Elon Musk's companies are getting in the news of late. This is a good thing since it is not due to the eccentric behavior of the CEO.
SpaceX is presently one of the most valuable private companies out there. On the secondary markets, it is one of the most sought after stocks. The company has a value of over $33 billion. It is in the process of putting up 12,000 satellites in an effort to provide communications to all parts of the world.
Elon Musk believes that Starlink has the potential to generate $30 billion per year in revenue. This is about 10x what the rest of the rocket business does. Thus, Starlink is an ideal part of the business to take public.
SpaceX President and COO Gwynne Shotwell said this to a group of investors.
“Right now, we are a private company, but Starlink is the right kind of business that we can go ahead and take public,” Shotwell reportedly said. “That particular piece is an element of the business that we are likely to spin out and go public.”
https://www.cnbc.com/2020/02/06/spacex-starlink-may-ipo-a-new-elon-musk-stock-for-investors.html
If this does happen, it will not be for a couple years. An IPO does not happen overnight and the company will want to get most, if not all, the satellites up, before embarking upon the idea of going public. The belief is that it will take another $10 billion to get the rest of the network going.
Musk makes no secret about his distaste for Wall Street and the antics that place there. He is also not likely a fan of the SEC considering his run in with them. He does, however, like the Wall Street money that pops into his coffers whenever he needs it. Of course, Wall Street is only doing that because they believe in his vision and expect a return.
That said, it would be nice to see Ole Elon break the mold on this one. Instead of having an IPO and feeding tens of millions of dollars in fees to Wall Street banks, not including the stock that they are comped, he could opt for an offering based around tokenization. This would get the heads of Wall Street spinning.
In a couple years time, we will see the entire cryptocurrency space expanded greatly. As more projects come online and start issuing out tokens, value is generated as the entire sector expands it reach. More people will kick of the network effect, likely sending many tokens a great deal higher.
This move would allow Musk to tap into the crypto money that is already out there. Wall Street money is still going to flow in, they will not pass up on this opportunity.
Sadly, it is not likely that the company opts for the tokenization route. Nevertheless, this spin off could be a viable investment when it hits the market. If Musk projections are correct (always something to consider), this could be a major cash cow.
It could be the start of the next communication oligopoly like we see today with mobile carriers. SpaceX is doing what it takes to ensure it is one of the companies in the mix.
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Posted via Steemleo