As Elon Musk’s SpaceX enjoys rapid growth, the private space company could potentially kick off an IPO process as soon as next year or 2026, says money manager Vijay Marolia.
Marolia is the chief investment officer of Regal Point Capital, an alternative-investment firm focused on private equity and hedge funds. Regal Point owns SpaceX shares via the Baron’s Focused Growth Fund BFGFX.
SpaceX has pioneered reusable rocket technology in an attempt to lower costs and revolutionize the space industry, successfully achieving an impressive cadence for its launches. The company is also set to play a key role in future moon and Mars missions. Additionally, IPO chatter has swirled around the company.
But Marolia thinks that SpaceX is unlikely to make an IPO decision until after this year’s election. “I would say that 2025 is the bet” for an IPO decision, he said. “That’s when we know who is going to run the country for the next four years. … I think that if we know who is going to be in the White House, then that spreadsheet is ready to send.”
IPO spinoff talk has also recently spun around Starlink, the SpaceX-owned satellite-internet constellation. However, SpaceX CEO Musk apparently nixed the possibility that the private space company will spin off Starlink this year.
“If there’s a Starlink spinoff, it may be post-IPO,” Marolia said. “If I was going to IPO Starlink from SpaceX, I would do that when we’re closer to the Mars mission.”
Last year, Musk said that SpaceX could land an uncrewed spacecraft on Mars by the end of 2027. “I think it’s sort of feasible within the next four years to do an uncrewed test landing there,” he told the International Astronomical Congress in Baku, Azerbaijan, in October.
Marolia also said he thinks that SpaceX’s Starshield, a secured satellite network designed for governments, could potentially be a candidate for IPO or private spinoff, noting Starshield’s vulnerability to geopolitical and regulatory risk. But he is wary of speculating about the likely outcome. “Your guess is as good as mine at this point,” he said. “It’s so early; it’s too early to tell.”
The Wall Street Journal reported last year that SpaceX had targeted a $150 billion valuation through the sale of new shares.
Earlier this week, SpaceX kicked off 2024 by sending its first Starlink direct-to-cell satellites into orbit. The company launched 21 Starlink satellites atop a Falcon 9 rocket from Vandenberg Space Force Base. Six of the satellites provide direct-to-cell services, designed to provide seamless access to text, voice and data for LTE phones across the globe. SpaceX describes Starlink direct-to-cell satellites as “a cellphone tower in space” designed to eliminate dead zones.
The launch was the first of a busy year for SpaceX, which capped 2023 with the launch of 23 Starlink satellites atop a Falcon 9 rocket from Cape Canaveral Space Force Station in Florida on Dec. 29. The mission was the company’s 96th Falcon launch of the year, according to SpaceX.
SpaceX also marked a milestone for its reusable rocket technology in the early hours of Dec. 23, when the company launched 23 Starlink satellites into low earth orbit from Cape Canaveral. Shortly after launch, the rocket’s first-stage booster landed on a droneship floating in the Atlantic Ocean, marking the 19th launch and landing of the booster, a first for the company.
This year is set to be an even busier one for SpaceX, which plans to make 12 launches a month in 2024.
Set against this backdrop, the company’s operations remains firmly in the spotlight. The National Labor Relations Board issued a complaint against SpaceX earlier this week, alleging that the company had unlawfully fired eight employees who drafted and distributed an open letter detailing workplace concerns. MarketWatch