SpaceX sets its IPO price at $135 per share, valuing the company at $1.75 trillion and making it a record listing.

      Companies typically finalize their price last when going public. They establish a price range, conduct a roadshow, gauge institutional interest, and allow demand to influence the final share price. However, SpaceX has chosen to do the opposite.

      The company intends to set its IPO price at $135 per share before the roadshow even starts, aiming for an unprecedented $75 billion raise, as per a source familiar with the situation.

      This approach is noteworthy due to its unconventional nature, essentially making a statement. By fixing a price prior to the bookbuilding process, it eliminates the customary negotiation where investors typically push down the valuation. It makes it clear that the terms are non-negotiable.

      At a price of $135 per share for around 555.6 million shares, this IPO would mark the largest ever, implying a valuation of approximately $1.75 trillion. SpaceX plans to trade on the Nasdaq under the ticker SPCX, with expected trading on June 12.

      This isn’t SpaceX’s first step toward the public markets; readers of TNW have closely observed its progression. Earlier this year, the company filed its S-1, paving the way for what would become the largest listing to date. The prospectus confirmed that Musk and other insiders will maintain significant voting control through a dual-class structure. The fixed price represents a further escalation: having set the stage on its own terms, SpaceX now aims to establish its price on similar grounds.

      The reasoning behind the $1.75 trillion valuation is that SpaceX has evolved beyond being merely a rocket company. Its acquisition of xAI in February integrated Musk’s AI startup into the launch and satellite operations, presenting the merged entity as not only a space enterprise but also an AI infrastructure player.

      Funds from the IPO will partly go towards enhancing AI computing capabilities alongside the Starlink satellite network. When the roadshow occurs, it will essentially promote two narratives simultaneously.

      The inclusion of retail investors adds to the spectacle. Reports indicate that SpaceX may allocate as much as 30% of the offering for individual investors, significantly higher than the typical single-digit allocations for deals of this magnitude.

      This strategy serves both to engage its dedicated retail fanbase and as a protective measure: a price set prior to bookbuilding relies on widespread demand rather than just a few institutions deciding the final price.

      Despite this, not all are convinced that the price is justified. A Danish pension fund has already blacklisted this IPO on governance grounds, pointing to the centralized voting control and what it views as an inflated valuation.

      This criticism is central to the deal. Investors purchasing SPCX shares will have limited influence in a company managed by a founder whose focus spans rockets, satellites, AI, social media, and electric vehicles.

      The argument for this valuation rests on the premise that traditional rules adapt to businesses that outperform competitors. SpaceX propels more mass into orbit than all other operators combined, Starlink boasts a multi-million subscriber count, and the collaboration with xAI adds an AI narrative during a time when the market values such ventures highly.

      Conversely, the argument against fixing a price prior to the roadshow suggests an assumption of demand that the roadshow itself is designed to assess. If demand is strong, SpaceX will have transformed the pricing approach for mega-IPOs. However, if interest falls short, there won’t be a fallback range to retreat to.