Elon Musk’s SpaceX is the first private company to send astronauts into orbit. It’s a model for Chinese Space companies that may beat it to Mars. Amid a sexual misconduct scandal, Elon Musk shows a nearly unlimited ability to raise more funds for the companies he’s involved with.
Aerospace firm SpaceX is looking to raise $1.7 billion in fresh funding just a few months after telling SpaceX employees the company could be at risk for bankruptcy. While he is a demanding CEO, SpaceX is well positioned now in 2022.
The space venture is looking to bring in up to $1.725 billion in new capital, at a price of $70 per share, according to a company-wide email on Friday. That would value the 20-year-old firm -- the first private company to send astronauts into orbit, among many other firsts -- at $127 billion. While that might not be realistic number given its clients, it does show how important Space-Tech is going to get.
SpaceX’s valuation has soared in the last few years as it raised billions to fund work on two capital-intensive projects: Starship and Starlink. It’s also shown some evidence of being able to do what it set out to do, build a company on re-usable rockets.
The sex scandal and Elon’s $44 billion offer to buy Twitter is a serious distraction for the company. SpaceX is also conducting a secondary sale to company insiders and existing shareholders for up to $750 million in common stock.
The funding round that’s in the works would give SpaceX the mantle of being the highest valued US startup on record, according to data from CBInsights. Although in many ways you could easily argue Stripe, ByteDance or even Ant Group are more important startups that have yet to go public.
SpaceX paid $250,000 in 2018 to a contract worker flight attendant so that she wouldn't sue its billionaire chief Elon Musk over sexual misconduct, in a nearly unbelievable story. Men typically do abuse their financial power and Elon’s recent media attention for threesomes with Johnny Depp’s ex-wife Amber Heard. According to court documents, Musk had a threesome with Heard and model-actress Cara Delevingne at Depp's apartment in Los Angeles in 2016. Elon Musk around 2016 was, making him 45 years old at the time.
The New York Post first reported SpaceX was looking to bring in more funding, and noted, citing unnamed sources, that the capital increase has seen “tepid demand” so far. Elon Musk must have a lot of access to capital given how well Tesla has done has a stock, even without having a sizeable market share advantage that it will be able to realistically keep in the years ahead. As Tesla’s stock goes down, his potential acquisition bid for Twitter becomes less viable.
Investors are in talks to buy new shares in the company at the same time that employees are offering to sell shares via a private placement at the same valuation, the people (sources) said. It’s not clear how dominant SpaceX can become as a Space-tech company, but I personally expect China’s clones of SpaceX to appear fairly soon.
The company’s valuation has soared in the last few years as SpaceX has raised billions to fund work on two capital-intensive projects: the next generation rocket Starship and its global satellite internet network Starlink. SpaceX might enable humans to visit and finally begin to colonize Mars. The timeline on when this actually occurs is somewhat sketchy.
Starship as the Holy Grail
According to many space enthusiasts SpaceX’s Startup is basically seen as the “holy grail”. That is, making human life multiplanetary lies in our ability to make a completely reusable rocket system that can carry a massive amount of equipment, supplies — and people — deep into space.
SpaceX is trying to solve very hard and difficult problems and investors are gambling that it can do it with enough cash, and they may be right.
The vehicle is composed of two stainless steel components, with the company’s first-stage Super Heavy booster at the bottom and the second-stage Starship spacecraft on top. It will be able to carry more than 100 metric tons of cargo and crew per launch.
It’s an incredible feat of engineering and humans are only going to get better at this technology. The scale of a space ship that size is also enormous. Getting all that weight off the ground is no easy task and requires 33 of SpaceX’s Raptor engines for the booster. For good measure, the spacecraft carries an additional seven engines.
Musk has been seeking a variety of funding sources to complete his agreement to purchase Twitter Inc. It’s not clear if this is related. Cathie Wood has sold so many Tesla shares recently that Tesla is no longer the biggest stock in her ARK portfolio, Roku is now.
NASA recently announced that it’s deepening its relationship with the commercial space industry, announcing $278.5 million in funding for six American satellite communications providers. SpaceX got the most. Space Exploration Technologies (SpaceX): $69.95 million. Confidence is high in SpaceX’s ability to scale its technology and it’s becoming pretty consistent.
According to McKinsey & Co., private funding in space-related companies topped $10 billion in 2021 — a tenfold increase over the past decade. Traditionally, most of that funding has concentrated on activities closer to Earth, such as building out satellite communications, but there’s some evidence that may be changing. If Space-Tech can scale and Mars can be colonized, it really opens up a whole new world.
Billionaires have a history of pumping up Elon Musk companies and their stocks. Some experts have estimated that if SpaceX succeeds with Starship alongside its global satellite internet venture Starlink, the company’s valuation could skyrocket into the trillions of dollars. Starlink is on track to do very well even with current limitations to its technology. All of this is in part due to the popularity and good reputation of Elon Musk.
Dare we say that by 2030, the commercial era of Space-tech will be officially here? It’s hard to believe that SpaceX is already 20 years old. It is one of two companies that have been contracted by NASA to provide safe and reliable cargo delivery services to the ISS. The other is Orbital Science Corporation. Elon Musk's SpaceX COO says manned missions will reach Mars by 2030.
I think China will certainly make a Martian base before 2040. You can see SpaceX’s Falcon 9’s recent launch here.
Will humans be multi-planetary beings within our lifetime? It certainly appears that way. Gravity on Mars is about 38% of that of Earth, so you would be able to lift heavy things and bound around. Furthermore, the day is remarkably close to that of Earth. It is a little cold, but we can warm it up. Its atmosphere is primarily CO2 with some nitrogen and argon and a few other trace elements, which means that we can grow plants on Mars just by compressing the atmosphere. Elon Musk is the ideal salesman, he’s an optimist.
It takes a lot of money to make big things happen. However realistically there’s a good chance some of the projects of Elon Musk don’t work, inspite of his super-human ability to raise cash, start new projects and win new Twitter fans (up to 40% of whom may actually be bots).
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