From the investor meetings to how shares are doled out, the billionaire is navigating his own path.
Elon Musk is cooking up a memorable stock-market debut for SpaceX, and not just because it is expected to be the biggest one ever.
The 54-year-old billionaire is writing his own playbook for the blockbuster initial public offering, which is being timed for mid-June before his birthday. While most executives are expected to travel to pitch their companies, Musk wants to have investors come to SpaceX, where they can visit manufacturing facilities and possibly witness rocket launches, according to people familiar with the matter.
Musk and his team are betting fund managers and analysts will leave wanting to put in big orders for the IPO, which is expected to raise between $40 billion and $80 billion, according to people familiar with the deal.
The rocket-and-satellite company is expected to file confidentially with regulators for its IPO in coming days, people familiar with the matter said. A public filing typically occurs a couple of months after the initial submission, depending on how many questions regulators have.
The investor visits to company sites are just one of the options SpaceX is weighing, and are in line with Musk’s record for flouting norms in the corporate world. Also under consideration: unusual lockup times that limit share sales by early investors, preferential treatment for investors in his other companies and allocating an outsize portion of shares to individual investors, people familiar with the matter said.
The company is considering hosting events at SpaceX locations including its sprawling complex near the Los Angeles airport and its rocket launch site in Florida’s Cape Canaveral area, people familiar with the matter said. SpaceX executives might also still visit some investors, the people said.
SpaceX Falcon 9 rocket launching from Kennedy Space Center.
The ideas come from Musk as well as his team members, including bankers like Morgan Stanley’s Michael Grimes, some of the people said. It is unclear which of the plans will stick.
Musk is known for his unconventional style. He has been known to sleep at the offices of his companies and engage in “rage firings” and waived due diligence before inking his deal to buy Twitter. He makes corporate announcements on the social-media platform now known as X, including one about possibly taking Tesla private that got him in trouble with regulators.
A nod to the fans
In the world of Musk, loyalty is rewarded.
Expect this to remain the case when SpaceX starts doling out shares in its IPO, people close to the deal say.
One of the ideas under consideration is to give preferential treatment to those who have invested in other Musk companies. They include Tesla shareholders, as well as investors who helped back the billionaire’s 2022 effort to take over Twitter.
Musk has teased this idea before. At a Tesla shareholder meeting in November, he said he wanted to figure out a way for Tesla shareholders to participate or invest in SpaceX. The move would be a nod to the retail investors who have helped power shares of the electric-vehicle maker and are often fans of Musk.
SpaceX's production facility and office building at its headquarters in Starbase, Texas, with a parking lot full of vehicles in the foreground.
When Tesla shareholders voted on a pay package of up to $1 trillion for Musk, the biggest opponents were institutional investors. But Musk cited support from individual investors.
“So far, roughly 90% of retail shareholders who have voted have voted in favor of both resolutions,” he said in a June 2024 post.
Like Tesla, SpaceX has a big fan base that has helped the company. In 2022, SpaceX urged subscribers to Starlink, its satellite internet business, to get involved in one of its regulatory battles by sending comments to the Federal Communications Commission.
For the SpaceX IPO, Musk has said he wants to deliver a third, or even more, of shares sold in the offering to individual investors, some of the people said. In typical IPOs, individual investors tend to receive only around 10% of the shares offered.
A blockbuster rollout
The sheer size of SpaceX’s offering looms for bankers involved in the deal.
The company is still debating how much to raise in the offering and at what valuation, and that won’t be decided until right before the roadshow pitch to investors kicks off.
Raising any number in the $40 billion and $80 billion range would eclipse the nearly $30 billion raised by the Saudi Arabian Oil Company, commonly known as Aramco, in its 2019 IPO.
SpaceX is considering asking some large early shareholders to agree to a “lockup” for longer than the traditional six months. Lockup agreements prevent early investors and employees from selling their shares for a set period after a company goes public. Companies and their bankers worry early selling by these shareholders could pressure the stock price.
Bankers and SpaceX executives are considering eliminating the traditional lockup for other shareholders, which means they could sell their stakes right away. Other companies have also veered from the traditional lock up periods.
SpaceX is hoping to secure an early spot in large stock indexes such as the Nasdaq-100, an unusual move that would bring a flood of new buyers to its shares.
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