SpaceX is preparing to go public and begin trading its shares on the stock exchange. Among the terms of the offering are massive compensation packages that Elon Musk is set to receive. But this will only happen if he builds a city on Mars.
SpaceX’s IPO
SpaceX is going public and offering its shares on the market. There had been talk of this for several years, but it has been a confirmed fact for several weeks now. The event is scheduled for June 4, and on Wednesday, May 20, company owner Elon Musk finally revealed the details of the offering to potential buyers.
An eccentric billionaire announced this event with incredible fanfare, linking it to the issue of preventing the extinction of humanity. In his view, this can be achieved by building a city on Mars, creating orbital data centers, and other fantastical accomplishments.
SpaceX is the first company founded by Elon Musk, whose net worth is estimated at $839 billion. He founded it in 2002 and has been in full control of its management ever since. While the company’s total value is quite high, profits are distributed extremely unevenly within the company.
On the one hand, it includes Starlink, which generated $4.4 billion in revenue last year. On the other hand, it includes the loss-making media platform X and the artificial intelligence developer xAI. Last year, they spent $6.4 billion on the latter. And most importantly, there’s the main rocket manufacturer. It has a $6 billion order book from the U.S. government.
What will Elon Musk receive, and when?
Of course, Musk’s ultimate goal is to convince everyone that he is bringing something truly valuable to the market. Even if the shares are sold at face value (assuming he manages to sell them all), his net worth should rise to one trillion dollars.
However, potential buyers are also expected to be extremely wealthy, as the proposal includes plans to build massive data centers in orbit, a colony on Mars, and to increase SpaceX’s market value to $7.5 trillion. At the same time, Musk takes on a lot of responsibility, as he is to receive compensation for all of this in the form of 15 tranches of 67 million shares each, which he will receive only upon the completion of certain milestones.
Of course, Musk has no intention of sharing control of his own business. Proof of this is that he has allocated special-class shares—each carrying 10 votes—to himself and a few other shareholders. But at least it seems that he is genuinely committed to carrying out his ambitious plans.
Although, perhaps he simply wants the several hundred billion dollars that selling his shares would bring him right now. After all, he was the main sponsor of Donald Trump’s election campaign, and many are asking whether we shouldn’t look into how fairly SpaceX secured those military contracts, on which the company’s value now depends.
According to phys.org
