In 72 hours or so, SpaceX will be tradable, at around $175 a share. By now, everyone, at least on LinkedIn should have heard of this and wondered if they should be mortgaging the house to get in on the action. But should we? The SpaceX IPO may be the cleanest example yet of the valuation question that every company with an unnormalized valuation grapples with.
The trillion $ question is whether this is this hype, or the best deal in history?
At a reported valuation around $1.75T-$1.8T, SpaceX is being priced like one of the most important companies on earth before public investors have seen it behave like a public company.
At a reported valuation around $1.75T-$1.8T, SpaceX is being priced like one of the most important companies on earth before public investors have seen it behave like a public company.
That sounds mad.
But the coin has two sides so we need to look at the other side of the argument.
The IPO materials point to a $28.5T addressable market. Yes $28.5 TRILLION. That number is doing a lot of work. For the SpaceX post, that means the claimed $28.5T TAM is about 23% of the entire global economy. That does not make it wrong. But it does mean the burden of proof is enormous. This is not just rockets. It folds in global connectivity, space infrastructure, AI compute, data services and a very large bet that orbit becomes a serious layer of the digital economy.
So the question is not whether SpaceX is expensive because it obviously is, Rather, the question is whether we are still underestimating the penetration curve. If SpaceX remains a rocket and broadband company, the valuation is hard to defend.
If it becomes the infrastructure layer for space, global internet, defence, AI compute and future orbital industry, then today's price may end up looking less like a mad professors hubbly bubbly and more like early access to a monopoly-grade platform. It means SpaceX because the platform everyone else builds Transport, Connectivity, Compute, Positioning/Sensing, Defence Infra, Industrial Base for inter space refuelling, logistics and manufacturing. SpaceX becomes the default operating layer for access to orbit, data from orbit, and services delivered through orbit.
That is what makes this IPO so interesting. The bull case is not "science-fiction monopoly", but that SpaceX has a compounding infrastructure advantage in a market most companies cannot even enter.
The bear case is just as simple: A huge TAM is not revenue. A mission is not a margin, and technical dominance does not automatically become shareholder return.
So my read: this is not normal IPO hype. It is something stranger. A genuinely exceptional company led by the greatest business brain thats ever lived in Elon Musk, asking investors to pay upfront for several futures that have not happened yet. Elon has offered retail investors up to 30% of the action. Normal IPO's cap is mere mortals around 10%, so Elon deserves at least a little thanks IMHO.
This could be absurd & could be historic. Probably both.
Don't mortgage the house, that would be silly. Or would it?