1 00:00:00,240 --> 00:00:07,200 Speaker 1: Boo, Bloomberg Audio Studios, podcasts, radio news. 2 00:00:08,920 --> 00:00:11,800 Speaker 2: Twenty twenty six is shaping up to be a landmark 3 00:00:11,880 --> 00:00:16,480 Speaker 2: year for high profile IPOs. AI giants. Anthropic and OpenAI 4 00:00:16,880 --> 00:00:19,400 Speaker 2: are both expected to go public later this year, with 5 00:00:19,520 --> 00:00:23,599 Speaker 2: valuations projected to be hundreds of billions of dollars. But 6 00:00:23,640 --> 00:00:27,000 Speaker 2: twenty twenty six's most memorable stock market debut could kick 7 00:00:27,040 --> 00:00:30,120 Speaker 2: off as early as this week, when Elon Musk's company 8 00:00:30,200 --> 00:00:34,040 Speaker 2: SpaceX files the paperwork to go public. How big a 9 00:00:34,040 --> 00:00:37,440 Speaker 2: deal is this IPO? The numbers being floated are certainly ipopping. 10 00:00:37,840 --> 00:00:41,239 Speaker 1: How big a deal? The biggest deal ever? Literally? 11 00:00:41,720 --> 00:00:45,280 Speaker 2: Ed Ludlow, co host of Bloomberg Tech, says SpaceX hopes 12 00:00:45,320 --> 00:00:48,720 Speaker 2: to raise more money than any other company in history. 13 00:00:48,920 --> 00:00:52,479 Speaker 1: What we're reporting is up to seventy five billion dollars. 14 00:00:52,520 --> 00:00:55,240 Speaker 1: It kind of started at thirty billion dollars, then fifty 15 00:00:55,280 --> 00:00:57,640 Speaker 1: billion dollars, than seventy five billion dollars. 16 00:00:57,920 --> 00:01:01,160 Speaker 2: The previous record was twenty five point six billion dollars 17 00:01:01,360 --> 00:01:04,200 Speaker 2: raised by Saudia Ramco back in twenty nineteen. 18 00:01:04,560 --> 00:01:07,560 Speaker 1: You know, it's astronomic sums, but the whole point is 19 00:01:07,560 --> 00:01:10,920 Speaker 1: that it's all predicated on a pitch for this kind 20 00:01:10,959 --> 00:01:12,840 Speaker 1: of future space economy. 21 00:01:12,640 --> 00:01:15,880 Speaker 2: And that future space economy needs a lot of cash. 22 00:01:16,000 --> 00:01:19,679 Speaker 1: They need that capital because you know, the future business 23 00:01:19,720 --> 00:01:21,880 Speaker 1: model for SpaceX has changed. They want to build data 24 00:01:21,920 --> 00:01:24,200 Speaker 1: centers in space. And it doesn't matter if a data 25 00:01:24,200 --> 00:01:26,600 Speaker 1: center is in space or it is on Earth. The chips, 26 00:01:26,640 --> 00:01:29,399 Speaker 1: the GPUs that go into it, that they cost tens 27 00:01:29,400 --> 00:01:31,600 Speaker 1: of billions of dollars and that's a big focus it. 28 00:01:35,920 --> 00:01:37,800 Speaker 2: I'm David Gera and this is the big take from 29 00:01:37,800 --> 00:01:41,959 Speaker 2: Bloomberg News today on the show SpaceX is possible record 30 00:01:42,000 --> 00:01:45,040 Speaker 2: setting IPO, what it means for the business of space, 31 00:01:45,280 --> 00:01:48,120 Speaker 2: why the company wants to give retail investors a chance 32 00:01:48,160 --> 00:01:50,840 Speaker 2: to buy in, and how Elon Musk could become the 33 00:01:50,840 --> 00:01:59,600 Speaker 2: world's first trillionaire. After its IPO, SpaceX will be up 34 00:01:59,600 --> 00:02:02,800 Speaker 2: there with the largest publicly traded companies in the world, 35 00:02:03,120 --> 00:02:08,400 Speaker 2: the ones that are worth thirteen digits. There's chip maker Nvidia, Alphabet, 36 00:02:08,480 --> 00:02:13,000 Speaker 2: Google's parent company, and Microsoft. Ed says SpaceX could seek 37 00:02:13,120 --> 00:02:17,400 Speaker 2: a one point seventy five trillion dollar valuation. What gives 38 00:02:17,440 --> 00:02:21,000 Speaker 2: SpaceX at this moment the confidence that investors will support 39 00:02:21,000 --> 00:02:23,239 Speaker 2: that valuation, that the public markets will. 40 00:02:23,280 --> 00:02:25,680 Speaker 1: First of all, you either do or you don't believe 41 00:02:25,720 --> 00:02:29,120 Speaker 1: in a future where instead of being large tin cans 42 00:02:29,120 --> 00:02:32,840 Speaker 1: on Earth, data centers in the form factor of satellites 43 00:02:33,280 --> 00:02:35,800 Speaker 1: are the best way forward. You know, the argument is 44 00:02:35,840 --> 00:02:39,480 Speaker 1: basically that in the vacuum of space, heat dissipation and 45 00:02:39,520 --> 00:02:44,760 Speaker 1: thermal dynamics not an issue. Energy electricity, well, there's infinite sun. 46 00:02:44,880 --> 00:02:47,280 Speaker 1: The sun is always on in space, David, and so 47 00:02:47,880 --> 00:02:50,440 Speaker 1: it's a very sort of whimsical, so the argument, but 48 00:02:50,520 --> 00:02:53,280 Speaker 1: that's basically what those that believe in the economics of 49 00:02:53,320 --> 00:02:55,919 Speaker 1: this would put forward, and investors buy it right. They 50 00:02:55,919 --> 00:02:59,520 Speaker 1: believe that even though Elon Musk's kind of skill is 51 00:02:59,560 --> 00:03:03,320 Speaker 1: to look keep investors looking to the horizon, he does 52 00:03:03,400 --> 00:03:06,200 Speaker 1: often in the end get to the bold plans that 53 00:03:06,240 --> 00:03:08,480 Speaker 1: he outlines, even if the timeline's kind of off. That's 54 00:03:08,560 --> 00:03:12,839 Speaker 1: part of it. You know. SpaceX absolutely dominates all of 55 00:03:12,880 --> 00:03:16,440 Speaker 1: the payload from Earth to orbit. They have changed the 56 00:03:16,520 --> 00:03:20,640 Speaker 1: economics of space launch. And if any of this future 57 00:03:20,680 --> 00:03:23,280 Speaker 1: business of space based data center is going to succeed, 58 00:03:23,840 --> 00:03:26,360 Speaker 1: they will have to prove out or keep proving out 59 00:03:26,680 --> 00:03:30,239 Speaker 1: the reusability in economics on a dollar per per kilo 60 00:03:30,360 --> 00:03:33,240 Speaker 1: basis of what they're already doing and there's a lot 61 00:03:33,280 --> 00:03:35,080 Speaker 1: of belief that that won't change. 62 00:03:36,160 --> 00:03:38,680 Speaker 2: Ed Elon Musk started SpaceX more than twenty years ago, 63 00:03:38,720 --> 00:03:40,280 Speaker 2: and I think there are probably a lot of listeners 64 00:03:40,560 --> 00:03:42,200 Speaker 2: who will think this is a company that still just 65 00:03:42,200 --> 00:03:45,160 Speaker 2: builds rockets and shoots them into space. But the reality 66 00:03:45,320 --> 00:03:49,240 Speaker 2: is this has become a massive, sprawling conglomerate. What does 67 00:03:49,280 --> 00:03:51,320 Speaker 2: SpaceX encompass in the year twenty twenty six. 68 00:03:51,680 --> 00:03:54,800 Speaker 1: Yeah, in the year twenty twenty six, SpaceX still dominates 69 00:03:55,200 --> 00:03:58,920 Speaker 1: the launch of rockets into orbit and the transfer of payload, 70 00:03:59,080 --> 00:04:02,880 Speaker 1: both a non human payload from Earth into orbit, like 71 00:04:03,000 --> 00:04:06,920 Speaker 1: they are the number one launch provider, but more recently 72 00:04:06,960 --> 00:04:09,440 Speaker 1: their business, the kind of money side of it has 73 00:04:09,480 --> 00:04:15,160 Speaker 1: been about Starlink, a constellation based internet where you, much 74 00:04:15,240 --> 00:04:18,000 Speaker 1: like you would subscribe to your internet provider here on Earth, 75 00:04:18,160 --> 00:04:21,520 Speaker 1: you pay a subscription. It's just that the technology relies 76 00:04:21,560 --> 00:04:26,200 Speaker 1: on satellites in orbit and ground receivers. And that has 77 00:04:26,240 --> 00:04:29,360 Speaker 1: been the most recent shift where revenues have gone from 78 00:04:29,400 --> 00:04:34,960 Speaker 1: majority being either government or private customers paying for SpaceX 79 00:04:35,000 --> 00:04:37,080 Speaker 1: to put their gear on a rocket and send it 80 00:04:37,080 --> 00:04:40,479 Speaker 1: into orbit, to now starlink becoming a bigger chunk of it. 81 00:04:40,640 --> 00:04:43,160 Speaker 1: And so the next phase, and the IPO is all 82 00:04:43,200 --> 00:04:47,839 Speaker 1: about the evolution of that from constellations focused on Internet 83 00:04:47,880 --> 00:04:50,880 Speaker 1: and starlink to constellations that are data centers. 84 00:04:51,400 --> 00:04:53,920 Speaker 2: Is this principally what's motivating the company to go public 85 00:04:54,240 --> 00:04:57,719 Speaker 2: at this moment, that kind of growth that you're describing, it's. 86 00:04:57,600 --> 00:05:01,120 Speaker 1: The money, you know. Elon Musk is like I've always 87 00:05:01,200 --> 00:05:05,200 Speaker 1: been relatively candid about how he feels about life as 88 00:05:05,400 --> 00:05:08,640 Speaker 1: a CEO of a public company, the scrutiny that a 89 00:05:08,640 --> 00:05:12,240 Speaker 1: public company faces, and you know, for the longest time 90 00:05:13,000 --> 00:05:16,279 Speaker 1: keeping SpaceX private and in some of his other ventures 91 00:05:16,320 --> 00:05:19,200 Speaker 1: private separate from Tesla, which is a public company, that 92 00:05:19,360 --> 00:05:22,880 Speaker 1: was the priority. But the frank reality was that when 93 00:05:23,160 --> 00:05:27,320 Speaker 1: the idea of a space or orbital data center became 94 00:05:27,640 --> 00:05:31,800 Speaker 1: sort of clearly the business plan, then they needed the capital. 95 00:05:31,880 --> 00:05:35,479 Speaker 1: And to get capital that volume right, you need to 96 00:05:35,520 --> 00:05:39,320 Speaker 1: pull off at a financial mechanism like an IPO of 97 00:05:39,360 --> 00:05:39,920 Speaker 1: that scale. 98 00:05:40,400 --> 00:05:43,279 Speaker 2: You have this company that is building and shooting up rockets, 99 00:05:43,800 --> 00:05:47,080 Speaker 2: has this very successful starlink side of the business, and 100 00:05:47,120 --> 00:05:50,600 Speaker 2: then it goes about and acquires Xai, another Elon Musk property. 101 00:05:50,839 --> 00:05:53,359 Speaker 2: What was the rationale for that and how hard a 102 00:05:53,400 --> 00:05:55,760 Speaker 2: sell is it? To investors who are looking at the 103 00:05:55,760 --> 00:05:59,159 Speaker 2: prospect of this IPO and wondering if in this environment 104 00:05:59,600 --> 00:06:03,400 Speaker 2: backing company that is so squarely centered on AI makes 105 00:06:03,400 --> 00:06:04,039 Speaker 2: a lot of sense. 106 00:06:04,520 --> 00:06:08,360 Speaker 1: Yeah, In simple terms, Xai is a company that develops 107 00:06:08,560 --> 00:06:12,000 Speaker 1: AI large language models, right is the common parlance that 108 00:06:12,080 --> 00:06:17,000 Speaker 1: people have become accustomed to. XAI essentially does exactly what 109 00:06:17,040 --> 00:06:20,520 Speaker 1: open Ai and Entropic do. They train models and then 110 00:06:20,560 --> 00:06:24,400 Speaker 1: they offer products. In their case it is a generative 111 00:06:24,440 --> 00:06:28,839 Speaker 1: AI tool and other more enterprise focused products around GROCK 112 00:06:29,480 --> 00:06:32,559 Speaker 1: and so quite rightly, people are like this, this is nuts. 113 00:06:32,600 --> 00:06:37,400 Speaker 1: Why would SpaceX do this with Xai beyond elon bringing 114 00:06:37,400 --> 00:06:40,960 Speaker 1: his different interests under one umbrella and bringing them into 115 00:06:41,000 --> 00:06:44,560 Speaker 1: one entity. And it's the idea that, well, what is 116 00:06:44,640 --> 00:06:50,159 Speaker 1: constraining those companies developing AI is compute. The constraint is 117 00:06:50,200 --> 00:06:52,599 Speaker 1: that there is not enough data center capacity on Earth. 118 00:06:53,000 --> 00:06:55,240 Speaker 1: One way to solve for that is to put them 119 00:06:55,240 --> 00:06:58,680 Speaker 1: in orbit in space, and so you have SpaceX. That 120 00:06:58,760 --> 00:07:02,599 Speaker 1: is the modus operandi by which that compute gets into orbit. 121 00:07:03,240 --> 00:07:06,640 Speaker 1: It will build and design the satellite form factor data centers. 122 00:07:06,720 --> 00:07:09,280 Speaker 1: But XAI is the user, and we're not talking at 123 00:07:09,320 --> 00:07:12,800 Speaker 1: that point about training models. We're talking about infernt running 124 00:07:12,800 --> 00:07:16,080 Speaker 1: the models, running vast amounts of data and compute and 125 00:07:16,120 --> 00:07:19,160 Speaker 1: beaming it back down to Earth. And so actually, from 126 00:07:19,200 --> 00:07:22,120 Speaker 1: that standpoint, if you are saying that in the first instance, 127 00:07:22,120 --> 00:07:25,080 Speaker 1: your own customer, it does make a lot of sense 128 00:07:25,120 --> 00:07:27,480 Speaker 1: to investors, and investors were happy to back it. 129 00:07:28,360 --> 00:07:30,160 Speaker 2: You report on this stuff day in and day out, 130 00:07:30,320 --> 00:07:33,360 Speaker 2: and data centers in space still sounds kind of fantastical 131 00:07:33,480 --> 00:07:36,960 Speaker 2: to me. I'm wondering how much the conversation has shifted, 132 00:07:37,440 --> 00:07:39,720 Speaker 2: maybe in part because Elon Musk is talking about this 133 00:07:39,800 --> 00:07:42,560 Speaker 2: so much to that being maybe not a given, but 134 00:07:42,600 --> 00:07:45,160 Speaker 2: what SpaceX and other companies are shooting for here. 135 00:07:45,440 --> 00:07:48,720 Speaker 1: It sounds far fetched and fantastical to a lot of people. 136 00:07:49,440 --> 00:07:51,440 Speaker 1: There is still a lot that needs to happen to 137 00:07:51,440 --> 00:07:55,280 Speaker 1: make this a reality. And it's one reason why we 138 00:07:55,920 --> 00:08:01,080 Speaker 1: so closely track Starship. So Starship is SpaceX is future 139 00:08:01,120 --> 00:08:06,520 Speaker 1: generation launch system and rocket. And basically the math that 140 00:08:06,720 --> 00:08:10,280 Speaker 1: all of the investors and analysts and industry do is 141 00:08:10,360 --> 00:08:13,800 Speaker 1: the economics of Starship. First of all, Starship hasn't really 142 00:08:13,840 --> 00:08:16,680 Speaker 1: ever completed even a test mission end to end. In 143 00:08:16,720 --> 00:08:19,960 Speaker 1: other words, it's never launched from Earth, got to orbit 144 00:08:20,240 --> 00:08:23,280 Speaker 1: done something real in terms of deployer payload and then 145 00:08:23,320 --> 00:08:26,240 Speaker 1: come back down to Earth. They've run experiments, but they 146 00:08:26,240 --> 00:08:29,120 Speaker 1: need to do that, and the math that needs to 147 00:08:29,160 --> 00:08:32,680 Speaker 1: be done is the long term future of Starship. On 148 00:08:32,720 --> 00:08:35,480 Speaker 1: a dollar per kilo basis, how much does it cost 149 00:08:35,800 --> 00:08:38,840 Speaker 1: to put Starship into orbit in deployee payload and then 150 00:08:38,880 --> 00:08:41,280 Speaker 1: bring it back down to Earth safely and in one 151 00:08:41,320 --> 00:08:44,800 Speaker 1: piece so it can be reused again. Until that happens, 152 00:08:45,320 --> 00:08:48,559 Speaker 1: nobody can model for the viability of space based data 153 00:08:48,559 --> 00:08:52,680 Speaker 1: center because, as SpaceX would tell it themselves, only Starship 154 00:08:52,800 --> 00:08:57,120 Speaker 1: is capable of putting these satellite data centers into orbit. 155 00:08:57,160 --> 00:09:00,120 Speaker 1: There isn't anyone else with a rocket or the the 156 00:09:00,240 --> 00:09:03,560 Speaker 1: technical know how to do it, and so we're waiting 157 00:09:03,600 --> 00:09:04,520 Speaker 1: on that big moment. 158 00:09:05,480 --> 00:09:08,079 Speaker 2: I think of Tesla, a public company. You've listened to 159 00:09:08,160 --> 00:09:10,440 Speaker 2: quarterly earnings calls. I have as well. I think that 160 00:09:10,720 --> 00:09:14,400 Speaker 2: Elon Musk's distaste for those is sometimes palpable on those calls. 161 00:09:15,080 --> 00:09:18,600 Speaker 2: But the broader question here is how much Elon Musk's 162 00:09:18,679 --> 00:09:21,559 Speaker 2: vision is at odds with what a public company has 163 00:09:21,600 --> 00:09:24,160 Speaker 2: to do. So he has dreams of data centers in space, 164 00:09:24,200 --> 00:09:27,240 Speaker 2: He has dreams of colonizing Mars. These are very medium 165 00:09:27,280 --> 00:09:30,960 Speaker 2: to long term goals for him. How does he square 166 00:09:31,000 --> 00:09:32,880 Speaker 2: that or how difficult is it for him to square 167 00:09:32,920 --> 00:09:36,079 Speaker 2: that with the necessary kind of quarterly reporting targets that 168 00:09:36,120 --> 00:09:37,200 Speaker 2: the public company has. 169 00:09:37,520 --> 00:09:41,520 Speaker 1: The one counter argument to that is that while Tesla 170 00:09:41,600 --> 00:09:44,480 Speaker 1: is a public company is owned by some of the 171 00:09:44,559 --> 00:09:49,000 Speaker 1: largest financial institutions on the planet, a meaningful proportion of 172 00:09:49,040 --> 00:09:53,600 Speaker 1: the shareholder base is everyday people retail investors who are 173 00:09:54,480 --> 00:09:58,079 Speaker 1: huge backers of Elon Musk, right. And the reason that 174 00:09:58,080 --> 00:10:00,959 Speaker 1: that's interesting is, like the latest report hoarding from Bloomberg 175 00:10:01,840 --> 00:10:05,640 Speaker 1: and others, is that when this spacexipo happens, a really 176 00:10:05,640 --> 00:10:08,200 Speaker 1: big chunk of the offering will go to retail investors. 177 00:10:08,880 --> 00:10:12,440 Speaker 1: And what Musk has always said is that he values 178 00:10:12,520 --> 00:10:15,719 Speaker 1: those retail investors of Tesla. He often will say they 179 00:10:15,720 --> 00:10:19,360 Speaker 1: have a better understanding of how the company works beyond 180 00:10:19,360 --> 00:10:21,880 Speaker 1: that of the cell side analyst, for example, or even 181 00:10:21,920 --> 00:10:25,120 Speaker 1: the institutional shareholder who holds the stock in a fund 182 00:10:25,200 --> 00:10:28,400 Speaker 1: on behalf of clients and the wider public. And so 183 00:10:28,480 --> 00:10:32,560 Speaker 1: he wants to reward that loyalty. But that is completely 184 00:10:32,640 --> 00:10:36,719 Speaker 1: separate from a bigger question, which is is it sensible 185 00:10:37,040 --> 00:10:41,520 Speaker 1: logical and efficient that Tesla, SpaceX, and Xai all co 186 00:10:41,600 --> 00:10:45,160 Speaker 1: exists as one company, because actually, historically they've always worked 187 00:10:45,240 --> 00:10:48,520 Speaker 1: very closely with one another. There's always been crossover between them, 188 00:10:48,760 --> 00:10:51,120 Speaker 1: and so the other argument if you're a shareholder is well, 189 00:10:51,280 --> 00:10:53,520 Speaker 1: if you own one, it's just logical to own the 190 00:10:53,559 --> 00:10:54,360 Speaker 1: rest of it as well. 191 00:10:55,600 --> 00:10:59,320 Speaker 2: Coming up the timetable through this highly anticipated IPO and 192 00:10:59,320 --> 00:11:10,120 Speaker 2: what it will mean for the world's richest man when 193 00:11:10,160 --> 00:11:13,200 Speaker 2: SpaceX goes public later this year. The company is reportedly 194 00:11:13,240 --> 00:11:16,520 Speaker 2: targeting June it'll be eligible for a new fast tracked 195 00:11:16,679 --> 00:11:20,480 Speaker 2: entry to the NASDAQ one hundred. On Monday, NASDAK announced 196 00:11:20,520 --> 00:11:23,320 Speaker 2: it'll shorten the waiting period for new listings to just 197 00:11:23,440 --> 00:11:26,360 Speaker 2: fifteen days, a move widely seen as a way to 198 00:11:26,440 --> 00:11:30,120 Speaker 2: drink companies like SpaceX to the exchange. But even with 199 00:11:30,200 --> 00:11:32,520 Speaker 2: a fast track to the market and so much investor 200 00:11:32,559 --> 00:11:36,079 Speaker 2: excitement about the company, Ed says, what SpaceX is trying 201 00:11:36,120 --> 00:11:38,000 Speaker 2: to pull off is difficult. 202 00:11:38,280 --> 00:11:41,439 Speaker 1: This is a big, big IPO, and so it's entirely 203 00:11:41,480 --> 00:11:45,360 Speaker 1: possible that the IPO gets delayed, it gets kicked back, 204 00:11:45,480 --> 00:11:48,439 Speaker 1: you know, further into twenty twenty six, even next year. 205 00:11:48,960 --> 00:11:52,440 Speaker 1: But that's the mechanics of it. The bigger picture is, 206 00:11:52,600 --> 00:11:56,960 Speaker 1: you know, SpaceX is a closely held company, a private 207 00:11:56,960 --> 00:12:02,600 Speaker 1: company where Elon Musk doesn't have the majority of volume 208 00:12:02,640 --> 00:12:07,040 Speaker 1: attic ownership, but he does have incredible voting power. And 209 00:12:07,080 --> 00:12:09,920 Speaker 1: then you have some very interesting financial institutions on the 210 00:12:09,920 --> 00:12:12,559 Speaker 1: cap table, venture capital firms that have been in there 211 00:12:12,600 --> 00:12:16,200 Speaker 1: early since day one, founder's fund. And so SpaceX decides 212 00:12:16,240 --> 00:12:17,840 Speaker 1: with its bank is how much of this company it's 213 00:12:17,880 --> 00:12:19,720 Speaker 1: going to offer, and as we discussed a moment ago, 214 00:12:19,800 --> 00:12:20,920 Speaker 1: like how much of this is going to go to 215 00:12:20,920 --> 00:12:24,600 Speaker 1: the retail investor? And all of that impacts the market right. 216 00:12:24,920 --> 00:12:28,560 Speaker 1: The other reporting is that SpaceX kind of is gunning 217 00:12:28,600 --> 00:12:31,600 Speaker 1: for some prestige. It would like to go straight into 218 00:12:31,640 --> 00:12:36,120 Speaker 1: the SMP five hundred, which would take some consideration by 219 00:12:36,120 --> 00:12:38,920 Speaker 1: the committees overseeing the s and P five hundred and 220 00:12:38,960 --> 00:12:42,800 Speaker 1: the Umbrella Organization to make by law and rule changes. 221 00:12:43,200 --> 00:12:45,760 Speaker 1: That is something that would be consequential for the markets. 222 00:12:45,800 --> 00:12:48,439 Speaker 1: And again it's only with time that will know if 223 00:12:48,440 --> 00:12:51,680 Speaker 1: that's achievable or not. In this timeframe of an IPO 224 00:12:51,760 --> 00:12:53,360 Speaker 1: in the middle of twenty twenty six. 225 00:12:53,720 --> 00:12:56,439 Speaker 2: You've talked to executives as I have with companies way 226 00:12:56,480 --> 00:13:00,640 Speaker 2: and going public and timing is so critical. Look around 227 00:13:00,720 --> 00:13:02,720 Speaker 2: the world at the uncertainty with what's happening in the 228 00:13:02,760 --> 00:13:06,280 Speaker 2: Middle East, the general logita among investors about the US 229 00:13:06,280 --> 00:13:09,320 Speaker 2: economy and the global economy. What would this company say 230 00:13:09,720 --> 00:13:11,520 Speaker 2: to that, maybe this isn't the right moment for this 231 00:13:11,559 --> 00:13:13,239 Speaker 2: to happen because there is so much uncertainty. 232 00:13:13,720 --> 00:13:16,880 Speaker 1: You can look at different data sets that would either 233 00:13:16,960 --> 00:13:19,600 Speaker 1: evidence or dispute the psychology of the market. There's a 234 00:13:19,600 --> 00:13:22,400 Speaker 1: lot of big names in financial markets right now saying 235 00:13:22,440 --> 00:13:26,119 Speaker 1: that investors should put a little bit more into cash, 236 00:13:26,360 --> 00:13:28,880 Speaker 1: and it's interesting to see some of the commentary attached 237 00:13:28,920 --> 00:13:31,720 Speaker 1: to that saying they're not saying that because of safety 238 00:13:31,800 --> 00:13:34,560 Speaker 1: and because of the conflict in war in Iran. They're 239 00:13:34,600 --> 00:13:36,719 Speaker 1: saying it because you need to get ready for a 240 00:13:36,760 --> 00:13:40,440 Speaker 1: big SpaceX IPO and have some liquidity to participate and 241 00:13:40,440 --> 00:13:42,720 Speaker 1: buy a big block of shares. That's kind of interesting. 242 00:13:43,400 --> 00:13:47,480 Speaker 1: SpaceX has had no difficulty in attracting capital in the 243 00:13:47,559 --> 00:13:51,960 Speaker 1: private markets now. The one sort of pause for thought 244 00:13:52,280 --> 00:13:54,880 Speaker 1: is that it's not only SpaceX that's looking at the 245 00:13:54,920 --> 00:13:59,040 Speaker 1: public market window. Right You have open AI that at 246 00:13:59,120 --> 00:14:04,840 Speaker 1: its last prime valuation post money eight hundred and thirty 247 00:14:04,880 --> 00:14:08,080 Speaker 1: to fifty billion dollars, So what would its public valuation be? 248 00:14:08,480 --> 00:14:12,400 Speaker 1: You have anthropic also waiting in the wings. Considering an IPO. 249 00:14:13,160 --> 00:14:15,640 Speaker 1: In some sense it's an issue of chronology. One goes 250 00:14:15,679 --> 00:14:19,240 Speaker 1: first and the rest follow. The others are that it's competitive, right, 251 00:14:19,320 --> 00:14:21,600 Speaker 1: You are asking for the same capital from the same 252 00:14:21,640 --> 00:14:24,240 Speaker 1: types of people, and it's the same types of banks 253 00:14:24,240 --> 00:14:26,680 Speaker 1: on the top lines of these deals working on all 254 00:14:26,720 --> 00:14:29,800 Speaker 1: these different IPOs. It's a competitive landscape. Some people see 255 00:14:29,800 --> 00:14:31,960 Speaker 1: it as a starter gun. Others see it as if 256 00:14:32,040 --> 00:14:34,680 Speaker 1: the environment more broadly is difficult. Maybe they all hit 257 00:14:34,720 --> 00:14:37,600 Speaker 1: pause or they're waiting for somebody to go first. 258 00:14:38,840 --> 00:14:40,760 Speaker 2: Ed when allis said and done, how much of this 259 00:14:40,800 --> 00:14:42,720 Speaker 2: company is Elon Musk likely to own? 260 00:14:43,240 --> 00:14:46,760 Speaker 1: There's a difference between saying what percentage of a company 261 00:14:47,040 --> 00:14:50,320 Speaker 1: does one own? Financially speaking, you know Elon from a 262 00:14:50,400 --> 00:14:54,240 Speaker 1: voting power perspective, he has absolute control as it stands 263 00:14:54,280 --> 00:14:57,760 Speaker 1: with SpaceX, along with its board and the board observers 264 00:14:57,760 --> 00:15:00,760 Speaker 1: that get board observer status through having a more meaningful 265 00:15:00,840 --> 00:15:04,000 Speaker 1: ranking on the cap table. So that's an interesting part 266 00:15:04,000 --> 00:15:06,000 Speaker 1: of it. When racing to pull up on my Bloomberg 267 00:15:06,080 --> 00:15:08,840 Speaker 1: terminal how much of Tesla Elon Musk currently owns. But 268 00:15:08,880 --> 00:15:12,240 Speaker 1: remember that he's embarking at this moment in time, over 269 00:15:12,280 --> 00:15:16,160 Speaker 1: the next decade on a compensation plan that was designed 270 00:15:16,280 --> 00:15:19,080 Speaker 1: all told, not just to compensate him with a trillion 271 00:15:19,120 --> 00:15:22,040 Speaker 1: dollars of economic value, but with much more voting power 272 00:15:22,080 --> 00:15:24,320 Speaker 1: as well. So for him, that's what it's all about, 273 00:15:24,680 --> 00:15:28,560 Speaker 1: and he is argued in voting control so that he 274 00:15:28,600 --> 00:15:31,520 Speaker 1: can execute on the bigger picture that he believes these 275 00:15:31,920 --> 00:15:35,120 Speaker 1: companies are going after, which is changing. It shifts all 276 00:15:35,120 --> 00:15:37,400 Speaker 1: the time. At the moment, you know what Elon Ink 277 00:15:37,520 --> 00:15:40,080 Speaker 1: is trying to achieve, But that's his argument. If he 278 00:15:40,120 --> 00:15:42,600 Speaker 1: doesn't have the voting power, he won't be able to 279 00:15:42,600 --> 00:15:44,840 Speaker 1: execute on it because he'll be vulnerable to the will 280 00:15:44,920 --> 00:15:48,480 Speaker 1: of activist investors and other regulatory bodies. 281 00:15:49,080 --> 00:15:51,520 Speaker 2: When this idea of an IPO first came up, there 282 00:15:51,600 --> 00:15:53,240 Speaker 2: was a lot of attention on what it would mean 283 00:15:53,320 --> 00:15:56,280 Speaker 2: for Elon Musk's personal net worth. He's already the world's 284 00:15:56,360 --> 00:15:58,840 Speaker 2: richest man, of course, what will it do? How much 285 00:15:58,840 --> 00:16:01,120 Speaker 2: does he stand to make here? And what is Elon 286 00:16:01,240 --> 00:16:04,000 Speaker 2: Musk's broader goal amassing all of this money? What does 287 00:16:04,040 --> 00:16:05,600 Speaker 2: he want to spend all of that money on. 288 00:16:06,040 --> 00:16:08,120 Speaker 1: As Elon Musk would tell it, his goal is not 289 00:16:08,240 --> 00:16:11,720 Speaker 1: to amass all that money. The overriding goal of SpaceX 290 00:16:11,800 --> 00:16:16,520 Speaker 1: was to make human kind a multiplanetary species. In other words, SpaceX, 291 00:16:16,560 --> 00:16:19,400 Speaker 1: in very simple terms, would take humans from Earth to 292 00:16:19,760 --> 00:16:22,840 Speaker 1: the future Mars and in the interim the Moon. And 293 00:16:22,880 --> 00:16:25,960 Speaker 1: that's something that he genuinely believed in. What he is 294 00:16:26,120 --> 00:16:29,120 Speaker 1: good at is framing it in the context of his 295 00:16:29,160 --> 00:16:31,760 Speaker 1: ability to raise funding for those bigger picture of goals 296 00:16:31,840 --> 00:16:35,120 Speaker 1: rather than serve his own net worth. Right now, he 297 00:16:35,240 --> 00:16:37,520 Speaker 1: is worth about six hundred and fifty billion dollars right 298 00:16:37,520 --> 00:16:40,040 Speaker 1: according to Bloomberg Data, So he's the world's richest person, 299 00:16:40,560 --> 00:16:44,800 Speaker 1: but through the financial mechanism of a SPACEXIPO. Taking the 300 00:16:44,880 --> 00:16:49,520 Speaker 1: paper value of his SpaceX ownership after a public offering, 301 00:16:49,800 --> 00:16:51,760 Speaker 1: you know what people talk about is him being the 302 00:16:51,800 --> 00:16:57,080 Speaker 1: first individual trillionaire, right having a trillion dollars of personal wealth. 303 00:16:57,360 --> 00:17:01,040 Speaker 1: He also has a ten year compensation plan TESLA, set 304 00:17:01,080 --> 00:17:03,840 Speaker 1: against mandatory goals. He has to hit all those things 305 00:17:03,840 --> 00:17:06,639 Speaker 1: to get the comp but the economic value of the 306 00:17:06,680 --> 00:17:10,000 Speaker 1: award is one trillion dollars total depending on the share 307 00:17:10,040 --> 00:17:12,880 Speaker 1: price going with him in the trajectory that he wants 308 00:17:12,880 --> 00:17:15,680 Speaker 1: to take the company. So, yeah, six hundred and fifty 309 00:17:15,680 --> 00:17:18,320 Speaker 1: billion dollars right now. And you know, let's say if 310 00:17:18,359 --> 00:17:20,240 Speaker 1: you and I are still doing this in ten years time, 311 00:17:20,760 --> 00:17:23,320 Speaker 1: the idea is that he'll be the multi trillionaire. 312 00:17:24,320 --> 00:17:27,640 Speaker 2: So we've got this looming IPO. We have the Artemis 313 00:17:27,680 --> 00:17:30,639 Speaker 2: launch scheduled for this week. Yeah, what could this IPO 314 00:17:30,720 --> 00:17:33,439 Speaker 2: signal about investments in the space sector more broadly? 315 00:17:33,880 --> 00:17:39,439 Speaker 1: Broadly, investment in space is strong right now, particularly in 316 00:17:39,520 --> 00:17:42,800 Speaker 1: private market backing. When we say investment in space, that 317 00:17:42,840 --> 00:17:45,439 Speaker 1: can mean a lot of different things. You know, within 318 00:17:45,560 --> 00:17:51,120 Speaker 1: space there are categories launch, different rocket providers propelling payload 319 00:17:51,160 --> 00:17:54,600 Speaker 1: from Earth to orbit. Actually there's less focus there. You know, 320 00:17:54,680 --> 00:17:57,440 Speaker 1: all of the banks do research. Morgan Stanley is one 321 00:17:57,480 --> 00:18:00,359 Speaker 1: that's done a lot of research on the potential all 322 00:18:00,720 --> 00:18:04,480 Speaker 1: multi trillion dollar addressable market in space. But that encompasses 323 00:18:04,560 --> 00:18:08,800 Speaker 1: everything from you know, literally communications via satellite, Internet like 324 00:18:08,880 --> 00:18:12,320 Speaker 1: stylin kids, the value of data generated in space. There's 325 00:18:12,359 --> 00:18:14,800 Speaker 1: this idea that here on Earth, for example, a farmer 326 00:18:15,320 --> 00:18:18,840 Speaker 1: in any given geography is made more efficient and better 327 00:18:18,880 --> 00:18:22,600 Speaker 1: served by what a satellite can see in orbit versus 328 00:18:22,640 --> 00:18:24,600 Speaker 1: anything that can be generated on the ground, and that 329 00:18:24,640 --> 00:18:27,520 Speaker 1: can fundamentally change the economics of all kinds of industries, 330 00:18:27,720 --> 00:18:31,840 Speaker 1: agriculture being one, and so that's the direction of travel here. 331 00:18:32,320 --> 00:18:34,920 Speaker 1: The thing is about the SpaceX IPO. Bringing it back 332 00:18:34,920 --> 00:18:37,840 Speaker 1: to what we're talking about today, it's how much does 333 00:18:37,880 --> 00:18:40,679 Speaker 1: that suck the oxygen out of the room because investors 334 00:18:40,760 --> 00:18:44,159 Speaker 1: know that SpaceX is way ahead of many others that 335 00:18:44,200 --> 00:18:46,600 Speaker 1: are chasing it in those domains, and they want to 336 00:18:46,640 --> 00:18:48,760 Speaker 1: concentrate their focus on that single name. 337 00:18:54,960 --> 00:18:57,440 Speaker 2: This is the Big Take from Bloomberg News. I'm David Gera. 338 00:18:57,760 --> 00:19:00,080 Speaker 2: To get more from The Big Take and unlimited access 339 00:19:00,119 --> 00:19:03,040 Speaker 2: to all of Bloomberg dot com, subscribe today at Bloomberg 340 00:19:03,080 --> 00:19:06,560 Speaker 2: dot com slash podcast offer. If you liked this episode, 341 00:19:06,640 --> 00:19:08,720 Speaker 2: make sure to follow and review The Big Take wherever 342 00:19:08,720 --> 00:19:11,120 Speaker 2: you listen to podcasts. It helps people find the show. 343 00:19:11,560 --> 00:19:13,400 Speaker 2: Thanks for listening. We'll be back tomorrow.