the possibility.
I mean... in what world is it worth less?
Meta has increasingly ephemeral digital mindshare and no AI play. SpaceX has a near monopoly on access to the rest of the galaxy.
The question for me is just timeline. The "rest of the galaxy" revenue is decades out, while Starlink revenue is now. Most of the 1.75T has to be priced on Starlink working at telecom scale. If not, 1.75T seems like a steal for the first true "Universal" investment...
I wonder how many here are aware that SpaceX (not Musk) now owns X Corp. (nee Twitter), via its ownership of xAI.
Smells like great fiduciary responsibility!
You should see Tesla's rooftop solar business!
How will they make money? From governments? With Elon's beliefs, few will be able to afford the vacation trips to space, except a few and they can already do this if they wanted, but haven't in droves.
If anything this just proves that the Overview Effect (traveling to space changes you) is just BS, Bezos and the others never changed.
Is it a scandal? https://youtu.be/8rS3fTbC7TE
The speaker seems to be generated by AI. Edit: I not pro musk, but the run of the mill pictures aren't needed.
> The speaker seems to be generated by AI
This is Patrick Boyle, he's not AI generated? Why did you feel like the speaker is AI generated?
And Boyle, IMO, is a great presenter, in part because he is so deadpan
I've watched Patrick's videos for enough years that I know he is not, but I still wonder from time to time. His voice is incredibly flat and uniform, he always uses fake backgrounds and there is extremely high use of jump cuts in his edits.
The jump cuts have been there since almost the beginning.
The community noticed he rarely blinks and he ran with the gag and edited all of them out.
I suspect that he at least uses AI for scripts. He tends to repeat the same thing worded slightly differently a few times.
It is insane to think that this year multiple "startups" are going to IPO at valuations greater than that of the largest company in the world in ~2018. We have printed so much money in that period that these numbers have completely lost touch with reality.
The thing i'm not looking forward to is SpaceX will now be beholden to Wall Street. With Startship testing being so public, there's a whole cottage industry of youtubers watching their every move, there's going to be lots of ups and downs on the stock price.
> SpaceX will now be beholden to Wall Street
I get and appreciate that sentiment. Musk currently has a controlling interest in SpaceX. Do you expect that to change after the IPO? Thanks!
I get the feeling investors are going to watch Starship explode and explode while it's being developed without understanding the trial/error, hardware rich, approach SpaceX takes and not like it. That's going to hurt the stock price and therefore hurt the company. Before, when Starship exploded people just pointed and laughed at Musk but SpaceX kept going. For better or for worse it doesn't really bother him, don't forget he got literally laughed out of the room when he proposed a re-usable orbital booster. Now those people actually matter because they'll sell/short and kill the stock price and therefore materially hurt the company. I replied to a sibling about Tesla, remember the shorts nearly killed Tesla before it even had a chance. The technology was there and the concept proven but the shorters almost killed the whole thing. IMO Tesla went public way too early and it almost cost them everything. idk what SpaceX has to gain by going public, are they hurting for cash? Based on the pace of development in Boca Chica it doesn't appear so.
/not a finance or investment expert just my observations and feelings
> get the feeling investors are going to watch Starship explode and explode while it's being developed without understanding the trial/error, hardware rich, approach SpaceX takes
Investors have been doing this since SpaceX first raised outside funding. American capital markets are not that risk averse.
tbf those investments weren't traded on a liquid market, and I suspect Founders Fund are less worried about short term setbacks than your average mutual fund or mug punter.
But of course we also know that Musk-run public companies are immune to normal dynamics of worrying about next quarter's returns (or even worrying about the CEO publicly torching his brand equity) so the very last thing I'd imagine happening is SpaceX becoming risk averse and profitability focused
> Founders Fund are less worried about short term setbacks than your average mutual fund
Fidelity has been an investor since 2014. The only new money flows will be index and retail; everyone else has had access for years.
> idk what SpaceX has to gain by going public
They will save Elons shitty AI investment by making the public bag holders.
I expect that the amount of "good influence" institutional shareholders can exert on SpaceX leadership and operations is about zero, and the amount of "bad influence" is more than that. Thus, the only way this can affect SpaceX's leadership is negative.
A big part of how SpaceX did what they did is that they weren't beholden to institutional pressures. They could afford to take major risks. This may change when a pool of investors who don't care about space and just want the line to go up end up being stakeholders.
What makes you think this will be different from Tesla?
None and that's the problem, the shorts almost killed Tesla for no other reason than being short. I think watching Starship after Starship blow up while being tested when investors don't really understand what they're looking at is going to be bad for the stock price. In a public traded company so goes the stock price so goes the business.
I'm a SpaceX investor, and from reading the comments here, I think most people here are missing why SpaceX has an outrageously high valuation.
SpaceX's valuation only makes sense if you buy into their mission of creating a civilization on Mars, and that the Space Exploration Technologies Corporation is the vehicle that creates this future. If SpaceX achieves this, it would be the most valuable company ever created. It would be worth $10s of trillions.
I personally believe SpaceX has a 70% chance of achieving its Mars ambitions. So I find the current $1.75 trillion valuation very logical, if not a little underpriced.
If you believe there's a SpaceX won't achieve these ambitions, which I'd assume most people in this thread belong to, then you'd assign a <1% chance of this happening. Then you'd value the company based on it's financials, at a more realistic $200B. You'd explain the 8x valuation gap though a mixture of financial engineering and Elon grifting, both of which I agree are happening.
The current $1.75 trillion valuation comes from the ratio of people in camp A to camp B.
I believe there's a 0% chance SpaceX will achieve any of this, at least in my lifetime.
I however also believe that enough people will be lining up to buy whatever fantasy Musk sells (look at the Tesla stock as a shining example).
So I think SpaceX is still going to be a great investment if you can manage to get it at or below IPO price.
is there an article or document covering the value proposition and realistic timeline of Mars colonization available to read somewhere ? i certainly think it's good for humanity to do it but as a casual observer i imagine it will cost a lot of money over the next ~20 years as opposed to making any.
Good to know. So if you're in the majority and figured out Musk is full of shit, don't invest.
SpaceX does internal sales of stock twice a year, so there will not be pressure from existing stockholders to sell. But there will be buyers. SpaceX is/was a great brand (before it became SpaceTwitter).
It's going to have a big impact on short-term volatility, but it's going to take a big drop in prices in a month. But I think it's a company that needs to be invested in the long run.
I feel the global instability could easily be very disruptive to SpaceX. Just imagine if Russia gets vindictive and starts destroying these satellites or blowing up their satellites to create orbital debris that could knock satellites out of orbit. A really bad solar storm could be devastating.
Just saying there are some decent risks, and pricing it at 1.75T IPO seems risky enough. I would not take that gamble.
> A really bad solar storm could be devastating.
Starlink already accounts for these (e.g. https://www.theregister.com/2025/11/18/starlinks_method_of_d... ), and in any case they are put in orbit so that they eventually fall back to earth in case control is lost.
> imagine if Russia gets vindictive and starts destroying these satellites
Sounds like lots of demand for new launches from the military-industrial complex.
> imagine if Russia gets vindictive and starts destroying these satellites
Space is big. It’s almost always cheaper to individually target satellites than to try and blanket orbits. And with Starship vs ASAT, the cheap drones are the satellites. Russia would bankrupt itself trying to sink Starlink and Starshield.
(They would also set a precedent that would let the U.S. deny China a LEO constellation.)
> It’s almost always cheaper to individually target satellites than to try and blanket orbits.
The problem is that even one satellite could start the Kessler syndrome due to how many are currently in orbit, and the numbers are expected to keep increasing rapidly - everyone wants their "sovereign" Starlink now that it has been shown to be feasible and performant.
> problem is that even one satellite could start the Kessler syndrome
No, it can’t. Not in LEO. Militaries have searched for these one-shot solutions; there is no known orbital system for which it works. (In LEO.)
The only fuck-you orbits are in GEO.
> very disruptive to SpaceX
And to most everything else
I love space and they are an amazing company that I have been following for almost 2 decades, but I wouldn't touch that IPO with a 10 foot pool.
But the auto inclusion in Fortune 500 is basically cheating.
Bloomberg link if you can't read the NYT: https://www.bloomberg.com/news/articles/2026-04-01/spacex-is...
Man, did I parse that badly. "Space(X files) to go public."
I'm a little disappointed now.
Now or never. If the stock market goes bust because of the war then most IPO windows will close or will result in a much lower subscription rate. You can expect a flurry of these in the next few weeks.
Rabble rabble... debt... rabble rabble... xAI burning revenue...
> In the United States, SpaceX accounts for five of every six launches into space, according to Georgetown University’s Center for Security and Emerging Technology.
That's why.
And likely soon to be the world's biggest ISP, (they probably already are by some metrics)
They are nowhere near the world's biggest ISP by any metrics, what are you talking about?
Well in terms of landmass covered it's not even a contest.
Biggest by capital depreciation, no?
Maybe go look up how large the space launch market is ... you might learn something.
[stub for offtopicness]
[All: please don't post unsubstantive comments to HN. You don't have to like $Company or $Person, but when the banned accounts are posting more thoughtfully than the rest, that's...a bad sign.]
On one hand I do take some enjoyment of suckers being fleeced. But on other hand I know who this all will benefit so I really can't do that.
As whole I find that valuation just insane, but seemingly if you only offer tiny enough slice with enough hype it might bump prices to something that really make no sense at all...
The suckers being fleeced are every pension fund in the world. They're demanding the S&P includes them faster to force ETF owners to buy in before the price tanks.
God forbid we participants in the stock market evaluate a business before investing in it, or do any sort of work to get the return we're promised.
I, for one, much prefer to earn a 9% return without expending any effort or thought at all.
For most people their talent and expertise does not involve investing. That's why pensions and 401ks exist and why S&P/nasdaq have rules to protect the public.
You may wish it were not so, you may find it inelegant and infuriating and unfair, but it is a fact that retail investors nearly all underperform the market over a long enough time horizon. Maybe you are built different but for most of us it is very rational to take the market return for “free”.
Do understand, though, that market return will struggle to achieve 9% for the coming decades. A 9% annualised return would put the US stock market at 50% of world GDP in 10 years (edit: 20) and something like 90% of world GDP in 30 years (edit: 50 years). Cost of goods, and your customer's money, both have to come out of global GDP too.
(The current value of around 25% of global GDP doesn't even include the 1.75 trillion SpaceX which alone would be another almost 1%...)
ETF expense ratios are small but still mean retail will underperform anyway. It's an unfortunate situation all around.
Why are they being fleeced? If people didn't want to buy SpaceX they could buy some other ETF that doesn't include it. If there's enough of a demand I'm sure ETFs will be offered which include all the big indexed stocks except SpaceX.
Restructuring every ETF to be S&P but prior rules and no SpaceX would be enormously difficult.
Yes Americans will definitely move their 401k over this /s
Its fleecing because it basically takes everybody's money and gives it to support musk's money loser xai. SpaceX net profit 8 billion per year (previous years much less) and Xai was net losing 1.5 billion per quarter.
Unless you literally have nothing, YOU are one of the millions being fleeced. Pensions & retirement funds, any index fund that comes remotely close to technology, any equity you own in a venture in tech, any industry that via very short linkages is connected. Good luck avoiding this.
You only get "fleeced" if the stock crashes. If it's that terrible of a stock then the price will be low. As far as SpaceX goes, I think there are far riskier companies with little prospect of doing well.
They are only selling a small % of the shares in the IPO and subsequent weeks.
With a tiny float the price will almost certainly go up as a limited number of enthusiastic investors buy in. The plan is to then line up the lockup expirations so they sell into the index re-balance, a ton of new non-discretionary demand to match the new supply.
It's manipulation.
How about xAI? Losing $6B a year and with that whole "Grok, generate me an image of this child with no clothes on" horrorshow?
Sorry, "xAI, a wholly owned subsidiary of SpaceX".
1.) All the image generation models will do that, xAI is just the one that caught flak for it
2.) SpaceX made $16B in profit last year, despite its enormous R&D costs and is on track for $20B this year, despite the losses from AI. People still wise to invest in Google despite their AI business still being a huge loss
> 1.) All the image generation models will do that, xAI is just the one that caught flak for it
Perhaps. But that's a huge undersell. "just the one that caught flak"? No. The one with nearly zero guardrails. Where users could trivially create underage porn, bestiality, etc., using prompts that you could put into any other AI and just say "does this image generation prompt seem likely to create legally problematic content?"
No, Captain Free Speech said fuck it, let's roll.
Not that I approve of that, but when image generation was hot and new, the insane amount of refusals I got from the major ones for apparently no reason, exacerabated by the general slowness, quotas and inherent trial and error workflow has completely soured me on them.
With $1.75t valuation & ~$16b in revenues, that's just over 100* revenues. SpaceX recently announced $8b in EBITDA, but I don't think it's a healthy metric for such a hardware-heavy business. Or, like Charlie Munger calls it, BS earnings.
Even if you give SpaceX the benefit of the doubt and assume they'll eventually settle at the profit rates Apple, Google, etc. have (~25%, check it), it'll be $4b in annual profits holding up $1.8t in market cap or roughly 450 PE ratio.
And that's if we give them the same great odds for profitability as America's most successful and profitable firms.
In summary, in the short-term the stock might very likely shoot up to $3t, but in the long-term, it doesn't look very healthy.