Why SpaceX’s $800 billion valuation matters and what it signals about a possible IPO

SpaceX

SpaceX has told employees it plans to buy insider shares in a transaction that values the company at about $800 billion. If the deal closes on the terms outlined, it would put SpaceX ahead of every other private company on paper, including OpenAI, which has recently been valued around the $500 billion mark. The headline number matters because it is not just a boast. It is a price being used for a real transaction, meaning investors and employees are being asked to treat it as credible, the New York Times reported.

The share price in the tender offer is $421, close to double the earlier internal benchmark price. In practical terms, that jump does two things. It rewards early employees who want liquidity without waiting for an IPO, and it gives SpaceX a fresh valuation anchor for future fundraising. It also invites the obvious question: if you are already valuing yourself like a mega-cap public company, why not actually go public?

The plan described by SpaceX’s chief financial officer, Bret Johnsen, involves buying about $2.56 billion worth of shares from existing stockholders. These tender offers have become the standard way for mature private companies to keep employees happy and reduce pressure for a listing. People can sell a portion of their equity, the company can tidy up its cap table, and outside markets don’t get a vote yet.

But the letter also points toward a bigger possibility. Johnsen suggested a public offering is being prepared, while stressing it is not guaranteed and will depend on execution and market conditions. That cautious language is typical. Companies talk this way when they want the option of an IPO without committing to a date.

SpaceX is not valued like a normal aerospace contractor. Investors are pricing it as a hybrid: part launch company, part global communications network, and part long-horizon bet on space infrastructure. Falcon’s dominance in launches and the scale of Starlink have given SpaceX something rare in deep-tech: a story that combines ambition with recurring revenue.

Starlink in particular has changed how people think about SpaceX. Rockets are lumpy businesses. A satellite internet network is easier for investors to model like a utility or a telecom play, even if it still carries huge capital costs. Add in the company’s role with NASA and the Pentagon, and it starts to look less like a venture gamble and more like strategic infrastructure with political weight.

A big portion of the valuation is still about what SpaceX says it will do next. Starship is central to Musk’s pitch: a heavy-lift system meant to make deep-space logistics routine, supporting Moon missions and eventually Mars. SpaceX also has a large NASA contract tied to a crewed lunar mission, and Musk has spoken about a lunar outpost he calls Moonbase Alpha. The catch is that lunar schedules have slipped, and Starship’s path is technically demanding and regulator-heavy. Public investors will scrutinise this harder than private investors do.

SpaceX has raised billions from investors such as Founders Fund and Alphabet, but Musk remains the biggest individual shareholder, with about 44 per cent as of 2022. That level of control can be a strength in execution-heavy businesses, but it also becomes a governance issue in public markets, especially given Musk’s track record of feuds with analysts and short sellers during Tesla’s earlier years.

The simplest reason is capital. Space is expensive, and the ambitions outlined in Johnsen’s letter are even more expensive: far higher Starship flight rates, space-based data centre concepts, more lunar infrastructure work, and Mars missions. Public markets are not just about prestige. They are a funding machine, and they also give early stakeholders a clear exit route.

So the $800 billion number is not just a headline. It is a statement of intent: SpaceX wants to be judged at the very top of the global corporate table. Whether it can persuade public investors to accept that price will depend on one thing above all else: proof that its most ambitious next steps can turn into repeatable execution, not just spectacular demonstrations.