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We Think the SpaceX IPO Is Overvalued

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Re: We Think the SpaceX IPO Is Overvalued

#41

Post by jmalicki »

datadrivenangel wrote: post #36
kldavis4 wrote: post #10

Earlier quoted context omitted.

The orbital data center thing is really strange. Without some kind of massive technological breakthrough the physics of an orbital data center make no sense. Napkin math for a single data center including solar panels, radiators, compute and structure is somewhere on the order of ~6500 tonnes. Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single…

They'll do smaller satellites, and if they can get an order of magnitude improvement on cooling and power generation to weight ratios, it'll be close to the same order of magnitude cost-wise as a terrestrial datacenter. 10x the cost is likely not enough to make it all work, so it's a bad idea, but it's possibly less bad than using lead ballast for starship launches... maybe.

Is there some reason significant improvement on cooling and power generation to weight generation ratios is even remotely possible?

Re: We Think the SpaceX IPO Is Overvalued

#42

Post by glaucon »

oldfuture wrote: post #15

And the prospectus says it plainly: "Mr. Musk will be able to control the outcome of matters requiring shareholder approval." Musk holds over 85% voting power through Class B super-voting shares (10 votes/share). Public investors combined will have 15%. What Musk Controls: - CEO removal = his consent. You can't fire him even if he destroys the company - Take business for himself. SpaceX gets a rocket deal? Musk can s…

I haven't read the prospectus but I would be interested to know, when he dies, to what degree the "... control the outcome of matters requiring shareholder approval" part will be inherited. Does that facility just go along with the Class B super-voting shares? And if it does what does it mean if more than one person inherits his shares?

On the subject of the governance structure this [1] is worth a read ...

"The company significantly limits shareholders' rights to sue. SpaceX's bylaws will make it clear that anyone who owns shares "irrevocably and unconditionally" waives all rights to pursue a jury trial. Shareholders will also be prohibited from bringing class actions against the company, its directors, officers, controlling shareholders or bankers tied to the IPO, according to the filing.

Instead, shareholders will be subject to mandatory arbitration, which had long been illegal in the U.S. The Securities and Exchange Commission reversed its position, opens new tab in September, allowing companies to adopt mandatory arbitration policies, which are private proceedings overseen by arbitrators."

... I can't remember how much he spent in Pennsylvania but you might argue it was money well spent.

[1] https://www.reuters.com/sustainability/boards-policy-regulat...

Re: We Think the SpaceX IPO Is Overvalued

#43

Post by ink_13 »

tekla wrote: post #24
adgjlsfhk1 wrote: post #19

Earlier quoted context omitted.

Because 50 rocket launches seems hard to make cheaper than a building.

The cheapness of the building is not the problem that is being dealt with. The construction of the building w/ zoning and the political fights and utilities arguments and years of time and whatever is what is being dealt with by putting it in orbit.

I bet you could build a fully off-grid DC that didn't guzzle water for less money than launching a rocket today, and there would be thousands of people lining up down the block to sell you more than enough land to do it a thousand times for cheap. This just isn't happening yet because it is still quite possible to build on-grid DCs supplied with fresh water for cooling despite what some people would have you believe.

And then when you build on the ground you could even send people to it to swap hard drives and GPUs when they inevitably fail or upgrade them to keep them current. At lower rates of failure than they would in space because we have a planetary magnetosphere protecting us from cosmic rays.

Re: We Think the SpaceX IPO Is Overvalued

#44

Post by verandaguy »

I need to understand what possible benefit there is to doing DCs in space. The cost would be, no pun intended, fucking astronomical. The cooling situation would make no sense at all -- the major up-and-coming application of DCs, LLM training, has absurd cooling requirements even here on earth where convective cooling is an option, to the point where many DCs use open-loop cooling. Latency might be better, in some cases, I guess, but probably not by some groundbreaking amount.

Who is this product for? How the hell did "data centres in space" make it into the prospectus at all?

More to the point, why is Morningstar being so generous with their interpretation of that line of business? It's plainly insane, and you don't need an advanced degree in physics to understand why.

Re: We Think the SpaceX IPO Is Overvalued

#45

Post by kaashif »

tekla wrote: post #24
adgjlsfhk1 wrote: post #19

Earlier quoted context omitted.

Because 50 rocket launches seems hard to make cheaper than a building.

The cheapness of the building is not the problem that is being dealt with. The construction of the building w/ zoning and the political fights and utilities arguments and years of time and whatever is what is being dealt with by putting it in orbit.

It would be extremely funny if putting things in space is cheaper and faster than dealing with zoning and local politics.

It implies that China, which can cut through much red tape and has great (and improving) utilities and infrastructure, lots of energy, can just build normal datacenters and save the cost of dozens of space flights.

Re: We Think the SpaceX IPO Is Overvalued

#46

Post by overgard »

kldavis4 wrote: post #10
m-hodges wrote: post #2

> Even at $63 per share, we give SpaceX a lot of benefit of the doubt in two of the three scenarios, in which we assume the company can achieve a rapidly reusable Starship rocket enabling multiple launches per week and successfully commercialize data centers in space. > In our downside scenario, orbital data centers won’t work or offer any advantage over terrestrial ones. We surmise that the company, having invested…

The orbital data center thing is really strange. Without some kind of massive technological breakthrough the physics of an orbital data center make no sense. Napkin math for a single data center including solar panels, radiators, compute and structure is somewhere on the order of ~6500 tonnes. Let's say Starship can put 100-150 tonnes into orbit per launch, that is somewhere between 40-65 launches for just one single…

I'm pretty sure he's full of shit and has zero real intention of building orbital data centers. It makes for a good headline, which is what these AI companies are in the business of. The math doesn't math and the logistics of maintaining and building the datacenter seem insane.

Re: We Think the SpaceX IPO Is Overvalued

#48

Post by SwellJoe »

pryce wrote: post #35
hparadiz wrote: post #17

Earlier quoted context omitted.

The video they posted today outlines their specs. They are gonna be smaller. About 100T. Based on Starlink architecture but with way larger radiators and solar panels. Apparently the design is simpler than existing Starlinks because it has fewer different parts. Specs: https://x.com/SawyerMerritt/status/2064108916611420273?s=20

I feel like we are going to relive the hyperloop-decline with the specs of proposed orbital datacentres. But the hyperloop was in one regard a success, in that it built temporary hype. Maybe it was even named after that.

It also achieved Musk's actual goal: derailing and delaying mass transit initiatives, the California High-speed Rail project, in particular.

He knew it was bullshit. He's dumber than most people realize, but he's not dumb enough to actually believe all the bullshit he spouts.

Re: We Think the SpaceX IPO Is Overvalued

#49

Post by jbxntuehineoh »

kldavis4 wrote: post #34
jiggawatts wrote: post #18

Earlier quoted context omitted.

The actual “plan” is to just put a couple of GPUs in each Starlink satellite for inference. They’re not launching something the size of a building!

That just doesn't seem to justify anywhere near the valuation though does it?

shhhhhh the line WILL go up, whether you like it or not

Re: We Think the SpaceX IPO Is Overvalued

#50

Post by goldforever »

jmyeet wrote: post #23

From SpaceX's S-! it bases its valuation on the total addressable market of 3 markets, which is made up of: 1. Space operations: $370 billion; 2. Connectivitiy: $1.6 trillion, roughly split between mobile and broadband; and 3. AI: $26.5 trillion, which includes $22.4T in AI Enterprise applications, $2.4T in AI infrastructure, $760B in subscriptions (ie Grok) and $600B in digital advertising. So immediately we see the…

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