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SpaceX Jumps in First Trades Following Record $75 Billion IPO · Bloomberg Intelligence

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  Speaker 2: I've got this seeing trading. It's now trading. It priced
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  Speaker 2: at thirty five, opened at fifty here at one fifty six.
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  Speaker 2: Anthony Hughes, Bloomberg US Equity Capital Markets Reporter.
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  Speaker 3: What do you think you're Anthony, Well, I think you know,
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  Speaker 3: eleven percent game on the first trade is probably a
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  Speaker 3: number that would for most IPOs would be considered, you know,
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  Speaker 3: what you would hope to achieve. But you know, in
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  Speaker 3: the sense that this IPO, there's a lot of hype
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  Speaker 3: and enthusiasm and a lot of people involved in this deal.
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  Speaker 3: I think maybe people hoping for a bigger number.
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  Speaker 4: I really like the fact that you started there because
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  Speaker 4: the headlines were crossing as of the first thirty minutes
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  Speaker 4: of trade, and the initial headline was that it was
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  Speaker 4: indicated to open at one hundred and seventy five dollars
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  Speaker 4: a piece, and it's been steadily going down we've gotten
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  Speaker 4: headlines about you know, oh, now it's one seventy four,
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  Speaker 4: and now it's one seventy two, Now it's one seventy
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  Speaker 4: all the way down to one hundred and fifty. Is
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  Speaker 4: that about sign Yeah?
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  Speaker 3: Well, just to understand the process a bit better. I mean,
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  Speaker 3: Morgan Stanley's a stabilization agent for the IPL and they
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  Speaker 3: also have the role of opening the IPO. But basically
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  Speaker 3: that process involves bringing together all these buyers and sellers
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  Speaker 3: for this opening print, and you want to make sure
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  Speaker 3: that the opening print is sort of ideally as fair
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  Speaker 3: a price as you can get. And generally speaking from
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  Speaker 3: what I'm told, that banks like to have about ten
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  Speaker 3: percent of the deal size traded in that opening print.
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  Speaker 3: So I think you can see the number there was
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  Speaker 3: around sixty million shares and you know the IPO was
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  Speaker 3: five hundred. You know, about ten percent of the stock
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  Speaker 3: basically went through in the opening print. That's about standard, right,
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  Speaker 3: But that allows the banks to be sort of confident.
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  Speaker 3: I guess that you know, taking the buyers and the
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  Speaker 3: sellers together, the price that you're opening the stock at
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  Speaker 3: is is you know, the price that the market wants
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  Speaker 3: to pay, and then you know looking at the success
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  Speaker 3: of this first day trading. One measure of it will
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  Speaker 3: be like where the stock closed, and you want the
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  Speaker 3: stock to close near to or ideally above where it opens.
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  Speaker 3: You don't want it to like you want to open
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  Speaker 3: the stock really high and then it ended the day lower,
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  Speaker 3: because that meant that would mean that a lot of
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  Speaker 3: people lost money. So you know, that's the art of
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  Speaker 3: opening an IPA. But this is just all one day's trading,
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  Speaker 3: and it's many days ahead.
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  Speaker 2: Yeah, exactly right. We've got close to one hundred million
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  Speaker 2: shares trading hands here again, about one hundred and fifty
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  Speaker 2: nine dollars one hundred and sixty dollars to share open
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  Speaker 2: at one fifty after pressing it one thirty five here.
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  Speaker 2: How long typically will we see I guess higher than
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  Speaker 2: usual volume when a company goes public. Is it that
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  Speaker 2: I'll get kind of exercised the first day? It does
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  Speaker 2: a last a few days.
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  Speaker 5: I think.
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  Speaker 3: I think from my experience, the first day will be
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  Speaker 3: the heaviest day for a while. I mean the first
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  Speaker 3: days will also be relatively heavy. I mean SpaceX. You know,
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  Speaker 3: the interesting thing with IPOs is that, you know, the
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  Speaker 3: art of executing IPOs is to try and place the
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  Speaker 3: stock with as many long term investors as you can
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  Speaker 3: and investors that won't sell. But there's always a portion
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  Speaker 3: of the stock you want to get to people who
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  Speaker 3: are traders because obviously we want stock, some stock to
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  Speaker 3: be in the market for people to buy and sell
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  Speaker 3: and not to sort of overly exaggerate the price if
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  Speaker 3: there's a real supply and demand imbalance. But you know,
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  Speaker 3: I think they from the institutional book, they allocated like
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  Speaker 3: seventy I think was seventy percent of the deal to
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  Speaker 3: what they call long only investors or you know, people
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  Speaker 3: who are people are not traders, and but you are
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  Speaker 3: going to have an element of the you know, as
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  Speaker 3: you know from your experience, you're going to have an
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  Speaker 3: element of the book that's got to be going to
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  Speaker 3: people who are a bit more short short term. But yeah,
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  Speaker 3: the first first first day will probably be the biggest
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  Speaker 3: day of trading. I mean may be different from SpaceX,
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  Speaker 3: but yeah, I mean when you go and see SpaceX
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  Speaker 3: do another maybe they'll do another stock sale in the
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  Speaker 3: future or some sort of corporate event. Might it might
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  Speaker 3: be a die when it's high, but this could be
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  Speaker 3: you know, it could be the highest I'm training for
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  Speaker 3: the stock.
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  Speaker 2: It's interesting. I'm just looking at the rich go function
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  Speaker 2: on the Bloomberg terminal had Elon's steak in SpaceX valued
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  Speaker 2: at one hundred and thirty five dollars to share, which
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  Speaker 2: placed him, again farther away, the number one richest person
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  Speaker 2: on the planet, with a net worth of nine hundred
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  Speaker 2: and seventy billion dollars. Now with the rise and the price,
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  Speaker 2: he's well over a trillionaire. So there you go. That's
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  Speaker 2: also kind of an interesting event, therey in the world's history.
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  Speaker 2: I guess on paper, of course, on paper, of course,
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  Speaker 2: exactly right. This has to be I'm gonna call, let's
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  Speaker 2: just say, if we kind of trade like this today,
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  Speaker 2: you know, you call this a successful IPO and a
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  Speaker 2: successful historic IPO. For many reasons, not just least which
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  Speaker 2: is the dollars involved. That bodes well. I would think
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  Speaker 2: for the anthropics of the world, the open eyes of
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  Speaker 2: the world, which have also filed registration statements to go public,
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  Speaker 2: this has got to.
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  Speaker 3: Be a good sign. Well, I think we'll see how
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  Speaker 3: the stock trace to day. I mean to be honest,
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  Speaker 3: coming out eleven percent out of the gate, you probably
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  Speaker 3: might be a little worried that it could drift back
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  Speaker 3: and maybe end not as well. But you know, I
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  Speaker 3: think the banks have put a lot of work into this,
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  Speaker 3: so you know, maybe maybe they know that they can
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  Speaker 3: get it to finish around where it's where it's opened here,
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  Speaker 3: or maybe there's more enthusiasm from the rest of the day.
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  Speaker 3: But yeah, I think it shows you that seventy five
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  Speaker 3: billion is I mean, we we've reported this is a
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  Speaker 3: huge number. It's a record deal. But you know, I
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  Speaker 3: think even the senior person there at Gold and Sacks
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  Speaker 3: today I saw the note And something I've been thinking
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  Speaker 3: a lot about is that, you know, the numbers we
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  Speaker 3: talk about these days are so much larger than even
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  Speaker 3: even a few years ago. We talk about trillions just
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  Speaker 3: left hand, and you know, the amount of volume you
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  Speaker 3: see in the IPO market we're talking you know, I
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  Speaker 3: think I think the I think we're thinking globally maybe
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  Speaker 3: three hundred billion, you know, someday that if all these
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  Speaker 3: deals happen and and like that's that's a lot of
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  Speaker 3: money to raise. And their market cap is obviously much
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  Speaker 3: bigger than the trillions, but the amount of money that
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  Speaker 3: they're sucking out of the market is is a relative
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  Speaker 3: small amount of you know, well, well below one percent.
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  Speaker 3: You know, it's like, I think the number was something
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  Speaker 3: like twenty bases puts or something. It's not it's not
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  Speaker 3: that much money these days.
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  Speaker 1: What do we know.
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  Speaker 2: About the lockup period here? Typically an ipel lockup is
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  Speaker 2: one hundred and eighty days six months before the insiders
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  Speaker 2: can sell their shares. What do we know about this transaction?
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  Speaker 3: Yes, it's a bit of a long answer to that question.
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  Speaker 3: It is a non traditional lock up. Normally you have
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  Speaker 3: a six month lock up and everyone comes out and
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  Speaker 3: can trade it six months and the stop falls as
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  Speaker 3: a result. But here, you know, yeah, I've got to
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  Speaker 3: take account this is twenty four year old, twenty four
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  Speaker 3: year old company, so you know, it's not like it's
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  Speaker 3: it's not like it had already had a very fairly
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  Speaker 3: developed shareholder base. So you know, there's a logical argument
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  Speaker 3: that you can maybe not have the standard lock up,
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  Speaker 3: but they still have, you know, put some some standards
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  Speaker 3: around it by making sure that the company's going to
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  Speaker 3: have to report its first set of earnings before people
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  Speaker 3: get to start to get out. But even then they'll
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  Speaker 3: there'll be a small proportion of the people who will
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  Speaker 3: be able to sell and then a little bit later
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  Speaker 3: a bit more. But and the whole lock up sort
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  Speaker 3: of basically comes off over a one year period, and
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  Speaker 3: Elon Musk himself is locked up for a year or so,
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  Speaker 3: and he probably wouldn't be selling, I don't think in
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  Speaker 3: any substantial size in any case. But you know, there's
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  Speaker 3: the point, is I guess that he's got he's got
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  Speaker 3: a lot of pre IPO investors alongside him there, and
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  Speaker 3: there are some there are definitely some of those investors
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  Speaker 3: who who aren't investing in the IPO and do want
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  Speaker 3: to get out because they only invest in private companies,
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  Speaker 3: and other investors who are continuing. So that you know,
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  Speaker 3: there's all different types of investors involved in an IPO
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  Speaker 3: like this, and some of them are going to want
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  Speaker 3: to sell and some of them are going to hang on,
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  Speaker 3: and it's just going to be a bit of a
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  Speaker 3: different bit different. But the lock up structure is quite complex,
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  Speaker 3: stretches over a year. There are multiple multiple I think
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  Speaker 3: it's eight to ten, might even be more periods when
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  Speaker 3: a little bit of stock comes out like seven percent here,
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  Speaker 3: eight percent here, and you know it's very it's all
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  Speaker 3: outlined in the prospectives, but it's quite it's quite lengthy
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  Speaker 3: and well considered.
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  Speaker 2: So how about the retail coupon it? Yeah, do we
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  Speaker 2: know generally how much kind of went to the retail.
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  Speaker 3: Yeah, so I think if we look at the IPI
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  Speaker 3: was like seventy five plus the green shoe, which will
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  Speaker 3: be exercised because the stocks traded up will likely be exercised.
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  Speaker 3: I think our understanding was that twenty percent of the
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  Speaker 3: deal went to retail, so that would be a little
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  Speaker 3: bit less than twenty billion dollars. The demand was more
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  Speaker 3: than one hundred billion, and you have to you know,
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  Speaker 3: when you talk about retail, after there's different types of retail.
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  Speaker 3: There's the rich, rich, high network customers of the banks,
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  Speaker 3: and then there's the robin Hood. There's you know, there's
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  Speaker 3: the whole spectrum. There's the robin Hood customers. I mean,
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  Speaker 3: if you talk about the robin Hood customers from all
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  Speaker 3: the what people have said this morning, it sounds like
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  Speaker 3: all hundreds of thousands of robin Hood customers got at
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  Speaker 3: least a share, and that was the case probably with
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  Speaker 3: some of the other digital platforms as well. But a
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  Speaker 3: lot of people are disappointed because they only got one
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  Speaker 3: share but maybe now they look at and see ten
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  Speaker 3: percent gain, maybe they're not so disappointed. I don't they
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  Speaker 3: looking at just taed.
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  Speaker 2: Tesla stock's down two percent here today, down thirteen percent
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  Speaker 2: for the year, up twenty two percent for a trailing
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  Speaker 2: twelve months. You're and of course one of the storylines
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  Speaker 2: out there, Anthony, is that Elion's just for for no
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  Speaker 2: other reason, just for keeping everything neat and tidy, just
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  Speaker 2: kind of have SpaceX acquire a roll up into SpaceX.
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  Speaker 2: I know that was discussed out there in the marketplace.
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  Speaker 2: Do we expect they're hearing anything from the company on that, Well,
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  Speaker 2: it's unclear.
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  Speaker 3: I think that something that people are expecting to happen,
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  Speaker 3: it might have some industrial logic, I think, particularly because
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  Speaker 3: there's different things that pretty you know, big ambitions that
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  Speaker 3: Tesla has around robotics, which makes might make more sense
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  Speaker 3: in a in a in a business like SpaceX, with
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  Speaker 3: a business like SpaceX where there's so many of these big, big,
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  Speaker 3: big projects and ambitions that they're trying to pursue, and
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  Speaker 3: you know, maybe robotics in space together makes a lot
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  Speaker 3: of sense. And you know, but but I think we
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  Speaker 3: might be a while before we hear about that. I mean,
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  Speaker 3: I think people do expect that to happen, but it's
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  Speaker 3: you know, it has to make sense for you know,
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  Speaker 3: based on you know, how these you know, how these
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  Speaker 3: stocks are trading whatever. But I think the main argument
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  Speaker 3: perhaps for that happening from I guess more I could
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  Speaker 3: say from a more cynical perspective, is that it would
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  Speaker 3: allow Elon musk to you know, to potentially take control
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  Speaker 3: of this bigger entity, because Tesla doesn't have the dual
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  Speaker 3: class structure and SpaceX does. But you know, I think
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  Speaker 3: idea like that would take a while. I think the
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  Speaker 3: other extraordinary thing about SpaceX, though, is that we've really
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  Speaker 3: seen that Elon must get stuff done quickly and quicker
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  Speaker 3: than everyone else. I mean, even the pressure releases, the filings,
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  Speaker 3: the road show, the way the S one was drafted
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  Speaker 3: and filed, everything happened a lot quicker than the average company,
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  Speaker 3: that's for sure.
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  Speaker 4: Stay with us more from Bloomberg Intelligence coming up after this.
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  Speaker 2: Let's go to George Ferguson here. He's been tasked to
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  Speaker 2: lead the research efforts here, involving lots of the analysts
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  Speaker 2: at Bloomberg Intelligence. Because this is a technology play, it's
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  Speaker 2: an AI play, it's a rocket ship play. You gotta
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  Speaker 2: have some experts. Unfortunately, Bloomberg does for all of those businesses. George,
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  Speaker 2: what do you think the buyer of a SpaceX what
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  Speaker 2: do you think the buyer of a SpaceX share? What
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  Speaker 2: is he or she thinking here when they place that order?
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  Speaker 5: Yeah, I mean, I honestly think most of them are
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  Speaker 5: believers in Elon Musk, believers in his vision of the
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  Speaker 5: future and his ability to get things done. Because I
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  Speaker 5: think you've got to be a big believer to buy
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  Speaker 5: in it at these valuations. So that's why that's where
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  Speaker 5: I think. That's why I think you saw so much
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  Speaker 5: of the IPO get shunted into the retail side of
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  Speaker 5: the world, and because I think that's where you see
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  Speaker 5: a lot of support and buy into that vision.
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  Speaker 4: It feels like the SpaceX IPO is a real beast.
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  Speaker 4: You look at this perlative surrounding it. It's the biggest
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  Speaker 4: IPO ever, it'll be the first company to move people
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  Speaker 4: to Mars, that it's going to mint that world's first trillionaire.
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  Speaker 4: I almost said billionaire and I had to correct myself. Now
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  Speaker 4: we have that, And this is kind of the point,
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  Speaker 4: right George. I mean, this is the Elon Musk formula.
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  Speaker 4: Create an entirely new category and then you know, claim
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  Speaker 4: leadership and set the standard and you know, make everyone
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  Speaker 4: follow in your footsteps. If that's the case, how does
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  Speaker 4: someone analyze a company like this, because whatever you do,
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  Speaker 4: he's going to come back with, well, it's never been
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  Speaker 4: done before, so you can't you know, compare to anything.
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  Speaker 5: Yeah, I mean that's why it's extremely hard. But I
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  Speaker 5: think when you know, when you look at it, I
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  Speaker 5: think we do understand pretty well the launch business as
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  Speaker 5: it stands today. We understand the connectivity business, the satellite
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  Speaker 5: business pretty well. And I think the big variable here
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  Speaker 5: again is that is that AI business, and it's it's
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  Speaker 5: a variable out there for a number of other companies.
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  Speaker 5: But look, I think launch we saw, like you know,
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  Speaker 5: some seventy six percent of the launches were primarily for Starlink.
• 13:05
  Speaker 5: So when we think about the demand for launch in
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  Speaker 5: the future, Look, I think there'll be more constellations that
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  Speaker 5: go up, but I don't think there's going to be
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  Speaker 5: more than five or six LEO constellations in the next
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  Speaker 5: couple decades. And they're the ones that use a lot
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  Speaker 5: of satellites. You know, that's sort of ten thousand plus
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  Speaker 5: kind of constellations. And I think of those five or six,
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  Speaker 5: I think you're going to see two US. They're kind
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  Speaker 5: of you know, Starlink, and they're probably Amazon Leo. I
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  Speaker 5: think Europe might want one of their own. I'm sure
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  Speaker 5: the Chinese want a couple of their own. Maybe India
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  Speaker 5: gets in this game. I don't think anybody else's constellation
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  Speaker 5: is going to get launched on SpaceX launches, right, so
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  Speaker 5: I think it's going to be even I think Amazon
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  Speaker 5: Leo is going to be launched largely on Blue Origin
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  Speaker 5: rockets as they get that going. So I think we're
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  Speaker 5: kind of looking at space kind of a flatish, maybe
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  Speaker 5: a slow growth kind of business as they do government
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  Speaker 5: work and things like that. The connectivity business, you know,
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  Speaker 5: that's all about that's you know, that's data, broadband data,
• 14:05
  Speaker 5: that's direct to sell communications. We kind of understand that too.
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  Speaker 5: We have terrestrial providers if you're in a big population center.
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  Speaker 5: They're going to do it better than SpaceX is going
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  Speaker 5: to do given latency of going to a satellite, problems
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  Speaker 5: of being in buildings. But they're very important areas of
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  Speaker 5: the world that need that connectivity to a satellite to
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  Speaker 5: stay on the you know, on the web and connected,
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  Speaker 5: and that will get better over time. But I think
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  Speaker 5: that's you know, maybe it's a what we're seeing sort
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  Speaker 5: of twenties ish percent growth in the last couple of years,
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  Speaker 5: but some of the metrics are coming down. On the
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  Speaker 5: amount each subscriber spends, it's decently profitable, it's not wildly profitable.
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  Speaker 5: So to me, everything shifts to AI, right, it's a
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  Speaker 5: big bet on data centers, putting them into the sky,
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  Speaker 5: putting them into orbit. It could where you probably be
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  Speaker 5: able to do it cheaper, cool at, cheaper powered, easier,
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  Speaker 5: and then you know, we'll stream data up to satellites
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  Speaker 5: and GROC will help us figure out what to do
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  Speaker 5: in the future. And that's kind of to me, the
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  Speaker 5: big big vision.
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  Speaker 2: Yeah, I'm looking at just kind of where the revenue
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  Speaker 2: comes from. George just on a trailing twelve month basis,
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  Speaker 2: you know, round numbers eleven billion from the connectivity business,
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  Speaker 2: four billion from the space business, and then at the
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  Speaker 2: bottoms AI at three billion of revenue. But when you
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  Speaker 2: think about a company that's going to be valued at
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  Speaker 2: at least ninety five times revenue, it seems like the
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  Speaker 2: buyer today is saying, I'm putting my money on this
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  Speaker 2: AI thing because I think that's going to be something
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  Speaker 2: just astronomical. I guess it's the AI play that kind
• 15:40
  Speaker 2: of gets you to where you need to go for
• 15:42
  Speaker 2: if you're a long term investor.
• 15:44
  Speaker 5: Yeah, I think if you look, you know, if you
• 15:47
  Speaker 5: look at some of the recent deals cut with Anthropic, right,
• 15:49
  Speaker 5: so what that's a billion and a quarter a month.
• 15:54
  Speaker 5: You know, I guess as long as they keep signing
• 15:56
  Speaker 5: that agreement, you're going to see that AI revenue jump
• 16:00
  Speaker 5: up pretty dramatically here over the over the next year
• 16:04
  Speaker 5: and years. Right. So, I think when we look at
• 16:06
  Speaker 5: sort of what we think is going to be at
• 16:07
  Speaker 5: the end of twenty twenty six, we think it's going
• 16:10
  Speaker 5: to be a fourteen billion connectivity business and a fourteen
• 16:13
  Speaker 5: billion rev AI business. And I think one of the
• 16:17
  Speaker 5: interesting things we saw was, right is SpaceX built Colossus
• 16:21
  Speaker 5: one and Colossus two. The two big data centers down Memphis,
• 16:25
  Speaker 5: Tennessee area. They did it in existing buildings so they
• 16:28
  Speaker 5: could get it up and running very quickly. He you know,
• 16:32
  Speaker 5: it's sort of in typical Elon muskway. He's looking to
• 16:35
  Speaker 5: drive down the cost quickly. It's just, you know, that's
• 16:38
  Speaker 5: smart for any business person put a lot of capacity online.
• 16:42
  Speaker 5: Now he has the opportunity to sell some of that
• 16:44
  Speaker 5: to the anthropic. I think Google's in there too, so
• 16:47
  Speaker 5: you're going to see that AI you know, revenue line
• 16:50
  Speaker 5: drive up. But they spend a lot of money to
• 16:53
  Speaker 5: keep that going, right. I think they're going to consume
• 16:56
  Speaker 5: even more than the revenue they bring in. And there's
• 16:59
  Speaker 5: like four or five six billion dollar deficits in an
• 17:01
  Speaker 5: operating margin, sorry, operating profit for that business. So you've
• 17:05
  Speaker 5: got to find a way to power all that investment
• 17:08
  Speaker 5: you need. This IPO is about we're going to invest
• 17:11
  Speaker 5: a lot of that money into data centers, and we'll
• 17:14
  Speaker 5: invest some of it into Starship because we think long
• 17:17
  Speaker 5: term is going to be easier to make those data
• 17:19
  Speaker 5: centers in space. It'll be cheaper, and so that's where
• 17:22
  Speaker 5: a lot of this money goes. That's the best.
• 17:24
  Speaker 4: Stay with us more from Bloomberg Intelligence coming up after this.
• 17:31
  Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
• 17:35
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• 17:38
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• 17:41
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• 17:45
  Speaker 2: Well, let's continue to talk about space. Why not? Ross Helminson,
• 17:48
  Speaker 2: chief operating officer for Space Network Joints US here in
• 17:52
  Speaker 2: our studio, Russell. One of the things that I think
• 17:54
  Speaker 2: got investors attention on this road show is I try
• 17:56
  Speaker 2: to think about the opportunities for SpaceX and for the
• 18:00
  Speaker 2: industries the company and elon identifying a twenty nine trillion
• 18:04
  Speaker 2: dollars total addressable market, do we have any idea where
• 18:09
  Speaker 2: that number really comes from?
• 18:11
  Speaker 6: Well, thanks for having me on again. It's a huge number,
• 18:14
  Speaker 6: it really is. I don't know if m could really
• 18:17
  Speaker 6: add up the numbers. I'm not quite sure exactly where
• 18:19
  Speaker 6: that comes from. But I think the kind of the
• 18:21
  Speaker 6: thesis is what SpaceX is eventually going to become. It
• 18:25
  Speaker 6: really wants to be the infrastructure that's running all industry
• 18:28
  Speaker 6: at all markets. So if you think about, you know,
• 18:30
  Speaker 6: the Internet in the nineties, you know they're really trying
• 18:33
  Speaker 6: to create the backbone for AI infrastructure, infrastructure for this century.
• 18:39
  Speaker 6: So what they're looking to do is put a lot
• 18:41
  Speaker 6: of AI infrastructure in place, lots of chips, lots of robotics,
• 18:45
  Speaker 6: not just for their own use for SpaceX and not
• 18:48
  Speaker 6: just for Tesla, but they're looking to do that for
• 18:51
  Speaker 6: all industries. So if you have a long term view
• 18:55
  Speaker 6: on AI chips and infrastructure and compute, then the argument
• 19:01
  Speaker 6: is that all industries would benefit from that.
• 19:03
  Speaker 4: Of course, of course SpaceX has become a government contractor.
• 19:07
  Speaker 4: It's done a lot of the work that NASA used
• 19:09
  Speaker 4: to do. So one of the addressable markets is the
• 19:12
  Speaker 4: US government and that's a big customer. How can we
• 19:15
  Speaker 4: quantify just how big of an opportunity that would be
• 19:18
  Speaker 4: going forward?
• 19:19
  Speaker 6: So I think it is pretty big. I mean, if
• 19:21
  Speaker 6: you think about the relationship with NASA as well, you know,
• 19:23
  Speaker 6: NASA's focus is shifting to more exploration, but from a
• 19:27
  Speaker 6: government standpoint, it's definitely been more on the national defense
• 19:30
  Speaker 6: gold and Golden Dome type strategy as long as you know,
• 19:35
  Speaker 6: you know, the US particularly wants to be you know,
• 19:37
  Speaker 6: the dominant force and has recognized through Space Force that
• 19:42
  Speaker 6: much of the military will be guided through satellites and
• 19:45
  Speaker 6: that technology. I think it's basically our prime for the
• 19:49
  Speaker 6: US government.
• 19:51
  Speaker 2: So how do you guys think about it? I mean,
• 19:54
  Speaker 2: how does this relate to your company and connect what
• 19:56
  Speaker 2: you guys are doing.
• 19:57
  Speaker 6: Yeah, so we're really focused on the private side. So
• 20:00
  Speaker 6: we're helping space tech companies who are not yet public
• 20:04
  Speaker 6: commercial arted so raise capital, find customers folks, and revenue.
• 20:08
  Speaker 6: And the thing that's really important there is with what
• 20:10
  Speaker 6: the SpaceX is doing is it is going to generate
• 20:13
  Speaker 6: a love liquidity in the marketplace. So as people you
• 20:16
  Speaker 6: will spin out from SpaceX going to get their own thing,
• 20:20
  Speaker 6: it's drawing attention from private equity and venture capital into
• 20:23
  Speaker 6: the market. That's going to draw a lot of capital in.
• 20:26
  Speaker 6: So from our standpoint, it's going to increase this focus
• 20:29
  Speaker 6: on the opportunity. But our argument is though, that it
• 20:33
  Speaker 6: has to be on the basis that there's real customers
• 20:37
  Speaker 6: for those space technologies. And our thesis is that aside
• 20:41
  Speaker 6: from governments you know and NASA who doing space exploration,
• 20:45
  Speaker 6: that's actually in non space industries, so financial markets and
• 20:50
  Speaker 6: you know, global logistics, agriculture, pharmaceutical that's the market there,
• 20:56
  Speaker 6: and that remains an opportunity for a lot of these
• 20:59
  Speaker 6: innovation native companies. I think SpaceX is more of an
• 21:03
  Speaker 6: infrastructure play for those other markets.
• 21:06
  Speaker 4: It's an infrastructure play for now. It could also become
• 21:09
  Speaker 4: an electric vehicle companies soon as well, or that'll be
• 21:12
  Speaker 4: kind of brought into its its orbit because there's a
• 21:15
  Speaker 4: lot of talk about how Elon Musk mighte combine SpaceX
• 21:18
  Speaker 4: with Tesla. That just becomes another kind of company than
• 21:23
  Speaker 4: and not really comparable to what you do.
• 21:26
  Speaker 6: Yes, I think there's a couple of things there, you know,
• 21:30
  Speaker 6: with from SpaceX and Tesla relationship. You know, one of
• 21:33
  Speaker 6: the ideas originally that he wants to get into EVS
• 21:35
  Speaker 6: is ultimately he wants to be able to like have
• 21:37
  Speaker 6: vehicles up in Mars. You know, for that you need
• 21:40
  Speaker 6: electric vehicles and power. So that's part of his broad
• 21:43
  Speaker 6: you know, interplanetary you know species strategy there right, But
• 21:48
  Speaker 6: when it comes back to you know, what's what's back
• 21:50
  Speaker 6: on Earth, it really is about building infrastructure and providing
• 21:55
  Speaker 6: things that are used or created for space but used
• 21:58
  Speaker 6: back down on Earth. And I think there's enough of
• 22:01
  Speaker 6: an alternate market to SpaceX to allow those things to happen.
• 22:05
  Speaker 6: So an example would be the International Space Station is
• 22:09
  Speaker 6: coming down in a couple of years, and there's going
• 22:11
  Speaker 6: to be new commercial space stations going up, which is
• 22:13
  Speaker 6: going to allow drug research and other types of research
• 22:17
  Speaker 6: and in orbit manufacturing to happen. That is going to
• 22:21
  Speaker 6: be core in other parts of the infrastructure that the
• 22:24
  Speaker 6: SpaceX market space X will will not serve.
• 22:29
  Speaker 2: How's the capital raising out there other than SpaceX or
• 22:32
  Speaker 2: companies that want to do space based businesses.
• 22:35
  Speaker 6: It's actually been very healthy over the last number of years.
• 22:37
  Speaker 6: I mean, you could argue it's been quite healthy over
• 22:39
  Speaker 6: the last fifteen years, but the last couple of years
• 22:41
  Speaker 6: there's definitely been an inflow of private capital. You know,
• 22:44
  Speaker 6: it's not for things that are like rockets and hardware
• 22:48
  Speaker 6: and satellites. It's traditionally not been a venture model, but
• 22:51
  Speaker 6: I think they're starting to realize that this is a
• 22:54
  Speaker 6: play towards more venturel like businesses that can run on
• 22:57
  Speaker 6: the infrastructure.
• 22:59
  Speaker 4: He talked about how this will create a liquidity event,
• 23:01
  Speaker 4: this IPO, it's going to make a lot of people rich.
• 23:03
  Speaker 4: We talk a lot about the SpaceX current employees and
• 23:06
  Speaker 4: former employees. If they do become very wealthy and decide
• 23:09
  Speaker 4: to step away and stop working. They may go off
• 23:12
  Speaker 4: and start their own company as well. This creates this
• 23:15
  Speaker 4: large ecosystem. Do you have any sense of timing around
• 23:19
  Speaker 4: how this plays out.
• 23:23
  Speaker 6: That's a hard one because I'm sure there's gonna be
• 23:25
  Speaker 6: a lot of lock ups in there and a lot
• 23:26
  Speaker 6: of people looking to fulfill the SpaceX mission. But I
• 23:30
  Speaker 6: think certainly over the next couple of years you're going
• 23:32
  Speaker 6: to see a lot of that activity happening.
• 23:35
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• 23:44
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