Elon Musk’s SpaceX IPO Strategy 4/2/26

0:00today's tech check. Morning D. Hey good morning, Carl. So Elon Musk. He's selling loyalty disguised as access here in Wall Street is helping him do it. The norm is 5 to 10% retail allocation and an IPO, but Musk wants his following in the stock, not just because they will buy but because he's going to have a lot of money. He's going to have a lot of money and he's going to have a lot of money as they will buy, but because they'll stay and they'll likely vote the way he wants. And he saw this at Tesla where retail owns about 30%. When a Delaware court struck down his $56 billion pay package and called it unfair, retail shareholders they voted to reinstate it anyway. And then last year they approved a new one worth up to a trillion dollars. That was the largest in corporate history, even over the objections of every major proxy advisors and some institutions. Now Musk wants to take a picture into space acts from the jump, except this

1:01time it's a company with no track record. As one source tells me, if he actually needs 30% from retail, that tells you something about the price. Now the only real precedent is Saudi Aramco, which also gave retail about a third of shares and it's listing back in 2019. Now that was widely understood as a loyalty play, nationalistic play, not a market clearing price and the stock. It went sideways for years if you look at it's history retail access. It is a good thing when the price is right, of course, but if SpaceX proves you can hold a $1.7 trillion valuation by loading up on retail, it could also set a precedent for the other blockbuster IPOs this year. No doubt open AI and anthropic are watching this and it could become the playbook for how the entire AI sector pure play AI sector enters public markets, guys. D, how does this all play in with XAI as well in that combination from February? Well, that's the interesting comparison, right? Yes, Tesla has a retail base that it built

2:02over time. Musk is essentially asking retail investors to get in from the get go just a few months after they folded in XAI and a social media platform into essentially a rocket company. So he's asking them to maybe believe from the beginning and let him prove it, which I know you guys were talking about this before, but his timelines aren't always what he says they are. So it's an interesting bottom-up approach versus what we've seen in the markets is growing trend over the last few years is that companies that are already public build this loyal retail base. He's essentially trying to engineer that from the beginning and it is very different because as you rightly say, Carl, you're folding in XAI, which is losing a lot of money and a social media platform. We'll see how he presents this. Due to that, thank you. Due to Bosa.