Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive from coast to coast with Caroline Hyde in New York and Ed Lovelow in San Francisco.
This is Bloomberg Tech.
I'm Ed Ludlow and I'm Caroline Hyde.
And today is the day SpaceX's big debut in the public markets. The company is set to begin trading any moment now.
And break down what that means for investors and for the space economy and for the IPO pipeline. Elon Musk, speaking at Star based Texas just a couple of hours ago.
I give SpaceX less than a ten percent chance of succeeding at all.
To be clear, In fact, I told people this.
Look, we're probably gonna fail, but you know, we should give it a try, because if we don't, if there's not an new company that erospace, we will never be a truly space varing civilization.
And we check in on these markets as the latest indicated price of SpaceX shares is one hundred and sixty two dollars each, the IPO price one hundred and thirty four dollars.
We look at the Nasdaq one hundred ed are we're up rockit rightti percent.
Yeah, and look, this is about geopolitics, this is about hopes on some sort of deal and are you with Iran in the United States? But thus far we are completely focused on the impact of this IPO.
Yeah.
Look, there is a lot of evidence that whatever asset class you look at, people are trying to be positioned to play this IPO in the moment when we start trading imminently, starting trading indicated right now to open at one hundred and sixty two dollars each.
We price the IPO one hundred and thirty five.
But loads of disappointed people on the institutional side and the retail side.
Yeah, who didn't get allocations.
But if you've got an allocation, you're looking at maybe a twenty percent pop if it opens at that level. Your hira a land is down at the Nasdaq for us.
What are you hearing? What are you seeing?
Well, the fanfare from the opening well is over, but we still have legions of Elon Musk fans outside and some movement behind me on the Nasdaq floor. But as you guys were saying, we've gotten a series of indications throughout the morning and they've continued.
To edge lower. As traders work through.
The price discovery process. The latest indication is one hundred and sixty two dollars a share, down from earlier levels that were around one seventy five. Even so, that is above the one hundred and thirty five IPO price and does imply a valuation of some two point one trillion dollars, meaning SpaceX would still rank among the most valuable companies in the world from its very first trade.
One sixty two a share twenty percent from the IPO price, exactly, implying a market value roughly two point one trillion dollars. Bloombok to your heart and end back throughout the hour at the Nasdaq. Let's talk about SpaceX. Christian Garrett one three seven venches, managing partner. SpaceX was one of the first investments that one three seven Benches made net net. In the end, the state worth billions and billions of dollars. And you've been with the company as its story changed,
started with reusability and rockets. It's a future of AI and the enterprise. I just ask you, Christian, to reflect on what this IPO represents to you in the firm.
Well, you know, first off, we're extremely excited for the IPO. It's a great milestone, but you know, as long term investors, this is just the beginning of the journey.
For the Company'd say that, of course, Look.
I think you know, the company, like you mentioned, has gone through this evolution, and many things have grown in the vision or scope, but many things have stayed the exact same. The company has always had the mission to make humanity multiplanetary, to expand consciousness across the universe, and they knew that they had to find incredible business models where they had advantages in order to fund that vision.
They started by really bringing launch back to America, which in and of itself is an incredible thing to be a part of. They were the first company to build a reusable rocket, a partially re usable rocket, which dramatically dropped costs for launch. That advantage gave them the infrastructure to build Starlink, which is the world's largest constellation, and from there you're seeing that they have the advantage to build infrastructure terrestially and hopefully in orbit for data centers. A. L.
Musk We started the show saying, just a ten percent chance that was survival. Was that what you thought when you first were getting under the skin of this company at one, three seven, Did you have bigger bets from that in terms of thinking it'd be more than ten percent probability? And where do you see your holdings going longer term?
I think, guys, investors, you always can have some revisionist history sometimes and so I'm sure we were always extremely confident in the company. But look, I mean, I think there's just been multiple points of inflection for the business, and so I think there's high confidence that NASA really we needed launch capacity to come back to the state. So it was an understandable bet back in the day when my two partners were at Founders Fund in one
of the early investment in the company. When we continue to invest when what the Seven Ventures was formed two ten, twenty eleven onward and inve in the company every single year for sixteen years, I think the bet still remain the same, which was fundamentally.
After they nail launch.
After the Nail reusability, you then were making a future bet on Starlink, which was unclear, but the technology was proven and in just a couple of years that business went from zero dollars in revenue to over eleven billion
dollars in revenue and the largest constellation. I think you're seeing a similar inflection point now where you're betting on starship, you're betting on data centers in space, and you have early data and indications that many investors, including ourselves, are extremely confident in, and I think other people will see that same execution. That's basics is historically they're going to continue to do in the future.
They're doing this IPO. They need capital.
That's why you know he could in the end he got there when musc was speaking to Jamie Diamond, Well, we need capital.
How do you expect them to deploy?
That is a completely separate question, right The thing that's missing in their perspectus is where the Capex plans. What do you see happening in the first instance, Christian, I.
Think the company has been pretty consistent publicly and talking about of their plans. You know, Brett Johnson just did a great interview with the friend of ours of the firm having Makavin Baker, which was great and they talked a lot about one the infrastructures build out data centers, I think terrestrially, and you see with XAI, you know a lot of the Capex investments for that young company over the last couple of years that investors have been
trying to understand. And then obviously data centers in space is going to be a huge CAPEX investment, their continued investment starship development. But for the most part, I would say it's going to be heavily focused on data centers within the XAI business because.
That almost was what shops everyone right head in the S one the total addressable market more than twenty eight trillion dollars was like enterprise application.
It was AI was really where a lot of this is coming from.
Yeah, absolutely, I think the company really sees that business line being a massive opportunity and quite frankly, if you look at their advantages going after that, it's fundamentally driven by cost structure. Right, they have infrastruts, they have a platform, they can deliver capabilities at a lower costs and get
to scale that other people can't. And I think one of the great touch points for that is if you look at their Classes one and two data centers and you look at the business that they just launch on the compute side, they're giving you signal that terrestrially this can be a massive business. So in orbit, it will be a much much larger one. They're on a twenty six billion dollar run rate for their interrestrial compute business
and those are just two deals within a month. Imagine where this business is going to be in ten years.
I think there are questions from a lot of investors will hold on, why aren't you using that capacity for your own models, either training or on inference, and we will get to that. Christian Garrett, partner at one three to seven stays with us. One quick note, look at shares of rocket Lab actually down now about six percent. That was selling everywhere right when we started to get those indications of SpaceX. However, it was up in the
pre market. Nasdak announced it will be one of the five companies joining the Nasdaq one hundred index on June twenty second, And obviously like highly analogous with SpaceX, but the distant, small number two launch provider in the United States right now, and now.
We go back to the number one because coming up SpaceX is launching onto the public markets. But it's about far more than rockets. So we're just talking. We're going to delve ever more into this AI growth story.
This is bloombg Tech welcome back.
All in on this record SpaceX IPO, which we understand the shares are indicated to open at one hundred and sixty dollars per share, that is nineteen percent above the IPO price. Many Singh is our global head of tech research bloomg Intelligence, and he joins us along with Christian Garrett from one three seven Ventures, who has been investing round after.
Round, and SpaceX from the venture side.
Mandy, you're out with new research stating that xai could soon dominate SpaceX's sales by the end of the year.
This is an AI company. Walk us through.
You're thinking, yeah, I think the two recent deals and Tropic and Google. I mean they add almost twenty six billion dollars in recurring revenue, and we know cloud is a very high, stable margin business and so this is no different. You know, they have become a neo cloud AI infrastructure player overnight, and no one really saw this coming because the focus was clearly on the space launch
business and the starlink business. But I think the recurring revenue gives them a lot of stability in terms of driving that top line growth, and they're showing a lot of capex sufficiency. That's the other aspect about what they've done here.
So team, there's a discrepancy here, right. So Christian and the team at one three seven started investing when this was about reasonability and rockets. The pitch for this IPO is a future where the entire TAM basically twenty six point five trillion is enterprise AI. Your thesis is based on them being a neocloud running out capacity. When does GROC start making money? When do the models become valuable?
So that's where I think if they close the Cursor deal within the first thirty days, I mean that's huge in terms of improving rock model and coding agent is the real success story when you think about llms. That's where every frontier lab is making money. Guess what Cursor is the top asset outside of the frontier labs when
it comes to coding agents. So a huge acquisition. I think they will close it and that will really beef up you know the grock side of things where it's mostly consumer subscriptions and we know that's not the high growth drivers. It has to be Cursor.
I mean, Christian go up through the thinking for us because initially you need and reaction might be why.
Have they got spare capacity from that.
That was kind of my point.
Compute, if it's not being put and deployed into groquai, will they be able to have more and more to sell to Athropic, to Google and others, or they get's not using it themselves.
One of the fascinating things about the company is actually the speed that they've gotten this capacity of, and that changes the underwriting here. If you look at Colossus one and two, some of the fastest data centers built right within the ecosystem for these kind of neoclouds focused on
AI compute. Colossus three obviously a project that's coming online, and so I do think that what you're going to see is that they build these data centers faster, cheaper, and that gives them sphare capacity on the older ones to be able to offer it for the hyperscalar business.
And then companies like Cursor, which obviously the acquisition probably closes after the listing, and then the Grock models will give them their own kind of first part of the enterprise AI offerings that they can use that compute for. And I think a lot has publicly said that they want to work with their partners, you know, if demand drastically increases, they may take some of that capacity back
the older capacity. If you demand continues a scale, but they build capacity at a similar rate, then there's more than enough to go around for everyone. I think once again, it's just the company realizing what are their inherent advantages and it's really building infrastructure, and so I think that's fundamentally the that you want to make is can they build infrastructure, can they vertically integrate.
And cut costs?
And does that give them some advantage on these huge markets?
If you look inside the tin can and where the tin cans are a lot of differences between Colossus one and Colossus two and three. Bring it a bit more about that later, what happens next for the company. And you know, if you're high up the cap table as a VC that's been on the long journey, there's a lot of daylight between present day and the future. It's still all predicated on Starship working and being reusable.
How much do you think about.
That, Yeah, Starship's a huge piece of the equation. It's what unlocks you know, the Version three satellites for Starlink. It's what helps obviously unlock and be able to launch data centers in space. It's what gets to the Moon, is what gets the Mars. It's a very important piece to the platform. The businesses you see if you look at Starlink has just been built on the Falcon nine platform, right, if you look at their AI compute business.
That's terrestrial.
So there's a lot of scale for the business on just where they are today with the current sets of launch capabilities. But Starships is a huge a huge driver for that, and quite frankly, I think it's one of these things that is as an American and I think for everyone around the world, that you want to root
for because SpaceX is the launch provider for the entire world. Right, most of the world has works with them, and they are all on the same boat of really wanting this company to succeed because of what they've unlocked for I think the country here in the States and on our
allies as well. By bringing launch capacity back, Starship's going to take that to a next level where I think it's going to unlock not just new opportunities in new markets, but also help more and more businesses be formed in space. You know, the Falcon nine platform led to companies like Varda being formed. What happens when Starship, you know, reaches the kind of scale and capacity that SpaceX is targeting. What kind of businesses could be launched?
Then?
Right?
We have no idea?
Right, maybe instead of venture backed businesses, it turns out you can have small businesses and small business owners be able to build businesses in space.
This is a totally new world that we're entering in.
This is an ecosystem.
This is maybe fueled and more angel investing, more venture capital investing, but more founders as well.
But Mande the risks here?
What should an investor keep in mind as we await the first trade?
I mean, look, the valuation is already likely to exceed two trillion. So when I see that kind of market cap, even with the triple digit growth that I am baking in for the XAI side of things, I can't see you know how that you know, one point five trillion combined SpaceX and starlink valuation can be justified if my numbers for XAI are closed through you know, three to four hundred billion dollars with the growth rates. So I just find the valuation to be quite rich at this level.
A lot of people I know that are already on the cap tables say they're thinking about the evaluation in twenty thirty or twenty fifty, and they work backwards. Mandeep Singh Bloomberg Intelligence leads our research of technology. Christian Garrett Investment Partner at one three seven, one of the early and durable investors on the SpaceX cap table.
Coming up.
SpaceX's IPO marks one of the most significant wind pools in bention capital history. We're going to discuss who the big winners and the big names on that cap table are.
Character waiting with baited breath. But as we go to break, here's actually a.
Live look at what's really happening right here, right now. A panel Chevron CEO Mike Worsty there see, speaking with.
Amory Hold and Vern Houston follow along my lifego.
The supply was.
Shut off and so that's where you saw differentials getting very wide.
But subsequently you know you've got supplied.
Some of the venture firms that are back SpaceX.
Are set to earn tens of billions of dollars in returns today. They include founders Fund and recent Horowitze Koa Capital. Brinberg's Ventures reporter Rebecca Torrance joins us now. I mean it's paper money, but it's big money.
It's huge money.
And I think one of the most interesting things about this is that not just SpaceX's early backers are going to make a huge wind fall off of this, but even some of.
The late ones as well.
So so Koya and Reeson Horowitz both came in fairly late relative to the entire life cycle of this company, you know, the multi decade history, and yet stand to make tens of billions of dollars off of this IPO. Of course, the same is true for some of its early backers as well, and long time eland Musk allies, including Valor equity partners and founders fund.
Yeah, the founder's fund number, like you double check it fifty billion plus because you know, I was on stage with Tray Stevens the other day, one of the twelve investing partners at the firm. I think they did six hundred million over a many period of time. Like just talk about those two bigger beasts, right, So.
I mean, I think it is it's really fascinating to see how Musk's early allies continued to back him. Of course, you know, across the lifetime of this company. First investments around two thousand and eight, two thousand and nine, and of course has been many years since then. Some of these were folks back from the PayPal days, for example Peter Thiel and you know early investors that believes in musk and it's base x before the space economy really took off.
For Indreacing, this would be the biggest return in the firm's history doing both Rebecca Torrent's top job, Thank you very much. What does this IPO mean for other AI IPOs in the pipeline? Goldman SAX President and COO John Waldron thinks it's a step closer to a wave of listings.
Seventy five billion dollar ipo, the largest in history. I think it presages the beginning of a pretty sizable wave of IPOs, which we're excited about. I also think it shows you that the capital markets, led by the US capital markets, but the global capital markets, are demonstrating a willingness to finance this AI infrastructure build and this building space, which is quite exciting.
Pegas is founder in CEO and Isthuisman agrees, and it's invested in all three companies, SpaceX, Open AI and Anthropic.
How difficult is that to pick the winner. It is not that difficult.
Actually, I started investing in Spaceics first, and you know, I had a fantastic time, and you know, we continued seeing the growth of the Spacics. It was a space exploration company, and then started doing good in Sterling and Sterlink started expanding, and then came in open Ai and Nthropy and they were all you know, connected to each other in some sense. When Spacics started blooming, I think,
you know, we were feeling confident enough. When OpenAI came in, we invested in OpenAI and then we followed it anthrofit. So it happened one after another.
And there's room for all three.
Look, I've spoken to Thrive when they raised their last round, and they are ride or dies, just open Ai. They don't believe in spreading your bets like this. But is it okay that they're all kind of in on the same business model?
Here they are, But you know, AI is such a big market. I mean, there's so much opportunity. When we looked at OpenAI and they were doing good, at the same time, we found that, you know, Anthropy was focusing on more enterprise level, you know AI, so they're more focusing on the business to business side. They were more research oriented, so we felt that they have a different flavor. So you know, you like vanilized the same time you
like chocolate as well. So you know, we kind of like invested in two different types of you know, AI in productor we're also interested in XAI. So you know, we thought that we'll actually take part in every single angles of the domains that this companies are focusing on.
I think what's really interesting here, Ed, and I'm pranis to you is that, like if you think about Thrive, they're in SpaceX too, but at the time they weren't thinking of SpaceX as an AI company. Yeah, this has become quite a link power of play fore long.
Yeah, and it's you know, Christian Garrett from one three seven Ventures is with us and we're going to speak to him later in the hour.
Again.
You know, the idea here is that the thesis is constantly evolving with SpaceX.
You know.
But when I read the prospectus, the tam number, the story that they're pitching investors of the future, I bet you it's very similar to what Anthropic and Open AI right in their perspectives. That's difficult to market it is.
But you know, if you look at SpaceX, they're you know, I when I look at SPACEF I look at it as an AI energy and connectivity infrastructure conclom erate. You know, if you look at Starlink, I see the potential is huge. We have only ten million subscribed ten twelve million subscribers of space starlink right now. If you look at the number of Internet users in the world, there's six billion people using Internet and everybody is moving to sterling. So if you look at that way that Starlink has a
huge potential. Then you look at their plan for what they're trying to do. They're trying to create AI infrastructure in the orbit. They can do it because they have launch capability and they can do it at a minimum cost. So if you look at SpaceX, I mean they're playing a different tame. They're not only you know, thinking that they're going to become an AI company, but they're an
infrastructure company. Down the line, you'll be able to help open AI and anthropy as well, to be some kind of the backbone of the whole software AI development you're seeing right now.
Yes, briefly, SpaceX is one of your most significant positions valued it over a billion dollars as it stands, and is do you hold it for the long term?
I will hold it, actually, and I feel very positive that the starlink usage is going to grow significantly. Every single car, every single plane, every single person in the world, every big portion of the six billion Internet users are also going to come under starlink usage. And I feel that this company will grow at least thirty percent each year from here on for the next ten twenty years. And I want to hold it for the long term.
Pegas has fouan a CEO, and he Swusamon fantastic to have you staying up late for us.
You are.
We just get the latest indications of prices. SpaceX shares indicated to open ed at one hundred and fifty nine dollars ninety cents. That's eighteen percent above its IPO price. Coming up, we're delving evermore into spaces is Blockbuster Wall Street debut critical test for the company of Elon Musk and what is therefore he worth more than a trillion dollars if we hold onto this number, you've got the dilute.
Yeah, no, he would hear a trillion s status if it was one hundred and thirty eight dollars a share, so at one p ninety fully diluted, the company's worth two point two trillion, which say it out loud again, two point two trillion. Maybe we'll see there's a lot more to come. State of play. It's not yet trading. These are indications that we're getting ahead of the start of trading on the Nasdaq in New York City and in Texas where Elon musk folt this morning. And by
the way, markets are on a rocket ride today. A lot of volatility and if you look at different assets. Part of that story is I think some people are trying to work out how they have some liquidity to play the biggest side in history.
Enough puns that Lovelow not nearly enough puns bring them on.
Says Bloomberg Tech ely.
Welcome back to Bloomberg Tech, SpaceX and the biggest IPO in history. It's trading debut is imminent. First, the markets. We're now up almost a percentage point on the NASAK one hundred, but we have swung between gains and losses all morning, and there's a lot of evidence out there, along with geopolitical risk that people are searching for a plan on how they are going to play the IPO when trading starts if they didn't get an allocation on
the institution or the retail side. That's Part one, Part two. Elon Musk speaking earlier this morning at Star Based, Texas.
There are always problems on Earth. There are always problems on Earth.
There are always things that we wish to be better, that we want to solve here.
On Earth, and we should solve them.
But there also have to be things that get you excited about the future, that make you glad to wake up in the morning because you can't wait to see what happens next. And that's the future that SpaceX wants to bring to.
You, and the market can't wait to see what happens with the price indicated to make it the sixth most valuable player on the Nasdaq one hundred as and when it joins that benchmark, you hire an and you're at the Nasdaq.
What are you watching?
It seems like we're getting closer and closer to that first trade, Caroline. You've gotten a series of indications and they've continued to edge slightly lower as they continue to work through the price discovery process. The latest indication is one hundred and five fifty five dollars a share, that is up fifteen percent from the one hundred and thirty five dollars IPO price and implies a valuation of two
trillion dollars. That means SpaceX would still rank among the most valuable companies in the world, more valuable than the likes of Meta, Saudi Aramco, and even Tesla itself.
Blue Mix you a hire and and back throughout the hour, every blow by blow from the Nasdaq. SpaceX also recently unveiled a detailed look at an AI data center satellite SpaceX plans to build. It's a big development in the final days that drove this historic IPO. The record breaking seventy five billion dollar market debut is imminent. Bloomberg's chief Space correspondent, Lauren Grushes with us and still with us.
Christian Garrett One threw seven Manager a Ventures managing partner, investing partner, one of the sort of long term investors on the cap table at SpaceX as a private company and now as a public company.
Lauren out of this world right.
The whole point here is that SpaceX wants to get Starship right so it can deploy data centers in the form factor of a satellite. We have basically what a renderings that Elon mush shared with us the other day explain the basics of this. I know you don't have a degree in astrophysics, but well, I've.
Been covering the company long enough. I hopefully I've picked up some stuff along the way. No, but you said it. Starship is key to all of this, right, So, originally it was debuted as the vehicle that is going to fulfill SpaceX and Eli Musk's dream of sending people to Mars, and that's still the goal, but in the same time they're also putting all of their hopes and dreams on
this rocket as well. It's going to be responsible for launching the much larger, upgraded Starlink satellites, and then also it'll be crucial for sending humans to the Moon for NASA, and then of course it'll be the key that sends these data center satellites into space. So that definitely has to work, and it's had a bit of a rocky road of development up until now. It's also meant to be the first fully reusable rocket that's ever developed. I mean,
that is the holy grail of spaceflight. So if they can get it working, that will be key to all of the success. But that you know, win that will happen, how that will happen if things get descoped along the way. I think that's what we will be following now as SpaceX as a public.
Company, and we follow the price indications. SpaceX shares now indicated to open one hundred and fifty dollars as we stand, eleven percent above is IPO pricing. Christian, that's an enormous win for your venture fund and for the very early bets you took in this company. Does it give you any anxiety that the.
Business model just gets saying bigger and bigger and bigger.
I mean, talk to us about the orbital data centers and how swiftly you really think that can get going and almost them piece by piece, stress testing.
The potential of that.
Well, you know, I think historically the company has always set very very aggressive and ambitious timelines and goals, and
at times they've exceeded them. At times things take a little longer, but they've always delivered on what the ultimate goal and outcome was, and whether that was getting to partial re usability, whether that was building and launching the Starlink constellation starships, development timelines, figuring out the physics engineering around the Raptor engine, and so this is just another example where they've in my opinion, some of the best engineering teams in the world are at this company, and
they have high conviction on their ability to deliver on this, and they set timelines to start launching these things within the next couple of years. And so I think historically the data has always shown the company is always right, and sometimes they're early, sometimes they are late, but they are always righting these things. And I think that's a fair bet to make again here, and I think we're going to see fairly soon the build out start happening.
The plan is as early as twenty twenty eight for orbital day center deployment that was in the prospectus. I think what Christian's hinting at. But people phone me and say, is they see it happening sooner? But it's highly analogous with Starlink, So I think a lot of value Lauren, if you just catch up the Blombotech audience on the scale of Starlink today. That's not a space based data center, but it shows their competence in deploying satellites in constellation at scale.
Absolutely, And when SpaceX was first saying they were going to do Starlink, with the numbers that they were saying, I mean they had projected at first a twelve thousand plus constellation and now they have over ten thousand satellites working in orbit, and I think a lot of us were kind of wondering how that was actually going to play out. And then look, now they are operating this massive system. They are the world's largest global satellite operator today.
So I think they do have that advantage in being able to take the experience that they have from building and operating that Starlink system and they will apply it to this AI data center satellite. And that's and even Elon Musk said when he unveiled that design for the data center satellite is that he thinks it actually will be easier to design for. I don't know about that necessarily.
I mean, if you look at those solar panels, those are pretty big solar panels, and they've also talked about launching up to one million satellites.
That is a lot.
Not saying it can't be done, but I do think it does pose some engineering challenges, but as Gwynn said earlier, SpaceX likes to tout that they just take the impossible and they make it late.
Maybe the president's co SpaceX blooms Lauren Grush, thank you very much. Christian Garrett of one three seven Ventures stays with us. This is Bloomberg Tech, Friday, June twelfth, twenty twenty six. SpaceX is IPO, the biggest in history. Trading is imminent. SpaceX hasn't even started trading, and wool Street is already publishing price targets and U Street Research quick out the gate, initiating with a buy rating and a
one sixty five target price. The firm's valuation case leans heavily on the businesses that are already making money in space and how that cash gets funneled into AI.
Here's new streets. PF Feragu on Bloomberg Surveillance.
Space today is a lot of cash flow. It's very cash generative. So telecom business is generating a lot of cash. And if you have access to your own cash flow in AI, you can buy your own infrastructure.
That makes it much cheaper for you. You don't have to pay the margin.
Let's keep the SpaceX conversation going Nancy Tangler, CEO CIO of Leff and Tangler Investments and independent but historically bullished background mask of Tesla.
Do you want to.
Be buying SpaceX shares if they open one hundred and fifty dollars as they're currently indicated to do so.
Nancy, Caroline, we are buying them at the open, and it's not my preferred way of trading. I much rather have gotten an allocation. We're using the analogy to Amazon Public IPO in nineteen ninety seven. It was a company that was impossible to value because there were no earnings, only revenues, and this feels a lot more like that than it does Meta. So we're interested in owning it in our thematic portfolio, which has a theme of space,
and then also in our growth portfolio. So those are the options that those are the places where we are putting it.
Nancy, I wanted you to come on the program, and I'm speaking so honest with the Bloembo Tech audience because you're one of these investors of Tesla that gets access to the company.
Right.
I'm thinking about when you were at the Robotaxi launch event. Where do you stand. What is your thesis on the combination of SpaceX with Tesla.
Oh yeah, so, Ed, I do believe that is going to happen. I mean, Tesla already owned shares in SpaceX through the XAI acquisition. That's the space SpaceX made. So it's about a two billion dollar steak. It seems to me to be just a beginning. And already SpaceX is the most vertically integrated AI company if you think about they have the capital, they've got the data, they've got the large language models, they've got the hardware, the engineering talent,
the manufacturing talent. So we think it makes imminent sense for them to combine with Tesla. And I don't know if it's in twenty twenty seven or early twenty twenty eight, but I think you'll begin to see evidence of a tighter and tighter relationship as we move forward.
The public investor perspective, let's get the private investment perspective. Christian Garret went through some venture, is still with us. Do you think it makes strategic sense at least for Tesla and SpaceX, comebine.
I think the businesses have obviously a lot of commonalities, a lot of share projects, the Terrifat project being one example, and so you know, obviously, I think it's a great sort of discussion point to sort of theorize what would happen to these companies integrated together. I think they have a credible partnership as stands, and so in neither sent there, I think it's super exciting the work that they're doing together,
and for that to happen, it's exciting. If it doesn't happen, it's also exciting nonetheless, and both are obviously generational businesses.
We have live pictures from the Nasdaq. We believe that the trading of SpaceX in the United States is imminent, something that we've been discussing throughout the hour for actually to be fair for like days, Nancy Tengler is, if you've just put to one side the vision of the future and the twenty six point five trillion AI tam that SpaceX presented, how much does your team focus on the here and now of their data center business or neo cloud business that they've done with Anthropic and Google.
Yeah, I think it's important. By the way, I loved what Christian just said. It's exciting either way. I also love to headline on Bloomberg that said this company is cheap on a price to Cosmo ratio. So I think this is a name that is more of a narrative name for us than it is valuation. Our thematic portfolio does not focus on valuation. It focuses on obviously themes, and so I don't know how you quantify some of this. I think what's interesting is that the cash incinerator right
now is AI. But that is, as you just pointed out, twenty six point five percent of the TAM of twenty eight point five I'm sorry's twenty six point five trillion of the twenty eight point five tams. So I think you have to think about the data center business. It's what excites us to a great extent. But Starship, you know, as required as we know. I think they'll get there. I have no doubt they'll get there. It's just a question of when. So we're really buying the future when
we buy this company. In our time horizon is five to ten years.
And you are buying at the open.
Nancy Tanger of Leafa Tenger Investments a joy to speak with you today, Thank you very much. Indeed, look, we've got to get to bloembgs Bailey Lipschaltz, who has been driving the coverage of this IPO since we first got the confidential filings, the actual filings, and now we wait with baited breath.
We are but moments away from the opening trade, Bailey.
We are but moments away from a historic moment. And it's going to be fascinating to see if we do avoid a Facebook two point zero, and just to see how this not only opens, how it trades, and really when we start to see retail investors flowing through and placing those orders, what that ultimately looks like and does to the stock, just given the fact that this is going to be potentially pretty volatile.
It's so Bailey.
The latest indication indication of opening is one hundred and fifty dollars a share, eleven percent above the IPO price and implies a market value of roughly just two trillion.
Just you and I reported out the numbers.
Right on the retail allocation long only asset allocation. Somebody's going to be disappointed. How does that translate when we do start trading.
Everyone is disappointed. Let's just state it that way.
Everyone pretty much for a ontents and purposes, didn't get what they were hoping for. The big question now is does that drive follow through buying or does it irk people when they say, you know what, I'll just provide some liquidity, sell the stock, hopefully it a nice ten to eleven percent gain, and move on with my life. Because the big question when we do see these debuts is where does it open. Do we see steady follow through to the upside, and how does the volatility play out?
Are people holding on for massive gains, providing quick quick ins and outs, or is this something that we're going to be really tracking in the next week, in the next five trading days.
And I bring back Christian Garrett, of course isn't disappointed because he's been in this company from almost its birth, and you've been reallocating, upping the investment each and every round. We know lookups expiring about August, So what happens to your holding?
So us and alongside many of the investors who've been invested for a long time that are running institutional firms, I'll have the same dynamic where we will distribute back to our alps and let them make their own decisions. And within that, I think one of a lot of the articles that have come out which have been great really highlighting how large a position SpaceX is for a
lot of these institutional investors. And so you know, whether it's an endowments or a pension plan, whether it's you know, a friend or a family office or other different types of institutions, foundations, all these folks are going to end up receiving their distribution of the stock. And then many of them are not going to be selling right. Some may have liquidity needs, and I think that's a decision that each LP will make.
Something that you touched on earlier is critically important. We might get interrupted any moment, you know that, But like there have been regular liquidity events for SpaceX staff and employees. There will be more than four thousand millionaires minted at SpaceX from this transaction. They chose to stay, We've reported many of them tried to get more shares through the direct share program and otherwise speak to that, like what is that signal to you?
So SpaceX really pioneered the staying private for a longer trend.
Our firms started eleven really.
On the heels of Facebook, which we really is the first one, and SpaceX really took it obviously to another level. One of the dynamics that they did in order to stay private longer was offer regular locruity events for their employees. During that dynamic, over almost two decades, employees have had ample time to get liquidity and cover different needs. And
I think that's something that's underappreciated about the business. Is not just the impact they had on the venture ecosystem, right, So much of what we're experiencing is because of how much capital is flooded in as companies say private longer, but in particular, a lot of the employees have already had their chances of liquidity, and so as I mentioned, a lot of these folks are long term holders and are not selling as well.
We're getting excitement building from the floor of the Nasdaq as we await the opening trade of SpaceX, most recently indicated at one hundred and fifty dollars, rating it at about a market capitalization if you're looking at a fully dilated diluted basis of just under two trillion dollars, I make it the sixth biggest company on the nasat one hundred, just below Amazon, just above Broadcom and Bailey. You've been talking about how integral this is to the retail investor.
How much allocation do the retail investor get? How much did they get pump up the stock?
We reported a twenty percent, so about fifteen billion dollars, which is a large number, granted is we'd also reported they put in orders for about one hundred billion, So again a lot of people getting far less than they were expecting. And the big thing is going to be again, are these individual investors going to show up in size? If you put in for thirty thousand dollars worth of the stock and you've got five thousand, are you going to then still buy twenty five thousand in the open market.
The other thing to keep in mind too is the fact that I would say the vast majority of individuals use market orders. They don't set the price, they buy wherever they can.
Get filled, and most Bailey Lipshaltz, Christian Garrett one through seven ventures stay with us. Thank you both very much. SpaceX begins training today under ticker sp c X indications one hundred and fifty dollars a share, eleven percent premium on.
The IPO price of one thirty five.
They raised one hundred seventy five billion dollars largest IPO. Ever, the deal was so heavily oversubscribed, especially in the retail category. As Bailey outlined, Elon Musk promised loyal Tesla shareholders priority access to the SpaceX IPO for a long time.
But did they get it?
And how is Tesla's retail base reacting to SpaceX is listing. Alexandra Mertz, better known as test Labuma Mamma, one of Tesla's most prominent retail shareholders and investors that are active in the investor retail base, joins us. Now, my understanding is that you did not try and get an allocation in this IPO. That you won't try, alex stay put caro.
We have an opening trade.
SpaceX opens at one hundred and fifty dollars. That is an eleven percent increase on one hundred and thirty five dollars pricing. Extraordinary day ed you have followed this tick by tick, moment by moment, but we understand that an opening trade has come in at one hundred and fifty dollars shares open for SpaceX. Then as that crowd goes wild, there we are a.
Percent and where the IPO price at one hundred and thirty five, that's going to jump around. It's going to be a long few hours of trading. A market value of about one point ninety six trillion dollars, but on a fully diluted basis just a touch above two trillion. I think, I think we'll go live to the Nasdaq and Bloomberg's you hira and end you hira?
What are you seeing?
Hi? The moment is here, and there it is. SpaceX has officially begun trading, the stock opening at one hundred and fifty dollars a share above its one hundred and thirty five dollars IPO price, giving investors an immediate gain, as you guys said, of eleven percent. That opening price now values a company at approximately less than two trillion dollars, but instantly putting SpaceX among the most valuable companies in
the world. So, after a morning of shifting indications and intense anticipation with everyone here from the president of SpaceX the CFO, the market has finally delivered its first verdict on SpaceX. So now the focus will be whether those gains can hold. As trading gets underway.
Bloomboks Jahia and at the Nasdaq, SpaceX opened eleven percent above its IPO price of one hundred and thirty five dollars you see on the screen trading around one hundred and fifty two to fifty three dollars per share and on a fully diluted basis at a value of just a touch over two trillion. Let's keep the conversation going and get packed to Alexandra Mertz, a Tesla investor, a retail investor and also LNF Investor Services CEO. You didn't buy into this IPO. You have a thesis? Why yes?
And thanks for having me on this historic day and congratulation to the opening just when I was supposed to come on. Wasn't that funny?
Now back to my thesis.
My thesis is that Tesla and SpaceX will merge, and as all in Tesla investor, I would have had to sell Tesla, which I was not going to do. So my thesis is I'm going to hold these and in a couple of short weeks if I am right, they will announce this merger that will then be consummated in the first half of twenty twenty seven, and that Tesla shareholders will become SpaceX shareholders in this way, so no need for me to go into the IPO.
Alexandra, you are a long term Elon Musk fan. Elo Musk has become the world's first trillionaire. As SpaceX jumps at the open well above two trillion dollars in terms of market capitalization, he becomes the world's first trillionaire.
What do you think, Well, first of all, I'm not at all into this net worth porn. It's really something that I cannot get over. Elon Musk is a historic figure that is providing one hundred and forty thousand jobs, that has changed an industry in cars, an industry in space, that is going to change an industry in data centers. So whether he has a stock portfolio that's one trillion or not is just not relevant.
Now.
Having said that, what is relevant is the direct and indirect jobs he created and the many investors that he made rich, including many employees.
We're seeing real acceleration now in the shares.
We're at one hundred and sixty dollars per share shop about eighteen percent above the IPO price of one hundred and thirty five dollars a share, and a second I'll do the math on that. Alexandra Mertz outline her thesis that she believes a merger between SpaceX and Tesla is imminent. Bloomberg has not reported that. We did report prior to SpaceX merging with Xai privately that the boards of SpaceX and Tesla had discussed the idea.
We just don't know.
I'd also point out that this is much about not just economic ownership of SpaceX. Christian Garrett of one three seven Elon Musk has eighty four percent voting power post this trade. Why is that important to you as somebody that's been on the cap table for a long time.
I think any investment in SpaceX, whether it was in the private markets, which was our experience historically, and then now obviously the company and the public markets, and that's a shared experience among a lot of us now at the company's public This is a lot of company that has a long term view. They're investing in really transforming humanity across all these different verticals.
That Elon Musk is the swing factor.
And Elon's a huge swing factor the visionary and I think fundamentally, you basically want to have a company that you know is going to be focus on the long term, and so that gives us the ability because the company the ability to focus long term, and I think that's really the mindset you need to look at this. It actually brings stability to the company, which is what you want when you're investing in something that's going after a multi generational opportunity.
Alexandro, you go back to you because you have done years of due diligence on Tesla as a retail holder now one of the most vocal and well known retail investors on Tesla.
Put your view to the.
Retail investors trying to buy in to SpaceX, but whose friends around them are saying, have.
You looked to the corporate governance? Are you worried about the dominance and the voting rights that Elon Musk has. Is that a win or a loss from your perspective?
Well, first of all, retail shareholders were I'd be very privileged, especially the small ones. So I went through my followership this morning and lots of the smaller retail investors got actual one hundred percent of what they requested. So that is quite contrary to what Bailey said earlier. Now it is true the big portfolio of the retail investors had the less they got, which is corresponding to the promise that Elon made. He wanted to have loyal small retail
investors rewarded, and they got rewarded today. Now to the governance, I mean, it is clear that SpaceX is what I call Elon's imperium. He has rights like some other founder led megacaps that are just disproportional. Look at Google, look at Meta.
But the.
Retail shareholders who the last six years went through helen back with court cases, act with activists with whatever, they actually welcome this. They want the founder to have the power he deserves, especially in Elon's case. So I didn't hear any retail investor complaining about the governance in SpaceX. Rather the opposite. They would welcome that SpaceX is the entity that would absorb to so that the errors that were made in twenty ten with Tesla are finally out of the system.
We are up eighteen and a half percent, Alexandra Martz, But meanwhile Tesla trad's a little bit lower.
You're a Tesla.
Investor, Is that the right trade at the moment, sell Tesla buy into SpaceX.
Well, I did not, as you know, and I do believe that actually a lot of the money today will pour back into Tesla. The two retail groups overlap a lot. I'm sure about eighty percent. So the allocations that were not filled, I expect them today or on Monday pouring back into Tesla. So I'm not loorried at all.
Alexandra Martz, Tesla Investor shareholder, LLENF Investor Services CEO in Tesla boomer Mama is she's known online.
We appreciate it.
We got but a moment with the latest with Jahira and and that we're going to be going to in a moment where we're going to Christian Garrett of one three seven Ventures, he sat with us.
I mean, how does it feel You've been.
In this company for over a decade, You've invested round off the round. It's now trading seventeen percent higher than it's listening, christ.
It's an exciting moment.
And I have a lot of friends I know that are very excited as well. You have people kind of all around the world that have been a part of this journey, been a part of this company, from the employees to the management team to the investor base.
Excited for LPs.
This was my dad's favorite company, so I think that'd even more exciting, and so It's awesome to be a part of this moment, but quite frankly, I think this is very much a okay, let's get back to work and get focused because we have another forty years of work to do.
Christian Kahra, what a joy to have you here with us.
Thank you very much for being here for the aut real appreciate car.
Now we're going to say goodbye to Christian. I'm on through some ventures and welcome back in you hire. And and who is down in the Nastag? It's trading And how is the energy on the floor.
There is so much energy here at the Nasdag and it really started this morning and when we saw crowds of fans poparazzi here, some hoping to see Elon Musk, but of course he was over in Texas. But yeah, the enthusiasm continues. Now that that opening price does value the company at just under two trillion dollars, it of course instantly puts SpaceX among the most valuable companies, more
valuable than Meta, even Tesla itself itself, Saudi Aramco. And one of the people watching it all unfold here is this morning. This morning is naszac CEO A Dina Friedman, who has worked very hard pursuing this largest IPO in market history, and we are seeing her talk at this moment. So after a morning of just shifting indications and intense anticipation, it is finally here. The market has finally delivered its first verdict on SpaceX.
Bloombergs Yahara and and working hard on the beat than Asdak will see you throughout the day.
And what a day it is.
SpaceX the biggest IPO in history, raising seventy five billion dollars and right now we're trading around one hundred and sixty dollars a share.
How does it feel?
And you have been covering this company each step of the way, discussing with the investors, the wanna be investors, the retail allocations extraordinary, and every single moment Elon Musk was breaking the rules.
The way in which this.
Ipo highly unusual.
It was a typical set of price early then do a road show for no one really is sure why. What I would say is there is a long, long way to the future where humans are a multiplanetary species, and there is satellites around the Earth that are running inference their data centers. But in the near term. Everyone's now talking about how good the company is. A data center on Earth. Yeah, hyperscaling.
Yeah, what about what a blinder you keep calling it?
Yeah, they played a blinder.
And actually I'm just using the phrase that the people gave to me when they phone me up and they say, like, this is why we're so convicted. I have such conviction on the name. The last thing that will happen as well, well, not the last thing. Let's just be honest about this biggest IPO in history, raised seventy five billion dollars.
What happens next? They'll go back to the capital market.
So I bet you and I can't wait to be watching that.
But right now I have some news because after eighteen extraordinary years at Bloomberg, I'm actually pressing pause to have a wild and wonderful journey with my family. We're off to travel the world for a year, just the four of us, just four carry.
On bags and a whole load of excitement.
And it is with enormous gratitude that I want to thank this Bloomberg team for their support as I step away from my daily presenting. Look, the decision has not come easily. In fact, I'm pretty terrified to fly away from the most exciting news flow, the most fascinating interviews, and what I believe to be the most talented team in journalism. It feels almost insane, But time keeps ticking, the kids keep growing, and so I know this is our moment for our adventure of a lifetime. But I
also know Bloomberg has an extraordinary year ahead. No one tells the stories of disruption better than this Bloomberg tech team, and I can't wait to cheer on Bloomberg TV, Bloomberg News, and Bloomberg Originals as they continue breaking stories, landing interviews, winning awards. And it takes a village to bring news to wire, to television, to air events, to stage documentaries to life.
In fact, it takes three thousand.
Of us Bloomberg journalists and one hundred countries around the world. As we like to remind you, but I've lost count of how many people have trained me, mentored me, challenged me, collaborated with me, floor managed me, filmed me, and yes, beautified me along the way. And to everyone I've been lucky enough to learn from outside of Bloomberg, every spokesperson, every executive, every event organizer, every audience member, Yes you watching this.
Thank you you make this an absolute blast.
And a special thanks goes to the co anka I stand to sit next to you now ed the production team I hear guiding me in the control room, and the floor managers and the camera operators stood in front of me at this second. You're the best crew I could ever have hoped for, and I will miss you more than you could ever know. But it's time to swap studios for suitcases. With that, maybe it does it for this edition of Bloomberg Tech.
Ed Ludley, fifteen years to the day you and I met in London. You were the first person I met at Bloomberg and you made my career recap that show recap Caroline on the pod your where to find it from New York.
City, the biggest ipo in history. This is Bloomberg Tech