How to Invest in SpaceX Stock
SpaceX has gone from being presumed to be a joke amongst the longstanding space companies, and NASA, to being the foremost company in space launches. SpaceX is likely to continue to be one of the most important companies in the world as it pushes the boundaries of space flight, human exploration, and reusable rockets. If you’re interested in investing in this growth by buying SpaceX stock, you’re not alone. This article will explore how to do this and more.
SpaceX is a unique company that’s confronting a very difficult challenge. In order to make an order of magnitude or better improvement in delivering goods and humans to space, SpaceX needs to bring the costs of launches down to 1/10th of what they were prior to SpaceX. That’s a tall order, but if anyone is up to the task Elon Musk seems to be the person. He’s an inexhaustible source of media attention and personality for the company, which has served to elevate it significantly with the public. Elon is a marketing genius, and his capabilities are on full display with the televised launches, public talk of putting humans on Mars, and phenomenal progress toward their goals that SpaceX has made.
One of the most interesting things about SpaceX’s decision to publicize launches and testing is that their failures are as widely discussed as their successes (sometimes more so). This has served to humanize the company though, and has endeared it to the public even more. SpaceX has a long term goal of putting the first humans on Mars, and they’re undoubtably in the lead to accomplish that feat. If successful, this will make SpaceX the defacto transport to the first human settlement on another planet. This will catapult its success to record heights.
So, how can you invest in SpaceX and own a piece of the company making history? That’s a more challenging task than simply purchasing some SpaceX stock. Is it possible to buy SpaceX stock? This article will explore that question and more.
The basics: What is SpaceX and why should you care?
If there’s one company that’s likely to make history by putting the first humans on another planet, it’s SpaceX. The company was founded by Elon Musk in 2002 and has since made a number of impressive achievements (see the SpaceX facts below). These milestones are all in the furtherance of one goal – putting humans on Mars. This is Elon Musks top goal, and if there’s one thing that he’s made clear, he tends to hit his goals.
What is Elon Musks SpaceX strategy?
Mr. Musk has been clear that his #1 goal in life is to put humans on Mars and make humanity a multi-planetary species. This is audacious, and critically important to long term human survival. Unfortunately, we’re one good pandemic or nuclear war away from annihilation, and Elon’s mission is to ensure that the destruction of Earth doesn’t equate to the destruction of humanity. If you assume that humans are worth saving, and most of us do, this is the only logical course of action.
Elon’s strategy for SpaceX is transparent – SpaceX is the launch and transportation entity for off-plane travel. It’s the vector for humans to get from Earth to Mars. When you begin to explore his other companies, a broader strategy emerges though. Vehicles will be required for the surface of Mars, and Elon’s other big company, Tesla, is revolutionizing electric cars. Further, the Cybertruck looks suspiciously like it could be adapted for cruising the surface of Mars. Tesla has made huge investments in battery technology and production, which will be critical to powering off-world living. Tesla also purchase Solar City, and with that acquisition got the Tesla Solar Roof. This technology will be critical to pulling electricity from the sun for a Martian city. Starlink, which is SpaceX’s new low-earth orbit satellite internet company, will be the way that Mars gets access to the internet without running fiber optic cables all over the planet. It seems that all of Elon’s investments are focused exclusively on the end goal of putting a human settlement on Mars.
What’s made SpaceX so successful?
There are many factors in SpaceX’s success, but the biggest is certainly the willingness to challenge any assumption. That is, the engineers often rethink their objectives using a “first principals” approach. That is, they consider the fundamental objective in light of the facts and nothing more. This has led to the development of rocket engines that land themselves and are reusable. It’s led to the development of modular thrust systems that bring the overall cost of production down. This strategy will continue to lead to unique and creative solutions that seem obvious in hindsight, but may not be if you only consider what’s been done historically. This sort of thinking should be adopted by every other organization.
Another thing that has made SpaceX successful is that it’s found a way to make itself impossible to ignore. When SpaceX was founded, none of the old guard in the space community took it seriously. That was a mistake that most will never recover from. SpaceX has found its way into NASA contracts by being the lowest cost bidder, delivering billions in revenue that legacy companies can’t possibly compete with. It’s also become a media darling thanks to Elon Musks masterful use of social media, video, and earned media to get his mission to the masses.
Lastly, SpaceX is successful because of it’s people. The company’s president, Gwynne Shotwell, has been an excellent leader for the day to day operations of the company – providing a steady hand that compliment’s Elon’s somewhat erratic behavior. SpaceX recruits people that believe deeply in the mission to put humans on Mars, and has been able to capitalize on that passion to produce great products.
How does SpaceX make money?
SpaceX currently makes money through contracted delivery of goods and humans to space. NASA has huge contracts with SpaceX to supply the International Space Station, and to deliver satellites to orbit. Private companies regularly contract with SpaceX to deliver their satellites to orbit as well. Since the company can launch faster, more reliably, and cheaper than their competitors, SpaceX has quickly grown to one of the largest space vehicle companies.
Is SpaceX profitable?
SpaceX doesn’t release audited financial statements, so it’s difficult to know exactly how profitable the company is. What is clear is that they generate billions in annual revenue, which has allowed for plenty of money to reinvest in their many research projects, like the SpaceX Starship. On a dollar/kilogram launched metric, SpaceX is the most profitable company in the space launch industry. The new Starlink internet product is likely to make SpaceX a massive sum of money, as it has the ability to deliver ultra-fast broadband to the most remote locations on earth. All of this adds up to SpaceX being extremely profitable on a gross basis, though with the research and development the company does, it’s hard to know if it’s producing any net profit yet.
Top 10 SpaceX facts you should know:
- Elon Musk founded SpaceX with the proceeds of the acquisition of PayPal where he was in the company’s leadership. After PayPal was acquired, he simultaneously made a huge investment in Tesla and has been running both companies ever since.
- Since its inception, SpaceX’s explicit goal has been to send the first humans to Mars, and establish a colony there.
- SpaceX was the first company to land a used rocket booster using propulsion.
- SpaceX was the first company to successfully reuse an orbital rocket.
- SpaceX famously launched a Tesla roadster into orbit with the Sun. You can view the last live video before the signal was lost by clicking here, and view the current position of the Roadster in orbit by clicking here.
- SpaceX was the first private company to launch a liquid propellant fueled rocket to orbit.
- SpaceX was the first private company to dock at the International Space Station.
- SpaceX has been testing it’s Starship, which will be used to ferry goods and people to Mars.
- SpaceX mission control is in their headquarters location in Hawthorne, California.
- Starlink Internet is now available in every corner of planet Earth. It has reached speeds of up to 500 Mbps download with sub 20 millisecond pings – dramatically faster than most wired consumer internet.
How to invest in SpaceX:
How can I invest in SpaceX stock?
SpaceX is a privately held US-based company. As such, it’s not listed on any public stock exchange and members of the public are not generally able to invest. However, it may be possible for accredited investors to make investments in SpaceX, if they can find someone willing to sell it. SpaceX recently raised $1.9 billion, and with its massive revenue growth, it’s unlikely that new rounds of funding will be needed for the foreseeable future.
SpaceX is funded by private angel and venture capital groups. Limited partners in those funds could have an opportunity to participate in SpaceX venture rounds, but they are extremely competitive and difficult to get a piece of.
When will SpaceX IPO?
SpaceX has not announced any plans to IPO, and Elon Musk has said that he doesn’t intend to take the company public any time soon. This is because it would subject SpaceX to the requirements of being a public company which are not conducive to the long term goal of putting humans on Mars. When companies are publicly traded, their fates can often be at the whims of the stock market, and stock market investors are often focused on short term gains, rather than long term goals. That’s particularly true when the long term goals are not explicitly profit motivated, like Elon’s goal of putting humans on Mars.
Of note however, SpaceX president Gwynne Shotwell, has said that they are considering spinning out the Starlink division of SpaceX and doing an IPO on it alone. That would be a highly anticipated offering, and would generate massive returns for SpaceX, and their investors. If Starlink IPOs, this page will be updated to reflect that.
What is SpaceX’s valuation?
Since SpaceX is a public company, it’s impossible to know exactly what it’s valuation is. Recent funding rounds peg SpaceX’s valuation at around $48 billion, though some investors believe SpaceX’s valuation could be as high as $200 billion as of 2021.
Are there any other ways to invest in SpaceX stock?
For those who are accredited investors, there may be other opportunities to purchase SpaceX stock. An accredited investor is defined as an individual with $1 million or greater, exclusive of their primary residence, or an income of $200,000 per year for three of the last 5 years or greater. With Accredited Investor status, you can invest in private businesses like SpaceX, make angel investments, participate in hedge funds, and other risky investments.
To invest in SpaceX, accredited investors can keep an eye on secondary market platforms like EquityZen, and ForgeGlobal. Sometimes employees and other investors will post their shares for sale on these platforms, though SpaceX shares are likely to be extremely popular.Conclusion: SpaceX may be one of the most important companies for the future of the human race. It’s very difficult for average investors to buy SpaceX shares though, as the company is privately held. Further, SpaceX is not planning to IPO anytime soon, though their Starlink Internet product may be spun out into its own IPO. Those who are accredited investors may also be able to purchase SpaceX shares on secondary market platforms. Be sure to keep an eye on those if you meet that qualification as they’re likely to be extremely popular.
Click to view the BankDeets reading list.