SpaceX IPO
The trillion dollar magic trick
“The S-1 reads like a science-fiction novel”
Here is the S-1 ‘Big Short’ investor Steve Eisman is talking about: https://www.sec.gov/Archives/edgar/data/1181412/000162828026036936/spaceexplorationtechnologi.htm
It’s a business that wants to mine asteroids, build bases on the Moon and Mars, and claims its TAM (total addressable market) is more than double U.S. GDP, with most of that opportunity supposedly coming from artificial intelligence.
Its current operations are reportedly losing money in their core businesses, namely rocket launches and xAI. The only profitable side is the satellite internet business Starlink.
I recommend watching Patrick Boyle’s detailed breakdown of what’s going on:
Now with the IPO fast approaching, being more than 4x oversubscribed (supposedly), I want to mention my personal investment thesis: this process appears designed, at least in part, to personally benefit Elon Musk.
Let’s put the puzzle pieces together.
-In November of 2025, Tesla shareholders voted in favour of the $1 trillion pay package for Elon Musk:
The bonus wasn’t paid immediately. Musk needs to achieve aggressive milestones before receiving any of it, including: 20 million Tesla cars sold, 1 million robots, 10 million self driving subscriptions, $400 billion in core profit1. The most critical of these is lifting Tesla’s overall market value to $8.5 trillion from its current level around $1.4 trillion.2
-After aligning closely with the Trump administration in 2025 and co-leading DOGE, Musk appears to have secured regulatory flexibility to take SpaceX public under unusually tight share supply conditions. That limited float would naturally support a higher initial share price.
-Now here comes the important missing piece: the next logical step would be a merger or acquisition between Tesla and SpaceX. This scenario has been speculated about by many investors and analysts, with some even referring to the merged entity as “X.” I believe it is likely — and arguably necessary — if Musk is to fully unlock his Tesla compensation. I'm not predicting a merger will happen — I'm saying that if one is announced, that should set off alarm bells. 🚨
Tesla has struggled in recent years with sales plateauing since 2023. Notably, its biggest customer in certain segments has been SpaceX itself.
This wouldn’t be the first time Musk has pursued such a strategy: anyone remember the SolarCity and Tesla merger from exactly ten years ago?
To quote the abstract from this Harvard Business School piece: “Concerns were raised over possible conflicts of interest, given that Musk owned over 20% of the stock, and sat on the board of directors of both companies. The viability of the merger was also questioned given that neither Tesla nor SolarCity had ever been profitable.” https://www.hbs.edu/faculty/Pages/item.aspx?num=53652
So the merger/acquisition between SpaceX and Tesla might be what gets Musk the $1 trillion pay package from Tesla.
So the merger or acquisition could be what ultimately delivers Musk the $1 trillion pay package from Tesla. With majority voting control, he could help steer the transaction. That’s how I see the broader playbook unfolding. (Yes, I’m simplifying, but the pattern is recognizable.)
Déjà Vu
I know Elon Musk has passionate fans who see him as the real-life “Iron Man” — the mad genius taking humanity to the next level.
I hope I’m allowed to remain skeptical and call this IPO what it largely appears to be: a sophisticated capital raise that could primarily benefit insiders at the expense of new public investors, including pension funds chasing growth.
Who is right? I personally worry this could play out as described and hope that I am wrong.
Only time will tell.
The question I constantly ask myself: if he does manage to claim that $1 trillion and become the world’s first trillionaire, what comes next? Will he build his own country and declare himself emperor, or simply retreat to one of his space bases?
I see clear echoes of WeWork here — particularly its infamous S-1 that claimed it would “elevate the world’s consciousness.” The biggest losers then were SoftBank and its fund, backed by sophisticated Gulf investors who might have been better served sticking to real projects here on Earth rather than fabricated visions in the sky.
Just for everyone rushing to become a SpaceX investor: don’t bet the house. Caveat emptor.
[Note: I asked Grok from xAI to edit this piece… some derogatory remarks about Musk were requested to be removed]
Net income for Tesla was ~$4 billion in 2025, down 46% from 2024: https://assets-ir.tesla.com/tesla-contents/IR/TSLA-Q4-2025-Update.pdf
For comparison Tesla’s current market cap is $1.4 trillion or ~10x its sales and has been since its IPO in 2011. SpaceX current valuation is $1.85 trillion or ~100x sales.