ADRIAN FLORIDO, HOST:
For years, SpaceX was one of the hottest investments that ordinary investors could not buy. That is no longer true. Shares started trading yesterday, and investors rushed in. The stock surged on its first day of trading, which pushed the company's value above $2 trillion and made Elon Musk the world's first trillionaire. But investors aren't just betting on rockets. They're betting that SpaceX can become one of the companies shaping the future of artificial intelligence.
Micah Maidenberg covers space for the Wall Street Journal. He is on the line to help us unpack what this IPO means for investors and the space industry and for the rest of us. Micah Maidenberg, welcome.
MICAH MAIDENBERG: Thanks for having me, Adrian.
FLORIDO: This stock's first-day pop was really incredible. But now that we've had, you know, a day or so to digest it, do you have a better sense of why investors did rush in to scoop it up? Was it confidence in the existing business or SpaceX's more ambitious visions for the future of AI and space exploration? Or was it because everybody just wanted a chance to get in on Day 1?
MAIDENBERG: Honestly, I think it's a little of all of those things. I mean, certainly, like, if you look at the market value that the company hit yesterday, that does reflect a bet on AI and the expectation that SpaceX's AI business is going to be a very, very big one. A lot of retail investors were excited to get exposure to a company they couldn't, as you alluded to, a company led by Elon Musk, a company that has had a lot of mystique and a lot of success on the space side - you know, launching rockets, building up Starlink - and is now orienting itself toward artificial intelligence in a very big way.
FLORIDO: SpaceX was a private company for almost 25 years. Why did Elon Musk decide to take it public now?
MAIDENBERG: You know, it's funny. I mean, executives at SpaceX used to talk about no public offering. We're not going to go public until we're regularly flying to Mars. And of course, that's not the case yet at SpaceX. But the reason Musk and the team made this call is - again, it goes back to artificial intelligence.
Just a few months ago, SpaceX was a rocket company, a satellite operator. It's still very much those things, but now it is deep in the race to build artificial intelligence technology. It's competing against and working with, in some cases, the other big AI companies. SpaceX was a very successful company as a space company. Elon Musk brought in his AI startup and sort of fused those together and is now betting on sort of a convergence between space and artificial intelligence. So that requires a lot of capital, and I think that's why we saw the IPO.
FLORIDO: This initial public offering has created just these monumental, enormous, almost impossible to imagine amounts of paper wealth overnight. Early investors have become billionaires. Many employees who have been paid in company stock are now millionaires on paper. What does this mean for places where, you know, a lot of these SpaceX employees are concentrated, especially in places like Texas?
MAIDENBERG: It's a great question. I was recently in Cameron County, Texas. That's home to Brownsville. That's home to SpaceX's headquarters at Star Base, where they launch Starship rockets from. And, you know, talking to folks around Brownsville and Cameron County, for example, a lot of people there are trying to figure out, like, what this is going to mean - how spending, wealth, investment may or may not show up, you know, on the ground. What will that mean for the housing market, for retail, for other development? I think in some ways, there's more questions than answers at this point.
Another trend I just will mention really quickly is, there's been a lot of former SpaceX employees over the last few years who've gone off to found other companies in space and defense, technology concerns. I suspect, having talked to a lot of former employees, there will be more of that. More people will take this paper wealth and give a startup a shot. Some might go into professional investing, that kind of thing. You can bet that current and former employees who've seen their wealth just dramatically change overnight are definitely thinking about all these questions.
FLORIDO: When a company goes public, investors typically get more visibility into its finances and operations. What are we likely to learn about SpaceX in the next few months that maybe we haven't been able to see up until now because it has been a private company?
MAIDENBERG: A lot of the details about SpaceX's finances, its operations, its assumptions, have been under sort of literal and metaphorical lock and key and have been for many years. That changed - right? - in this IPO process. I think going forward, we're going to learn a ton about how the company spends money, what it costs to develop satellites, to conduct rocket launches, what it is going to take to fully build out Starship, you know, this enormous developmental rocket that is at the center of a lot of the company's ambitions. We're going to learn things about executive pay and stock compensation, the board, other executives underneath Elon Musk. And just a lot of that used to be just extremely hard for anybody to see.
FLORIDO: Well, Micah Maidenberg covers space for the Wall Street Journal. Micah Maidenberg, thank you so much for coming by to with us.
MAIDENBERG: Thanks so much for having me.
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