How to buy SpaceX Stock before IPO

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1:03Stop waiting around for the perfect candidate. Instead, use Indeed Sponsored Jobs to find the right people with the right skills fast. It's a simple way to make sure your listing is the first candidate to see. According to Indeed Data, Sponsored Jobs have four times more applicants than non-sponsored jobs. So go build your dream team today with Indeed. Get a $75 Sponsored Job Credit at Indeed.com slash podcast, Terms and Conditions Apply. SpaceX is targeting an initial public offering valuation of $1.5 trillion. A figure that would instantly make it one of the most valuable companies on earth. Yeah. And just to put that into perspective, I mean, that specific valuation is roughly equal to the entire current worth of Tesla. Wow. Right. So we are looking at a massive financial event, essentially positioning this upcoming offering to be a new flagship in the public markets. With all this value locked up before the company even hits the public market, how do regular investors actually get a piece of it without falling into massive financial traps?

2:06Well, the fundamental dynamic of wealth creation has shifted entirely away from the public sphere. Companies are staying private much longer than they used to, meaning the vast majority of value accumulation happens way before retail investors can buy a single share. Because in previous eras, I mean, a tech company would go public specifically to raise the capital it needed. They needed the public market to build their factories, hire their engineers and, you know, grow their footprint. Right. You could buy shares of early personal computing or e-commerce companies as a regular person, hold those shares in your standard brokerage account and just benefit from the explosive exponential growth over the following decades. But now the private equity markets are so flush with institutional cash that companies can scale to absolute global dominance without ever needing to ring the bell on a public exchange. Yeah. And the frustration for the everyday investors is very real. By the time a company of this scale finally decides to offer public shares, it is already a mature trillion dollar behemoth.

3:08Right. The wealth generation that used to be available to everyone has been walled off. Completely walled off. It's accessible only to massive venture capital firms and institutional wealth. You are basically left fighting for the scraps of growth after the major multipliers have already been extracted behind closed doors. So the traditional rules of the market kept everyday people completely locked out of that early growth? They did. But we are seeing a structural shift with the introduction of new financial vehicles designed specifically to punch holes in that wall. Funds like the ARK Venture Fund and the Private Shares Fund, they operate on an entirely different mechanism than traditional venture capital. How so? They allow regular investors to buy into private names like SpaceX, OpenAI and XAI with a remarkably low minimum investment. Like how low are we talking? We are talking about minimums starting at just $500 for the ARK fund. Oh, wow. Yeah. Or $2,500 for the Private Shares Fund. They completely bypassed the old regulatory hurdles that required you to prove you had millions

4:11of dollars in net worth just to participate. This is essentially like getting a VIP backstage pass to an exclusive concert. But you only had to pay the price of a general emission ticket. That's a great way to look at it. You are getting access to the exact same closed-door equity as the massive venture capital firms sitting right alongside them at the table without needing millions of dollars to buy your way in. Right. You get the access. But the mechanics of how these specific vehicles operate there known as interval funds come with a massive trade-off regarding your liquidity. Okay. Well, taking your VIP pass analogy, it is actually more like agreeing to split a cross-country carpool with a dozen strangers. It is incredibly cheap and it absolutely gets you to the destination. But you cannot just ask the driver to pull over and let you out in the middle of Nebraska because you changed your mind or, you know, saw scary news headline. You are locked into the vehicle until the designated rest stops. We get President Barack Obama. Virginia, we are counting on you.

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7:15Exactly. You can only sell your shares during specific quarterly repurchase windows. The fund managers set these dates in advance. And even during those specific windows, the fund typically only repurchases up to 5% of its outstanding net asset value. Wait, so if the broader market experiences a sudden panic and a large group of investors get spooked and tries to pull their money out of the fund all at once, they simply cannot. They cannot. The exit door is mathematically restricted. If the request to sell exceeds that 5% limit, your request is pro-rated. Right, so you might only get a fraction of your money out. Yes, and you have to wait another three months to try again. So you are exchanging the freedom of daily trading for the privilege of holding private equity. That is the trade-off, yes. You have to lock your money up, surrender your control over when you exit and wait for the corporate events to play out. But knowing how people are fighting to buy in, we need to examine why that valuation is sitting at $1.5 trillion in the first place. Yeah, the core drivers.

8:16Right. This massive number is heavily driven by SpaceX pitching itself as the ultimate infrastructure provider for artificial intelligence through orbital compute on its starling satellites alongside massive military contracts. Wait, back up space-based data centers? Yes. The concept involves using the satellite network to actually host artificial intelligence data processing directly in low-Earth orbit. Okay, wow. When you look at the physical limitations of building massive AI data centers on Earth, you run into severe bottlenecks very quickly. Sure, like power grids. Exactly. You have to secure massive amounts of electricity from an aging grid, pump millions of gallons of water just to cool the servers so they do not melt and acquire vast tracks of real estate. And moving the compute infrastructure into space solves several of these physical constraints simultaneously. It does. You have access to constant solar radiation for power, and the natural environment of space provides a completely different paradigm for thermal management.

9:17Right. But this concept goes far beyond commercial tech applications. The United States Space Force is fast-tracking a highly lucrative contract for a project known as Starsheald. Starsheald, right? This is a military-specific classified satellite network designed for highly secure communication and observation. And the catalyst driving these massive defense contracts stems from rising geopolitical tensions and aggressive rhetoric from China regarding Taiwan. Yeah. And when you look at the political landscape surrounding these global tensions, both left-wing and right-wing political concerns point directly to the necessity of these defense contracts. It's a shared focus. Unfortunately speaking, regardless of domestic political affiliation, the push for secure, unassailable communication networks in the face of international threats is a shared, heavily funded priority for global defense. This changes the entire physical structure of the internet and artificial intelligence. It really does. It severely limits the vulnerability of ground-based data centers.

10:19If a traditional data center loses power due to a grid failure, or if undersea communication lines are physically severed by a hostile actor during a global conflict, the trust neural network goes down. Which is a massive risk. But putting the infrastructure in space creates an incredibly resilient web. It opens up an entirely new, highly secure revenue stream that governments are willing to pay a massive premium for. Right. You are moving the most critical data processing and military communications off the surface of the earth entirely. Placing it essentially out of reach of conventional physical attacks. Exactly. Knowing the massive potential value hidden in these space and AI infrastructure projects, we have to look at the structurally flawed vehicles investors are using to try and capture that value. The traps, yeah. Right. Some of these public market structures have deep mathematical vulnerabilities built right into their plumbing. Retail investors are pouring money into exchange-traded funds, specifically vehicles like the private public crossover ETF.

11:20This specific fund holds a large position in SpaceX alongside standard public tech companies. You have artificial intelligence and social media giants that trade every second of the day sitting right next to private space equity in the exact same fund. And the theory behind the structure is to blend the stability and daily liquidity of public companies with the explosive growth of private equity. They achieve the private exposure through special purpose vehicles. Essentially, many companies created just to hold the private shares and then bundle it all into one tradable ticker symbol. So you get the thrill of holding private assets, but you can still sell your ETF shares on the open market whenever you want. That's the pitch, yes. But if financial regulations strictly cap an ETF's private company exposure at 15%, and this fund's private exposure has ballooned past that limit because the private company's grew so fast, doesn't that force a massive problem? Oh, it forces a severe mechanical risk. The regulations capping ill-liquid assets at 15% exist to ensure the fund remains liquid

12:24for the everyday investor. If a massive wave of regular investors decides to sell their ETF shares, the fund managers need to be able to sell their underlying assets quickly to give those investors their cash. And you cannot sell private shares quickly. No, there is no daily buyer for them. Was the private assets in the specific fund grew so quickly relative to the public stocks in the portfolio? The fund could be forced to sell off its private shares just to comply with the rules. Wow. They would have to trim their best performing asset, finding a private buyer at potentially less than ideal terms, just to keep the underlying math legal. Which severely limits the upside for investors using this specific vehicle. It creates a highly frustrating scenario where the fund might be forced to liquidate its winning position right before the initial public offering actually happens. Exactly. You buy the fund specifically to ride that massive private growth into the public market and a regulatory technicality forces the fund managers to cash out your chips early.

13:24Okay. The ETF route has a major structural flaw. Let's look at another option. Yeah. Closed-end funds offer a different path because they do not face that same 15% regulatory cap on ill-liquid private assets. Right. One fund issues a fixed number of shares just once. It is like a limited edition release. Once their shares are out in the world, they trade on the open market between buyers and sellers based purely on supply and demand. And because the number of shares is permanently fixed, the price you pay on the open market can disconnect wildly from the actual mathematical value of the assets the fund holds, known as the net asset value. Correct. The Destiny Tech 100 closed-end fund avoids the 15% rule entirely and holds a significant portion of SpaceX, but it currently trades at a 41% premium to the actual value of its underlying assets. Yeah. It does. Paying a 41% premium is absurd. It is exactly like paying $140 for a $100 bill just because you like the serial number on it.

14:26You are paying purely for the hype of owning the asset, not the actual fundamental value of the company's balance sheet. I actually see the logic in it from a different angle. Really? Highly restricted private market, some investors willingly and rationally pay that hype tax, just to guarantee they have a seat at the table. I guess so. When an asset is this exclusive and tightly controlled by massive institutions, there is no discount rack available for the retail investor. The premium functions as the necessary cost of admission. These investors are calculating that the future growth of these tech monopolies will easily eclipse that initial markup over the long term. I understand the logic of scarcity. But paying this massive premium severely limits an investor's margin for error. Well, sure. The underlying tech companies have to execute flawlessly just to justify the entry price you paid on day one. If you start in a massive hole due to the premium, the company has to grow its fundamental value by 41%. Just for you to break even on your initial investment.

15:27That's the risk. Absolutely. Once this specific fund pays zero dividends, you aren't even getting a cash yield to cushion the blow while you wait for that growth to happen. Sure. If you enjoy tech news like this, take a second and hit the follow or subscribe button on whatever podcast platform you are on right now. It helps to show so much. Thank you. So since pre-IPO access is riddled with heavy premiums, liquidity lockups and regulatory traps, we should examine a strategy that actually pays you to wait for the event to happen. Yeah. This leads us to the post-IPO income strategy. The Nuvee NASDAQ 100 dynamic overwrite fund offers an 8.9% dividend yield. Currently trades at a slight discount to its actual value and will naturally include companies like SpaceX once they go public and join the massive tech indexes. So rather than fighting your way through the restricted private market, locking your money up in an interval fund or paying a massive hype tax for a closed-end fund, you position yourself in the public index where the company is naturally going to land anyway.

16:28Right, the mechanics of how this specific fund generates that massive dividend are highly strategic. Yeah. How does that work? The fund uses a covered call strategy. It holds the major tech stocks in the index, but it actively sells the rights for other investors to buy its holdings at a fixed price in the future. Okay. By selling those contractual rights, the fund generates massive amounts of cash income up front, which then passes on to you as that high 8.9% dividend. Hold on, if they are selling the rights to their best stocks, doesn't that cap how much money you can make if the market skyrockets? It does. Yes. You are sacrificing the absolute ceiling to raise the floor. Okay. To put it simply, imagine you own a house worth $500,000. You sign a legal contract saying someone can buy your house next year for $600,000 and they pay you $10,000 right now for that privilege. Right. The neighborhood stays stable and the house remains at $500,000. You keep your house and you keep the $10,000 in cash.

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18:33See what your brain can really do. Visit onit.com and shop Alpha Brain to unlock your next level. This is O-N-N-I-T dot com. And that cash is your dividend. Exactly. But if the neighborhood experiences a massive boom in your house is suddenly worth a million dollars, you still have to sell it to that person for $600,000. I see. You capped your maximum upside to guarantee cash in your pocket today. This limits massive gains during aggressive bull runs. If a tech stock doubles overnight, the fund has already promised to sell it at a lower price. So you miss out on that explosive peak. And it opens up a steady stream of income and provides significant mathematical insulation against market drops. Yeah, it really does. If the tech sector experiences a sudden downturn, all that cash you collected from selling those contracts, cushions the blow to your portfolio. Exactly. It completely changes the strategy from paying a massive premium for pre-IPO hype to getting paid a steady, reliable yield while safely waiting for the stock to enter the public market.

19:34You are turning patients into an active cash-generating position, letting them market pay you while the complex corporate events play out over time. Retail access to private tech giants is more available than ever. But avoiding hype premiums and structural traps is just as crucial as finding the right company. Once these space and artificial intelligence conglomerates become the largest public entities on Earth, how will that massive concentration shift the balance of power in your standard retirement index funds? If you're not subscribed yet, take a second and hit follow on whatever app you're using. It helps us keep making this. We appreciate you being here.