Imagine throwing a party, selling every ticket twice over before you've even announced the DJ — and then voluntarily handing a third of the seats to strangers who've never been to a party like this before.
That's roughly what SpaceX is doing right now.
SpaceX's initial public offering is well oversubscribed, according to people familiar with the matter, as demand builds for a potentially record-setting debut. Banks leading the offering are expected to stop taking orders from institutional investors on Wednesday after the market closes in New York at 4 p.m. In other words: the professional money has already said yes — loudly.
SpaceX has drawn investor demand of about $150 billion for its IPO, about double the $75 billion it is seeking to raise. The company is in the early stages of the marketing process, and sources cautioned that investor demand is still subject to change before the IPO prices next week.
To put that in plain English: for every dollar of SpaceX stock available, two dollars are lining up to buy it. At $135 per share, SpaceX's post-IPO valuation lands in the range of $1.75 to $1.8 trillion. That would make it, overnight, one of the most valuable companies on Earth.
And yet, into this frenzy — this feeding frenzy of hedge funds, pension managers, and institutional billions — SpaceX has done something genuinely unusual. It decided to reserve a large chunk of shares not for Wall Street, but for you.
The question worth asking isn't whether SpaceX will succeed at going public. That answer is obvious. The more interesting question is: why do they want regular people holding their stock? And what does that tell us about the most sophisticated growth play hidden inside this deal?
