Elon Musk will become the world's first trillionaire.
Image: ALAIN JOCARD / AFP
ELON Musk started SpaceX in a warehouse, but on Friday the company moved far beyond its humble beginnings, making the biggest stock market debut in history and putting a price tag of $1.77 trillion on the rocket and satellite firm.
The listing places SpaceX among the world’s most valuable technology companies and shows just how strong demand has become from investors betting on the future of space travel and satellite internet systems like Starlink.
Speaking from Texas, Musk said it was “hard to believe”, adding that he had once given the company “less than a 10% chance of succeeding.”
Investors had been waiting for months for the listing, which was priced at US$135 per share in one of the most closely watched debuts in recent market history.
When trading opened on Friday, shares rose quickly to around US$150 as early demand pushed the price higher.
The company had said ahead of the listing that it would sell more than 555 million shares in the initial public offering.
The move is expected to push Musk’s wealth into unprecedented territory, and the worlds richest billionaire is now the world's first trillionaire. Several SpaceX employees are also expected to become dollar millionaires on paper.
The Pretoria-born entrepreneur said that if someone had told him years ago that a small warehouse startup would grow into the biggest stock market debut in history, he would have struggled to believe it.
Musk, who also founded Tesla and Starlink, started SpaceX in 2002 with the aim of bringing down the cost of space travel and opening the door to long-term human exploration beyond Earth.
Over time, that idea grew into something much bigger. Yesterday he said without SPACEX it was unlikely that humans would become “multiplanetary” species. He said he wanted to "take the fiction out of science fiction.”
But not everyone is convinced the excitement is justified.
Economist Dawie Roodt warned investors to be careful and not get swept up in the hype.
“I won’t buy now. This is just too hot,” he said. “When everybody is going ballistic… that is when you have to get scared.”
He said the price being placed on the company looked too high compared to what it is currently earning, and warned that excitement may be driving decisions more than reality.
“There’s no way you can pay that much for a company. It’s a loss-making company,” he said.
Roodt said small investors were likely to push the early momentum, while big global investment funds would only come in later once SpaceX is included in major global investment lists.
“And then the big investors will basically be forced to come in,” he said.
He also said the timing of the listing came at a moment when markets are still strong, but interest rates are expected to rise in major economies.
He warned that what feels like a rush of excitement now could cool down later.
“In the short term you can ride the wave. But in the longer term, I wouldn’t touch it,” he said.
In contrast, lawyer and economist Dr Bhasela Yalezo said SpaceX represented a strong opportunity driven by technology growth and confidence in Musk.
“For me, it will make a good investment at this stage because it’s expanding in the technology aspect,” he said.
He said the company’s future is tied to innovation in space travel and satellite communication.
“In terms of technology, it is the future,” he said.