US IPO History: Soaring on Day One, Plunging Within a Year. Can SpaceX Break the Curse?

As the largest IPO in history, $Space Exploration Technologies Corp(SPCX)$   plans to raise $75 billion at a staggering valuation of $1.77 trillion. Fueled by three top-tier narratives—low-Earth orbit satellites, rocket launch and AI—the offering has seen oversubscription exceed 4x across all platforms, creating peak market sentiment ahead of the listing. 

Considering the historical performance of mega-cap tech IPOs from the past decade, investor tiers are expected to be highly fragmented. With long-term strategic capital, swing-trade hedge funds, and retail sentiment traders all participating, the stock price could experience massive volatility. In the short term, sentiment premiums will be extremely high; in the medium term, there will be pressure to deliver on earnings; and in the long term, its value will hinge entirely on the commercialization of Starship and other businesses.

1. SpaceX IPO Fundamentals

SpaceX is scheduled to debut on the Nasdaq on June 12, 2026, with an IPO price of $135 per share. All amount raised will be dedicated to Starship R&D, Starlink expansion, AI infrastructure development, and general corporate purposes. In terms of corporate governance, equity is highly concentrated: Elon Musk holds approximately 42% of the equity but commands over 80% of the voting power, granting him absolute decision-making control. Valuation-wise, the company is priced at a massive 94x forward Price-to-Sales (P/S) based on projected 2025 revenues.

2. Benchmarking Mega-Cap Tech IPOs: Historical Capital Flow Patterns

Major tech IPOs in recent years to identify recurring trading patterns. It shows a fixed price trajectory for mega-cap growth IPOs. Historically, these stocks generally close higher on their first trading day, buoyed by cornerstone investors providing a floor and incremental capital rushing in. Scarcity in tech sectors often leads to significant opening-day gains. However, a common flaw is equally consistent: ultra-high valuations at launch price in 2–3 years of future growth expectations. Within six months to a year, fundamentals often fail to justify the valuation. Combined with lock-up expirations for early shareholders and momentum capital exiting, the stock frequently experiences a pullback.

Breaking down investor behavior:

Sovereign Wealth Funds typically act as cornerstone investors, locking up their positions and rarely trading post-IPO, serving as ballast for the stock. Silicon Valley tech giants enter primarily for strategic synergy, holding for several years to align with industry cycles rather than taking quick profits.

Top Growth & AI Hedge Funds mostly focus on swing trading. They actively push the price up on day one but quickly dump shares if earnings disappoint, acting as the primary drivers of short-term volatility.

Passive Index Funds act as passive buyers, continuously flowing in once the stock is added to indices like the Nasdaq-100 or S&P 500, providing the most stable price support.

Retail & High-Net-Worth Investors trade purely on sentiment. They pile in on day one and are typically the group most likely to get trapped at the highs.

This exact capital flow logic is expected to play out perfectly in SpaceX's upcoming IPO.

3. SpaceX's Underlying Quality

Compared to past IPOs, the line between SpaceX's strengths and risks is clear. On the positive side, unlike pure cash-burning ventures, Starlink has already achieved scalable revenue, with 2025 revenue growth of 49.8%. Its commercial launch business maintains a dominant global market share, creating a near-monopoly barrier in the sector. Coupled with the current hype around its AI business, its growth potential far exceeds previous tech IPOs. Conversely, risks remain prominent: the company consistently reports operating net losses, there are risks of Starship development missing market expectations, and Elon Musk's personal actions continue to introduce unpredictable negative catalysts.

In short, SpaceX is an epic IPO that combines aerospace monopoly, AI computing power, elite capital backing, and massive IP appeal. Investor tiers are clearly defined: long-term capital provides a bottom floor, swing capital drives short-term noise, and retail capital gambles on sentiment. Based on historical mega-cap IPO trends, early-stage sentiment premiums are inevitable, but only fundamentals will dictate long-term heights. Investors must respect the volatility of high valuations and pace their entries carefully.

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