As the world's eyes are fixed on Elon Musk's ambitious venture, SpaceX, is set to make history by going public in 2026, potentially raising over $30 billion in the largest IPO in history. But should you invest? Experts weigh in on the potential risks and rewards of investing in this privately held company.
For Daniel Maguire, an associate chartered accountant at ARK Invest, SpaceX's technological lead is a significant advantage. "They've landed a booster 10 years ago and executed almost perfectly on reusability since," he notes. This gives them a head start over competitors like Blue Origin, which is still trying to catch up. Additionally, SpaceX's Starlink internet connectivity offers direct-to-cell coverage in dead zones around the globe, making it an attractive option for mobile networks.
However, Maguire warns that valuation and timing are crucial factors to consider. "Every investor has a different financial situation and risk tolerance," he advises. Educating yourself about SpaceX is essential before investing. ARK Invest has developed an open-source valuation model to help investors assess the company's worth.
On the other hand, Jay Ritter, director of the IPO Initiative at the University of Florida, cautions that SpaceX's massive size and valuation could be a concern for investors. "The vast majority of shares are sold to institutional investors," he notes. The offer price is likely to jump on the first day of trading, making it difficult for individual investors to buy in at a reasonable price.
Ritter also points out that SpaceX's growth rate is uncertain. If the company does go public at an estimated valuation of $800 billion with revenue of $15.5 billion in 2025, the price-to-sales ratio would be 51.6, which is historically a red flag for investors. "From 1980 to 2021, there have been only 13 companies going public with a price-to-sales ratio over 40 that have underperformed the market during their first three years," he warns.
Meanwhile, Kimberly Siversen Burke, director of government affairs at Quilty Space, emphasizes the importance of timing. "An IPO before Starship is operational would dump technical risk and schedule uncertainty onto public investors," she notes. On the other hand, an IPO after Starship's launch would allow SpaceX to sell execution instead of aspiration.
Burke also highlights the long-term implications of SpaceX's plans for space-based data centers. While these centers could potentially generate revenue in the future, they are commercially unproven and capital-intensive. It's essential to consider whether these projections are based on a real business case or AI valuation scaffolding.
Lastly, Matthew Weinzierl, professor at Harvard Business School, emphasizes that each of us is already invested in SpaceX, albeit indirectly. From GPS to telecommunications, space exploration has become an integral part of our daily lives. As the dominant company in space today, SpaceX's success will have far-reaching implications for innovation and national security.
Ultimately, investing in SpaceX requires careful consideration of valuation, timing, and execution risks. While experts agree that the company has significant technological advantages and potential, it's crucial to educate yourself about the company's worth before making a decision.
For Daniel Maguire, an associate chartered accountant at ARK Invest, SpaceX's technological lead is a significant advantage. "They've landed a booster 10 years ago and executed almost perfectly on reusability since," he notes. This gives them a head start over competitors like Blue Origin, which is still trying to catch up. Additionally, SpaceX's Starlink internet connectivity offers direct-to-cell coverage in dead zones around the globe, making it an attractive option for mobile networks.
However, Maguire warns that valuation and timing are crucial factors to consider. "Every investor has a different financial situation and risk tolerance," he advises. Educating yourself about SpaceX is essential before investing. ARK Invest has developed an open-source valuation model to help investors assess the company's worth.
On the other hand, Jay Ritter, director of the IPO Initiative at the University of Florida, cautions that SpaceX's massive size and valuation could be a concern for investors. "The vast majority of shares are sold to institutional investors," he notes. The offer price is likely to jump on the first day of trading, making it difficult for individual investors to buy in at a reasonable price.
Ritter also points out that SpaceX's growth rate is uncertain. If the company does go public at an estimated valuation of $800 billion with revenue of $15.5 billion in 2025, the price-to-sales ratio would be 51.6, which is historically a red flag for investors. "From 1980 to 2021, there have been only 13 companies going public with a price-to-sales ratio over 40 that have underperformed the market during their first three years," he warns.
Meanwhile, Kimberly Siversen Burke, director of government affairs at Quilty Space, emphasizes the importance of timing. "An IPO before Starship is operational would dump technical risk and schedule uncertainty onto public investors," she notes. On the other hand, an IPO after Starship's launch would allow SpaceX to sell execution instead of aspiration.
Burke also highlights the long-term implications of SpaceX's plans for space-based data centers. While these centers could potentially generate revenue in the future, they are commercially unproven and capital-intensive. It's essential to consider whether these projections are based on a real business case or AI valuation scaffolding.
Lastly, Matthew Weinzierl, professor at Harvard Business School, emphasizes that each of us is already invested in SpaceX, albeit indirectly. From GPS to telecommunications, space exploration has become an integral part of our daily lives. As the dominant company in space today, SpaceX's success will have far-reaching implications for innovation and national security.
Ultimately, investing in SpaceX requires careful consideration of valuation, timing, and execution risks. While experts agree that the company has significant technological advantages and potential, it's crucial to educate yourself about the company's worth before making a decision.
people seem to be getting carried away with the hype around Elon Musk's SpaceX going public 
. $30 billion is just crazy 
. I mean what makes me nervous is that they're projecting huge growth rates but have no idea how they'll execute those plans 
. And what about all these "long-term implications" and "commercially unproven" projects 
.
. Be smart about your money 
?
, I'm all for innovation and pushing boundaries like Elon Musk is doing with SpaceX, but investing in them before they're even operational sounds sketchy to me 
. They've got some awesome tech going on, but are they really ready for the big leagues? I mean, those Starlink internet speeds sound amazing 
! As Matthew said, we're already invested in SpaceX, whether we know it or not 
. So maybe instead of throwing our hard-earned cash at them, we should just enjoy watching the show and see how it all plays out 
.
What if SpaceX can't compete with other companies like Blue Origin or... wait, do we even know what their business model looks like yet? 
. It's all about weighing those risks vs rewards 
The Starlink internet thing seems cool and all, but it's still a relatively new service... do people really need this kind of connectivity? 
when it comes to reading news about SpaceX going public. Can you imagine how epic the IPO prospectus would be? 
.
It's so refreshing to see a thoughtful analysis without just throwing numbers around 
Maybe it'll be all about showcasing their innovative technology and sustainable practices 
)
. But at the same time, I'm like "hold up, how much are we talking about here?" $30 billion is wild 
. It's crazy to think that SpaceX's success will have far-reaching implications for innovation and national security 
.
? I mean, have you seen the price-to-sales ratio? 51.6?! That's just crazy talk 
. And don't even get me started on the technical risks and schedule uncertainty 
". You can't just predict how SpaceX will do after going public. They're still a privately held company, for crying out loud! 
Their valuation is insane, but so is the potential reward if they succeed. I'm not sure I'd take that risk even with all the tech advantages they have 
). What if Starlink doesn't take off like they hope? Or what if space-based data centers don't pay off as expected? It's a high risk, high reward situation. I'm not saying you shouldn't invest at all... but make sure you do your research and know what you're getting into