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The SpaceX IPO: a16z’s David George & Elon Musk’s $1T 6/12/26
00:37:58
SpaceX is now publicly traded on the Nasdaq. Andreessen Horowitz General Partner David George bet on Elon Musk in 2021, and he’s still betting on him–and SpaceX. Venture capitalist Ben Narasin considers the potential future of the stock and what it could mean for other IPOs (like Anthropic and OpenAI) that are also set to list this year. CNBC’s Robert Frank reports on the numbers that will make Elon Musk the world’s first trillionaire. CNBC’s Morgan Brennan shares highlights from her interview with SpaceX President Gwynne Shotwell, and Elon Musk addresses his employees and investors ahead of the company’s first trade. Morgan Brennan - 3:47 David George - 10:59 Ben Narasin - 19:47 Robert Frank - 30:19 Elon Musk - 37:07 In this episode David George, @DavidGeorge83 Robert Frank, @robtfrank Morgan Brennan, @MorganLBrennan Melissa Lee, @MelissaLeeCNBC Joe Kernen, @JoeSquawk Andrew Ross Sorkin, @andrewrsorkin Cameron Costa, @CameronCostaNY
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- [00:00]
Fidelity App Voice
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- [00:27]
Keith Lansford
This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and subscribe@schwab.com Market Update podcast or find Schwab Market Update wherever you get your podcasts.
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Cameron Costa
This is Squawkpod and I'm CNBC producer Cameron Cameron Costa. On Today's episode, the SpaceX IPO lifts off.
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Elon Musk
If people had told me this was gonna happen, I was like, man, you must be smoking some really good crack.
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SpaceX Launch Announcer
2, 1. Ignition engines full power. And liftoff of Falcon 9. Go SpaceX. Go Starlink. To all SpaceXers new and old, let's see what's out there.
- [01:28]
Cameron Costa
Occupy Mars Andreessen Horowitz, General Partner David George took a bet on SpaceX back in early 20 and he is still betting on Musk.
- [01:38]
David George
The way I think about Space X is this is the best entrepreneur of our generation in Elon and he's going after two of the biggest markets of all time, space and AI.
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Cameron Costa
And what can we expect after the first trade? What it might mean for the mega IPOs still to come like Anthropics and OpenAI's Tenacity Ventures.
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Ben Narrison
Ben Narrison if SpaceX doesn't fly, you're going to see a huge stall for everything else. And it can put a true chill on the market if it pops. Everybody is just popping champagne.
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Cameron Costa
So we're awaiting the first trade and we're awaiting the world's first trillionaire. CNBC's wealth reporter Robert Frank is crunching the numbers.
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Robert Frank
It all depends on SpaceX shares staying above $140 a share probably.
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Cameron Costa
It is Friday, June 12, 2026 and Squawk Pod begins right now
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Ben Narrison
in 3, 2, 1.
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SpaceX Launch Announcer
Q please.
- [02:38]
Melissa Lee
Good morning and welcome to Squawk Box here on cnbc. I'm Melissa Lee along with Joe Kernan and Andrew Ross Orkin. Becky's off today.
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Joe Kernan
Some Context on the SpaceX IPO trading set to begin later today. We told you the company raised $75 billion in its offering, the most ever. Prior to that, 71 IPOs had already priced this year and those altogether raised $36 billion, which is less than half of SpaceX's haul. If we get another mega IPO this year like Open Air Anthropic, the total would likely obviously skyrocket again.
- [03:09]
Melissa Lee
Plus, he prepared for Space X's IPO CEO Elon Musk took some time to focus on a critical cog in the semiconductor economy. Musk spoke to employees of Europe's ASML during the company's annual technology conference. ASML is the only company in the world that makes the machines needed for an advanced printing process in Chipmak. In addition to his other projects, Musk is currently working on a huge chip fabrication plant in Texas known as Tariffab. ASML's products will be critical to that effort. Earlier this week on X, Musk posted ASML should be treasured and supported. It is arguably the greatest company in Europe.
- [03:44]
Joe Kernan
For more on the SpaceX IPO, let's bring in somebody who loves rockets and airplanes and defense stocks, CNBC's own Morgan Brennan. We didn't have to beg you to come in here. I mean you were ready to go because I saw you about 10 minutes.
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Morgan Brennan
I'm ready for liftoff. Joe.
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Joe Kernan
That's, that's good. All right.
- [04:04]
Morgan Brennan
Yeah. Huge moment 10 years ago. I think a lot of folks on Wall street and elsewhere, we're not necessarily taking any of this very seriously and what a difference those years make. So I sat down exclusively with Space X President and CEO Gwynne shot well wide ranging interview from the company's headquarters in Starbase Texas. This was just ahead of the roadshow last week. The $75 billion that Space X is raising will go toward building out a vertically integrated full AI tech stack. It's going to stretch from earth to space. And for a company that rarely did M and A in its first two decades plus that really started to change last year. So first yet that $17 billion to acquire EchoStar Spectrum to boost Starlink's device to device offering. And then you had the absorption of Xi for $250 billion in February and recently that deal with a coating upstart Cursor that includes an option to buy post IPO for $60 billion in stock. So I asked shot well what Cursor enables for Space X. Cursor has their
- [05:06]
Gwynne Shotwell
own models, I think, and we can learn from them. They are learning, they're Looking at our models, we're looking at their models. Their data set was. There was. Their training data was incredibly. It was excellent. And so that' and we have compute. So basically it ended up being kind of another model company that we could collaborate with closely. And that's fundamentally how I would characterize it right now. We're going to collaborate closely. We think this makes a huge amount of sense, but we'll make final decisions in a few months.
- [05:39]
Morgan Brennan
In general, the approach to M and A, how should investors think about that, especially given that disclosure in the amended filing that the company, quote, may issue a significant amount of equity in connection with future transactions?
- [05:51]
Gwynne Shotwell
You know, we work really an M and A company. Space X wasn't an M and A company for decades. And so it's kind of a new, exciting. It's a new, exciting world for us. I do think M and A is in the future, especially when you look at the world, I think you'll see more of that.
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Morgan Brennan
Just generally, there's a lot of speculation that SpaceX could merge with its sister company, Tesla. This is just one example of some of the notes that are circulating right now. This is Dan Ives from wedbush. Continue to believe that Space X and Tesla will eventually merge 80% plus chance, in his view, into one company in 2027. And the groundwork is already in place for both operations to become one organization. Your response?
- [06:34]
Gwynne Shotwell
That might make Elon's life a little easier, actually. There's no question that there's synergies between Tesla and Space X and our futures. Definitely there's a convergence of kind of what we're all trying to accomplish in the future. But right now I'm focused on keeping the lights on here, keeping rockets in production, flying rockets, flying people, getting to the International Space Station, and critically providing broadband to folks that don't have access to that critical capability. So I'm really focused on that. I'm not focused on that part of the future.
- [07:09]
Morgan Brennan
All right, so not a yes, not a no. Tesla owns a stake in Space X or X AI. The two have worked together often over the years and they now have this Terraform megaproject together that they are partnering with intel for to make those advancements advanced chips build out the compute. Tesla Cyber Cab robotaxis have been installing Starlink minis since you need that uninterrupted connectivity to fully realize autonomous driving. And then when you go to Starbase, the Cybertrucks are everywhere. SpaceX accounted for. Now this, this estimate is according to Barron's, based on the prospectus up to 8% of Tesla's US Cybertruck sales last year. Governance guys also plays a huge role in all of this and we talked about that. So I will bring you some of that piece of the conversation from my exclusive sit down with Shotwell a little bit later. In the meantime, for folks that want to dive into all of it in its entirety, right now we have the full interview on CNBC.com and other coverage as well. Rolling out in real time.
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Joe Kernan
Morgan, it's a big day for Gwynne obviously and a lot of people involved with SpaceX. It was funny when, when we saw the list of, you know, billionaires that were going to be created and you know, in a trillionaire in this case. But it was kind of funny because we saw that Gwen was at 1 and 3/4 billion or something and we actually made the point we thought it would be more and that maybe she, you know, she can't go absolutely crazy. I mean she's still got to, you know, just watch, you know, I mean it's a lot. But did you talk about that at all? Great day for everyone involved.
- [08:45]
Morgan Brennan
Obviously a great day for everyone involved. And certainly one of the things we talked about why the decision to go public now and she, she was very plain spoken in saying this is about capital, but also that it is about giving more everyday Americans and to use the term that she used, friends, the opportunity to invest in Space X as it continues to grow and build out this future that ultimately, according to Elon Musk's longstanding and I would say very consistent vision of making humankind multiplanetary, that those are the two kind of key reasons that they're taking this company public now. But along the way, to your point, a lot of folks within the Space X workforce, which is 22,000 full time workers and counting right now, by the way, they're still hiring. We talk about taking jobs, they're hiring, they can't get enough workers. That many of those folks do own Space X stock. And so you've seen the reports leading up to this about how many millionaires and in the case of shot one others billionaires that are to be minted by all of this. The other thing of course from a stock specific standpoint to watch is going to be this tiered lockup structure. And while some folks are going to be able to start selling shares right away and others in tranches and over the course of many months, you know, senior leadership and this starts with Elon Musk, are going to be tied up for 366 days as well. But keep in mind with Musk specifically, he doesn't tend to sell stock in the companies that he is building. When we have seen that happen at times over the years, it's because of some bigger investment or projects like acquiring Twitter for and building out X AI a couple of years ago. So huge day for that workforce, including Shotwell and others. But I also think in many ways the start of something much bigger for a company that 24 years in the making is really just laying the groundwork for this massive future that they are laying out.
- [10:41]
Joe Kernan
Yeah, as big. As big as space itself. Which is unbound and unbound, Right, Exactly. All right, thank you, Morgan.
- [10:55]
Melissa Lee
Our next guest is one of Elon Musk backers, early backers in fact. David George, general partner at Andreessen Horowitz. He leads a 1A 16Zs growth investing team. David, great to have you with us. First invest in early 2021. So you saw the vision even back then. What, what do you think has changed in terms of the attitude towards space as a business, as an industry since then? What, what triggered the change?
- [11:20]
David George
Yeah, absolutely. Well, first, thanks for having me. It's great to be here. Exciting day. Yeah. When we first invested in Space X Starlink was in its very earliest moment. They had just gotten satellites into space. But at the moment we could see that it felt like all of the physics problems were solved in launching satellites to space and then providing the service down to space as a telco service. Today there are some parallels with where we are with AI data centers and the position they're in in terms of having kind of de risked all of the physics components of it. And now what we see is sort of execution questions remaining. So when we invested, we felt like, okay, this is classic Elon. Elon can sort of take things that seem impossible, solve them technically, and then execute the cost down so that he is the low cost provider. And that's sort of where we are with Starlink today.
- [12:11]
Melissa Lee
So what are your thoughts on this idea of a total addressable market prospectus? I mean, it almost seems tongue in cheek. I mean, I know it's real number and it's in there, but space is infinite. So can you wrap your head around 26 and a half trillion dollars?
- [12:26]
David George
Yeah, I can. Look, the way I think about Space X is this is the best entrepreneur of our generation in Elon and he's going after two of the biggest markets of all time and two of the most important markets in technology for our society. So space and AI, if you look at space alone. The launch business is an extraordinary business. They have demonstrated things that no one else can do. They can send a starship which is the size of a football field effectively up to space, land it back on earth with the chopsticks. No one else is close to being able to do that. In terms of the telco business, yes, the total addressable market of that is probably $2 trillion. And they have gotten to the point with their scale where they have a cost advantage going forward. So on the space side, yes, it's an enormous addressable market and they are in an excellent competitive position. On the AI side they've demonstrated a couple of different ways to win. So one of the things that we're super excited about is obviously Colossus. They are the only player that has gotten a 1 GW plus data center live in the US in the world. And that's an extraordinary technical achievement. Obviously there are great business results that come from that but technically they're executing very, very well.
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Melissa Lee
Andrew has a question.
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Andrew Ross Sorkin
Hey David, congratulations on the investment. I mean it's a remarkable, remarkable thing. My question is going to be how quickly you plan to sell. Would you sell? Given what your firm does, you typically don't hold public equities for extraordinary amounts of time. But how do you think the public should think about that?
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David George
Andrew, great to see you. You know, obviously you know we're, we're long term investors, we're investors from the private markets predominantly. We're excited about the long term. You know, obviously we're subject to a lockup. So I'm not going to, you know, talk much about exiting but we're very bullish on the long term. I think, you know, there are many ways to win for Space X from here. The way I look at it is they have extraordinary competitive positions in space and in AI. And then there are many sort of elements of optionality which I think are super exciting. So obviously we talked about Colossus and the data center opportunity. We could talk about AI directly, we could talk about AI coding and then you know, obviously you know, a big swing is going to be Tariff Fab where they have probably the only opportunity to create a new chip company in the technology market given they have a captive customer base with, with both, you know, SpaceX and Tesla. So, so we're very excited about their setup competitively in the long term. Setup for them.
- [14:57]
Andrew Ross Sorkin
I don't know if I'm getting ahead of ourselves but would you be an advocate of a transaction that would involve SpaceX using its share price to buy Tesla.
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David George
You know, look, there are many different paths that Space X could take. I would say this about historical transactions and capital allocation. SpaceX has been an excellent steward of capital and great with shareholders. They have done acquisitions in the past that make business sense and strategic sense. So obviously, you know, we backed, we backed Elon in his purchase of Twitter. We backed Elon, you know, in the first institutional round of X AI. And there's, you know, those have come together with Space X because they make business sense and strategic sense. So over time, you know, it's impossible to say what's going to happen, but if there were something that made business sense, you know, we'd be, we'd be supportive to shareholders.
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Melissa Lee
We have seen a pipeline of, of space companies. Some have already gone public pre Space X and so they're rushing out there and I'm wondering if this has sort of spurred sort of renewed interest in that in terms of investing early in space industry companies.
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David George
Yeah, it has. Look, we've been very active investors through our American dynamism practice in space. I think it's an enormous opportunity. If you want to be a leading space company, you need to have access to get things to space. And that's part of what gets me so excited about SpaceX is they are the low cost, leading provider of launch and getting things to space. My expectation is, you know, over the, over the coming years that cost of getting things to space will probably be reduced by a factor of 10x again. And the exciting element of that, which we've seen in all kinds of technology markets, is that will lead to massive growth of sending things up to space, both first party and third party.
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Melissa Lee
So it's like the railroad.
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David George
Yes, exactly.
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Melissa Lee
Back when the railroad started and look,
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David George
the railroad enabled lots of different businesses to be built on top of it. And similarly Space X will build a lot of those businesses themselves, like orbital data centers. But that will also enable third parties to build businesses on their own as well.
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Melissa Lee
But how should we think about the liquidity going to SpaceX and to space economy companies and, and what we've seen in, in Bitcoin and other areas of the public markets where we've seen liquidity get pulled out. Do you see that as sort of like a competition for hype capital, so to speak?
- [17:14]
David George
I'm not sure about that. I think it's great for companies like Space X to be public. I'm most excited about the opportunity for broadening the shareholder base. I think this is probably going to be the largest retail offering in history. You know, the retail component of this alone will be among the biggest IPOs ever. And I think that's a great thing.
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Melissa Lee
David, great to speak with you. Thank you.
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Ben Narrison
Cheese will be next.
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Cameron Costa
Coming up on Squawk Pod, the biggest IPO ever. But we may have seen this movie before. At least venture capitalist Ben Narrison thinks so.
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Ben Narrison
This IPO basically rhymes with Facebook. You know, Facebook had a visionary leader that everybody wanted to bank who insisted on a price. That offering did not do well for quite a while.
- [18:00]
Cameron Costa
It did come back the long and short term view right after this.
- [18:11]
Venture Global Representative
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- [18:40]
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- [19:07]
Keith Lansford
brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions and key results and statistics that may impact your trading. Download the latest episode and subscribe@schwab.com Market Update podcast or find Schwab Market Update Wherever you get your podcasts.
- [19:38]
Cameron Costa
SpaceX isn't just going public, it's testing investor appetite for the next generation of AI and tech giants. The market's reaction today could have a direct impact on how quickly companies like Anthropic and OpenAI move toward their own market debuts. Andrew Ross Sorkin spoke with Ben Narrison, Tenacity Venture Capital founder, on this very issue.
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Andrew Ross Sorkin
How important is is how this all goes today in terms of what comes next.
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Ben Narrison
I think it's absolutely critical. If SpaceX doesn't fly, you're going to see a huge stall for everything else and it can put a true chill on the market if it pops. Everybody is just popping champagne and running to push their stuff out. We'll see a tremendous amount of IPOs. Not just open air anthropic, but a lot of Other great companies do you
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Andrew Ross Sorkin
see a way in the short term for the company for the stock not to pop? And the reason I said is, but the reason I ask is if you have these index funds which in the next five days are going to be buying, rotating out of whatever they have to to get cash to actually buy this, walk through the permutations of how you see that.
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Ben Narrison
So those the two best reasons you won't see downward pressure are one, the early listing in the major indexes and people's need to place those in their, you know, ETFs etc. The other is the sort of fanboy fan girl effect. And that includes people that I think are phenomenally intelligent like Ron Baron. And obviously Blackstone announced that they're putting a $5 billion check in. But there is so much this, this IPO basically rhymes with Facebook's. You know, Facebook had a visionary leader that everybody wanted to bank who insisted on a price. At that point it was $100 billion. Elon's done the same thing. They did it without price discovery. The opening was delayed pretty significantly and I suspect expect this one will be as well as market makers tried to match that offering did not do well for quite a while. It did come back. Look, I am a long term buyer of SpaceX. I think it's me a phenomenal company. But there are so many systematic issues right now that I think are going to put pressure on this stock. I have no idea how many people that wanted allocations want them for a flip. You know every banker tells you they're going to get you long term holders. Our bankers told us the same thing. But then people are out there selling from from the opening bell. So I think there's a lot that reminds me of what happened before and I think there's a pretty good chance, I'd say at best it's a coin flip. It's not what the polymarkers the world are saying but I think it's a coin flip whether this ends up up or down.
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Andrew Ross Sorkin
Well, you just said you'd want to be a long term holder. Does that mean that you plan to wait because you think there's going to be another opportunity to get it at a better price?
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Ben Narrison
Absolutely. I mean look, even if it holds today or pops the lockup expiry, I know they have a staggered lockup and lots of different pieces to that, but in six months when everybody gets released, I don't see that being a great day. So that could be a great buying opportunity. Look, the people that are going to make really good money. Here are the long term holders, the Buffett style mindsets, the Ron barons of the world, where they're going to buy and they're going to hold and they're not going to worry about the vicissitudes of the market. But the problem is, I have no idea how the Robinhood Bros. Of the world are going to handle this if it doesn't go well, if it trades down, down, it's going to turn into a pretty aggressive downward spiral, I would assume.
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Andrew Ross Sorkin
And you think that's something that takes now, not just IPOs more broadly, meaning the anthropics and IP and open eyes, but, but the broader market?
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Ben Narrison
Well, I think it puts a pause on the IPOs that people are so excited about. You know, we've talked about this before. Bankers are motivated by greed and fear. Now here, greed equaled, as we just heard, half a billion dollars of fees. Not too shabby. The fear is that if your clients lose money too many times, they don't buy your offerings anymore. And so if clients take a bath on this one, I'm not sure how quickly bankers are going to be willing to push out the next one. Whether the broader market takes a hit, I don't know. I mean, people quote unquote rotated out of tech to be able to have money to buy into SpaceX or that was the theory. So maybe they move right back into it. There's no better category to invest in. I mean, it's not like you're going to say, oh, what's as good as tech? I don't know, oil and gas, no tax. Where the future is and where all the great growth is, these companies are phenomenal.
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Andrew Ross Sorkin
When you think about some of the incentives, alignments and misalignments in terms of how IPOs like this go today you look at the retail piece of it, the 20% instead of 30%. You had a lot of, we talked about BlackRock, you know, taking a big piece to this. I imagine, you know, when you take a big piece on one end, you're also hoping to get something on the other end. You added JPM and more and Stanley and Goldman Sachs. How do you, how should we try to understand sort of the behind the scenes of all this?
- [24:13]
Ben Narrison
Well, another thing that gives me a lot of pause is the significant retail exposure. Not just that it was made available to retail. I like that. I think it is very fair to give people the opportunity to participate in IPOs. In the old days, people would literally open multiple accounts with multiple. They would go to Goldman or whichever firm they could go to and they'd open like 12 accounts, they'd ask all of them for an allocation IPO, because IPO would pop and they'd sell immediately. But I do like the idea of giving retailers, retail buyers, the opportunity to buy in. What I find disheartening was when one of the major banks announced that they would drop the minimum threshold of assets from half a million dollars down to $2,000. So all of a sudden you're basically saying, you know, as long as you've got two sticks you can rub together long enough to build a fire and then sell hot dogs for a week, you can be in the space ASX ipo. That to me is, is a pretty dangerous thing because I'm not convinced those are long term holders. I think that it might be more motivated by what they perceive as a quick hit. And Tesla's had a great run for a long time. So you would assumely see people from Tesla coming into this offering. But the retail component of this is something I think adds a level of variability that is pretty hard to predict. And you've seen that in the past, right? You've seen stocks, you've seen the meme stocks move like crazy off of pure retail.
- [25:25]
Andrew Ross Sorkin
Where do you land though then on there's another retail element of it, but the NASDAQ and its decision to include this in the exchange or in their index immediately, I imagine that means that anthropic and an open air would also have that opportunity.
- [25:40]
Ben Narrison
Well, I mean, look, I think that one's pretty transparent. They needed to win the deal away from the New York Stock Exchange. I've done an IPO on the nasdaq, I've done an IP on the New York Stock Exchange. It's a lot more pompous circumstance in the stock exchange if you were just going for the building and the wonderful flair of the first day. It's a, it's a fascinating thing to do. But when they put you on the short, you know, on the NASDAQ 100, that helps. So that to me was just a pay to play, whether the others will get it or not. It certainly breaks precedent and therefore makes it easier for the next person to negotiate for it. Same with the banking fees, right? These banking fees are a much more smaller percentage they usually get. But on an absolute amount of money, it's still stunningly huge. So look, once you do something for one person, it always becomes easier for the second person to insist pay to play that.
- [26:26]
Andrew Ross Sorkin
That's typically not a great phrase. Are you surprised we have not had a bigger conversation in terms of, from a regulatory perspective about this new, new approach?
- [26:35]
Ben Narrison
I mean, I don't know why it would percolate up to that level. When I say pay to put play, it's negotiation. You're trying to win the deal. I mean, you know, that was one of the costs of getting this deal done. That's what they paid to get the deal done. That's what they paid to be the player that became the exchange that this trades on. And I don't see anything untoward about that. This is not a, you know, whatever. Remember in Trump 1, it was, there was no whatever. It was tit for tat. I, it's not, these are not backroom dealings.
- [27:10]
Andrew Ross Sorkin
I mean, it's all, you know, I think, Ben, I think the question, the question is there's, there's, there's two constituencies in this case. There's the shareholders of the NASDAQ on one end, the shareholders nasdaq, not the index on one end, that benefit by having this IPO on the exchange. And then there are the implications for price discovery and what ultimately happens to the investor and the investor class on the other, which has to do with the index. And serving both masters may not be the same thing.
- [27:41]
Ben Narrison
Oh, they're totally different. So the price discovery, the absence of price discovery is one of the number one reasons I'm fearful this, this price doesn't hold, at least not for the near term. It probably comes back when it gets added to the index, but the shareholders of the NASDAQ should be super happy. You know, when you take a company public, you pay a per share fee to the exchange you trade on. So this is an enormous revenue generator for nasdaq. It's an enormous point of pride. This is going to be quite useful. So if I'm a shareholder in nasdaq, I'm very happy. But that's a totally separate thing from being a shareholder in SpaceX and what happens from it.
- [28:18]
Andrew Ross Sorkin
Fair enough, Ben. We got to leave it there. It's the big morning, guys. The big morning.
- [28:25]
Cameron Costa
Still to come on squawk pod, new heights for rockets and for Elon Musk.
- [28:31]
Robert Frank
By the end of today, Elon Musk will likely become the world's first trillionaire.
- [28:36]
Cameron Costa
That's with a T. And Elon Musk himself ahead of the company's first trade.
- [28:41]
Elon Musk
We want to be able to take you there, not just a few astronauts. I mean, you.
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Venture Global Representative
At Venture Global. We think about what can be done, not what's usually done through innovation. Venture Global is not only building some of the largest energy facilities in the world right here in the United States, but delivering American energy at a fraction of the cost in a fraction of the time. So while others are busy talking, we're busy building. That's venture capital.
- [29:16]
SpaceX Launch Announcer
Global.
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Venture Global Representative
That's unstoppable energy.
- [29:22]
Discover Card Voice
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- [29:47]
David George
Hey, Fidelity, how can I remember to invest every month?
- [29:52]
Fidelity App Voice
With the Fidelity app, you can choose a schedule and set up recurring investments in stocks and ETFs.
- [29:59]
Joe Kernan
Oh, that sounds easier than I thought.
- [30:01]
Fidelity App Voice
You got this?
- [30:02]
David George
Yeah, I do.
- [30:04]
Joe Kernan
Now, where did I put my keys?
- [30:06]
Fidelity App Voice
You will find them where you left them.
- [30:10]
Ben Narrison
Investing involves risk, including risk of loss. Fidelity Brokerage Services LLC Member NYSE SIPC.
- [30:22]
Cameron Costa
Welcome back to Squawk Pod from CNBC Today with Joe Kernan, Andrew Ross Sorkin, and Melissa Lee. The other story that got us squawking today, the money about to be made in the SpaceX IPO.
- [30:35]
Joe Kernan
It is SpaceX day at the NASDAQ. Elon Musk rocket company raising. Raising $75 billion in the biggest IPO on record. The company selling more than 555 million shares at $135 each. That gives Space X a valuation of nearly $1.8 trillion. That about where. What's Elon worth? What's the number?
- [31:00]
Melissa Lee
Don't give it away.
- [31:01]
Joe Kernan
Okay. I think it's Robert Frank's here. I think that's a similar number. September, isn't it? That's the seventh highest valuation among U.S. companies and ahead of Tesla. CNBC learning the IPO is about five times oversubscribed. A person familiar with the matter said retail investors were slated to get a level of shares in the low 20% range below the the 30% that space x had been targeting.
- [31:29]
Melissa Lee
If you just waited like 10 seconds, I think we would get the number.
- [31:32]
Robert Frank
Joe is always one step ahead of me on everything. So once again, we already knew that
- [31:36]
Joe Kernan
that was with the math that, that, that number's out there, isn't it?
- [31:40]
Robert Frank
It's not quite.
- [31:41]
Ben Narrison
Not quite.
- [31:41]
Robert Frank
We'll tell you what he needs to get there.
- [31:43]
Melissa Lee
Yeah. So we want to know what it will take for Elon Musk to officially become the world's first billionaire. Robert Frank, 33.
- [31:52]
Joe Kernan
If it was a 30% jump from the IPO price, does that do it? Robert?
- [31:56]
Robert Frank
Well, we're going to tell you.
- [31:57]
David George
Is it a 20%, is it a 15%?
- [31:59]
Joe Kernan
Is it bigger than a bread? So are those new glasses?
- [32:03]
Robert Frank
These are the same glasses I've been wearing. I go, I go back and forth. Thank you. By the end of today, Elon Musk will likely become the world's first trillionaire. That's with a T. It all depends on SpaceX shares staying above $140 a share, probably. So here's how the math breaks down as Tesla stake at yesterday's close is worth around $260 billion. That include includes those options worth about $120 billion that were tied up in court for a while. He got those back on space X. The S1 filing lists him with 6.4 billion shares, but that includes about 1.3 billion shares that he votes but won't actually vest until he colonizes Mars or reaches a 1 trillion terawatts of compute. Since they're not yet vested, I'm not counting those as owned shares of shares or part of his net worth. So at an IPO price of $130 $35 a share, his Space X stake would be worth $690 billion. That brings Space X and Tesla together to $950 billion. Added Neuralink, boring. Other assets probably worth 10 to 20. That brings him right now to a total of about $970 billion. Bottom line. So he's just under that trillion dollar mark if Tesla stays flat today and it's actually up pre market. So there are two variables here. There's the Tesla stake and the SpaceX stake. SpaceX state, the shares need to stay above $140 a share for Musk to be the first person in the world to receive the fourth comma in his net worth. Now for more on the millionaires and billionaires being Created by the SpaceX IPO and how they're investing, investing and spending their newfound wealth. And sign up for the Inside wealth newsletter@cbc.com inside wealth so that's the variable because if SpaceX goes up a little bit today, he's already there. And if, sorry, if Tesla goes up today, if SpaceX stays at 135, then he'll probably. But most likely by the end of today he will reach that trillionaire mark.
- [34:08]
Joe Kernan
Yeah, on paper, which is, you know, I just like to think of it as a thousand billion.
- [34:13]
Melissa Lee
A thousand, you can't even wrap your head around that number.
- [34:15]
Joe Kernan
No, we can't wrap it around.
- [34:18]
Melissa Lee
You see the infographic the Wall Street Journal had today about how many pennies it takes to get from Earth to Mars? Two round trips of pennies stacked up.
- [34:28]
Robert Frank
It's staggering. And you look at the distance now between Elon Musk and all the other richest people. We've just never had, you know, wealth concentration even at the, even among billionaires, like, like we have today. So this is going to cause all sorts of debates about, you know, the Elizabeth Warren's of the world and trillionaires becomes another target. But it is amazing for him to have two companies both with market caps of over $1 trillion and with him now valued at.
- [34:57]
Joe Kernan
It's not a zero sum game, but we are seeing a lot of other assets. I mean it's not. But then you do see a lot of other assets being liquidated to get in this space. So there's not. I would argue he created it. Right. And he didn't steal it from somebody else.
- [35:13]
Robert Frank
And there are thousands and thousands of millionaires that are being created by this IPO that he carried. The people joined this company in the early 2000s. Nobody knew what it was. They thought they were crazy to join. They took below market salaries in exchange for stock that. Who knew, they had no idea, idea the stock would ever be worth where it is. So he has carried so many people along with him and created. Well, not to mention, if you're a real estate broker in Hawthorne, California, right now you're winning the lottery. I mean, the amount of real estate, the amount of cars, this I would imagine.
- [35:44]
Joe Kernan
That's Right, right. Texas and you know, got other issues. I mean, when I see a Tesla that says I bought this before Elon went crazy, I mean, I feel like running them off the road.
- [35:53]
David George
I do.
- [35:53]
Joe Kernan
I'm sorry, I won't, I won't. It's just a brief thought, a passing thought. But you know, once he went to Doge, it's like, oh my God, he's, you know, he's aligned with the bad orange.
- [36:03]
Robert Frank
Wonder if he'll see rockets like with those kinds of.
- [36:07]
Andrew Ross Sorkin
I like this rocket before.
- [36:10]
Joe Kernan
Elon's always been crazy.
- [36:11]
Melissa Lee
Okay, well, that's part of his genius.
- [36:13]
Joe Kernan
No kidding.
- [36:14]
Melissa Lee
Who can think about colonizing Mars?
- [36:16]
Joe Kernan
I know. And really when you said you're not, you're not putting it into your caucus, it's like, why not?
- [36:22]
Robert Frank
Not yet. Because they're not vested.
- [36:24]
Joe Kernan
No.
- [36:24]
Robert Frank
When colonizes Mars, that seems far fetched.
- [36:29]
Joe Kernan
But I don't put anything, you never know with him, you know, Neuralink. I mean the stuff that's coming out
- [36:35]
Robert Frank
of there, it's just, yeah, that's a fifteen billion dollar company by itself.
- [36:38]
Joe Kernan
What the technology. And they won't even thought, even try to do that.
- [36:42]
Andrew Ross Sorkin
A lot of these things, it's remarkable.
- [36:44]
Joe Kernan
It is, it's great. I'm glad we have it.
- [36:47]
Robert Frank
Wealth reporters are very glad we have.
- [36:54]
Cameron Costa
While we were at the NASDAQ this morning with SpaceX President Gwynne Shotwell, Elon Musk was with many other SpaceX employees and their investors at Starbase in Texas. He addressed everyone just before the opening bell.
- [37:09]
Elon Musk
Thank you Gwen. Gwen Shotwell has been an incredible partner and was one of the first people to join the company. And so. Thank you Gwen. Oh, she's in New York of course.
- [37:21]
Ben Narrison
Where is she?
- [37:26]
Elon Musk
And yeah, it is certainly hard to believe that little company that started in a warehouse in El Segundo is not going public for the with the largest IPO ever. And let me tell you, if people had told me this was going to happen, I was like, man, you must be smoking some really good crack because I think this company's going to fail. I mean I gave, I gave SpaceX less than a 10% chance of succeeding at all, to be clear. In fact I told people this, I said look, we're probably going to fail, but we should give it a try because if we don't, if there's not a new company that enters space, we will never be a truly space faring civilization. While the other aerospace companies, they built good rockets and everything, they were simply not pursuing the technology that's necessary to make life multi planetary, To make Star Trek, to make the exciting science fiction futures that we've read about real. And that's what SpaceX is all about, is to take the fiction out of science fiction and create an exciting, inspiring future for everyone. We want to be able to take anyone who wants to go to the moon, anyone who wants to go to Mars or anywhere in the solar system and maybe beyond the solar system at some point we want to be able to take you there, not just a few astronauts, I mean you literally you, if you watch, whoever you are watching this, SpaceX wants to be able to take you to the moon, take you to Mars and ultimately beyond. And I'm confident at this point that with the incredible team that we have here at SpaceX that we will do that for you. I always think about this. There are always problems on Earth, there are always problems on Earth, there are always things that we wish to be better, that we want to solve here on Earth, and we should solve them. But there also have to be things that get you excited about the future, that make you glad to wake up in the morning because you can't wait to see what happens next. And that's the future that SpaceX wants to bring to you.
- [40:53]
Cameron Costa
That's Squawkpod for today and for the week. Thank you for tuning in to our coverage of SpaceX's IPO. Remember to head to CNBC.com to watch Morgan Brennan's full interview with SpaceX President Gwynne Shotwell. Squawk Box is hosted by Joe Kernan, Becky Quick and Andrew Ross Sorkin. You can tune in to catch them live weekday mornings on cnbc Starting at 6 Eastern. And you can always get the best bits of that TV show, plus a little extra right here on Squawkpod. Wherever you get your podcasts, please give us a follow, give us a review, tell us what you think and come back on Monday. Have a great weekend.
- [41:34]
Ben Narrison
We are clear.
- [41:36]
Robert Frank
Thanks guys.
- [41:41]
SpaceX Launch Announcer
Foreign
- [41:44]
Keith Lansford
this episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview, delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and subscribe@schwab.com MarketUpdatePodcast or find Schwab Market Update. Wherever you get your podcasts.