With the public listing of his space exploration technology company (SpaceX), Musk is about to become the world's first trillion-dollar rich man. According to the IPO prospectus updated by SpaceX on Wednesday, Musk’s equity in the recyclable rocket company is valued at $866.5 billion. SpaceX disclosed that it plans to set the issuance price of its upcoming IPO at US$135 per share, corresponding to the overall enterprise valuation of approximately US$1.77 trillion.
For Musk, 54, the SpaceX IPO comes 16 years after he took Tesla public. Today, he owns a stake in the electric car maker worth about $355 billion and has options that could add more than $100 billion to his wealth.
Documents filed on Wednesday show that Musk will have more than 82% voting control of SpaceX after the listing. However, all the shares he holds must be locked up for one year and cannot be transferred.
"We believe that Mr. Musk's substantial holdings in our company provide him with a financial incentive to drive the success of our company," SpaceX said in the risk factors section of its prospectus. After the 366-day lock-up period ends, "Mr. Musk will no longer be obligated to maintain his holdings in our company, and at any time thereafter he may elect to sell all or a majority of his stake in our company, or to reduce his percentage shareholding in our company."
Musk's personal net worth has continued to rise over the past decade, and Tesla's stock price has risen sharply since 2013. In 2021, his net worth surpassed that of Amazon founder Jeff Bezos and became the world's richest man for the first time. Although Tesla's stock price fell 65% in 2022, it rose again in the following years and hit a record high.
"Forbes" currently estimates Musk's net worth at $826 billion, far behind the second-ranked Google co-founder Larry Page, who has a net worth of less than $300 billion.
If SpaceX is valued at or near expected levels when it debuts on Nasdaq next week, Musk will own two of the eight most valuable companies in the United States. Among the trillion-dollar companies, SpaceX’s valuation will be higher than Tesla and Meta.
But in terms of revenue scale, SpaceX is far less than the above-mentioned large technology companies. The company achieved revenue of $18.67 billion last year; during the same period, Meta's revenue exceeded $200 billion and Tesla's revenue was close to $95 billion.
Recently, some investors have speculated that Musk's ultimate plan may be to promote the merger of SpaceX and Tesla to integrate artificial intelligence resources and simplify the subsequent financing process. Musk holds lucrative equity incentives in both companies, and some of the performance appraisal targets are extremely challenging.
SpaceX has tied Musk's compensation awards to two major goals: reaching a market value of $7.5 trillion and building a settlement on Mars with at least 1 million permanent residents. At the same time, Tesla shareholders approved a compensation plan that is divided into 12 installments at the end of last year, and each installment of compensation is linked to market value growth and operating performance.