SpaceX is reportedly preparing for a stock market listing that could value the private rocket firm at more than $250 billion. For Elon Musk, this may be his most audacious bet yet. For UK investors, it is a signal to watch the skies and the bottom line.
Let me be clear: this is not a normal initial public offering. SpaceX is no ordinary company. It has revolutionised space travel, slashed launch costs, and built a satellite internet empire with Starlink. But investors should not confuse technological marvel with market discipline. The prospect of a SpaceX float comes at a time when global markets are jittery, gilt yields are volatile, and capital is flighty.
The City of London has long admired Musk’s showmanship. But a listing of this magnitude raises serious questions. First, valuation. At $250 billion, SpaceX would be worth more than Boeing, Lockheed Martin, and Northrop Grumman combined. That is a heroic assumption for a company that, by most accounts, is still loss-making. Its revenue streams are concentrated in government contracts and a Starlink subscriber base that remains unproven in the long term.
Second, governance. Musk’s approach to corporate structure is famously unconventional. He has talked about taking Tesla private, fought with regulators, and borrowed heavily against his own shares. A public listing would expose SpaceX to the rigours of quarterly reporting and shareholder scrutiny. Does anyone believe Musk will enjoy that?
Third, the macroeconomic backdrop. Inflation is stubborn, interest rates are high, and investors are fleeing risk assets for safe havens. A splashy space stock is precisely the kind of high-beta gamble that tends to get hammered in a downturn. UK pension funds, which are already nursing losses from gilt market turbulence, should think twice before allocating capital to a company that burns rocket fuel faster than it generates cash.
Of course, there is a bull case. SpaceX has a near-monopoly on commercial launches. Starlink is a potential cash cow if it can scale. And Musk has defied the doubters before. But the bottom line is this: the margin for error is razor-thin. If the listing proceeds, UK investors must demand transparency on Starlink’s unit economics, the trajectory of government subsidies, and Musk’s own financial exposure.
In summary, a SpaceX listing could be the most exciting IPO since Facebook. But remember: Facebook took years to justify its valuation. And the market was not fighting a war, a pandemic, or a central bank that prints money. Caveat emptor, as they say in the Square Mile.
