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We Think the SpaceX IPO Is Overvalued

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Re: We Think the SpaceX IPO Is Overvalued

#161

Post by ericd »

naet wrote: post #126
GMoromisato wrote: post #92

A lot (everything?) hinges on orbital data centers. If they don't work, SpaceX is overvalued. SpaceX plans to launch 120 kW satellites, each weighing 1.7 tons. Let's be conservative and say it ends up being a 100 kW satellite massing 2 tons. Let's be conservative and say Starship can launch 50 tons to orbit for $20 million ($5 million more than a Falcon 9 launch). 50 kW per ton x $400K per ton = $8,000 per kW = $8 mi…

I think starlink made intuitive sense; we already use satellites to transfer data for phone service and TV channels, a satellite can "see" a large area to service, the technology was there already, etc. Starlink provides a service you can't really get without going to space (coverage in remote areas). The space data center doesn't make intuitive sense to me. Why put it in space? Wouldn't it be better just... on the g…

The US power grid is not able to keep up with demand, it's mired in red tape. There's also a populist revolt against DCs and the infra upgrade costs being dumped on ratepayers. That's the main benefit I see of their plan, from a US perspective. I think China probably will have a significantly easier time.

Re: We Think the SpaceX IPO Is Overvalued

#162

Post by Atotalnoob »

wmf wrote: post #158
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…

I see it as a hedge against NIMBYs. If terrestrial data centers literally can't be built then orbital is cheaper by definition. If not, just don't build them.

Worse, it’s “don’t worry, the next data centers will be in space, so it’s okay if the ones we are building right now destroy the environment, there won’t be anymore!”

It’s the exact tactic he used with California HSR

Re: We Think the SpaceX IPO Is Overvalued

#163

Post by codechicago277 »

arjie wrote: post #141
redox99 wrote: post #54

Earlier quoted context omitted.

I think this is a very big issue. If SpaceX is very successful, will he pay out dividends, or will he spend everything on a mission to mars at a massive loss or something like that?

If SpaceX is very successful he will spend everything on a mission to mars. He's pretty up front about this. If it costs a lot and the company runs at a loss then it costs a lot and the company runs at a loss. Read the S-1 > We believe that our current space efforts will catalyze transformative breakthroughs that could reshape terrestrial industries and lead to the emergence of new trillion-dollar markets on the Moon…

Only a matter of time before SpaceX starts selling parcels of land on Mars, surprised they haven’t yet. It has to be good for a few extra billions.

Re: We Think the SpaceX IPO Is Overvalued

#164

Post by hparadiz »

SwellJoe wrote: post #157
dilyevsky wrote: post #147

Earlier quoted context omitted.

Pinning CAHSR jobs program as hyperloop's fault is pretty funny. Maybe he did intend to upset it but since both turned out to be massive boondoggles doesn't seem like it worked - they managed to delay it themselves just fine.

Sure, California is a failed state on a lot of fronts, but Musk literally said he was pushing hyperloop for that reason. https://www.fresnobee.com/opinion/editorials/article26445107... Whether he was the only reason for high speed rail being derailed and delayed isn't really the point. He intentionally worked against mass transit, and lied repeatedly about hyperloop as part of that.

> California is a failed state on a lot of fronts

Some people really should just rm -rf their boot disk cause I feel dumber for having read their comment.

Re: We Think the SpaceX IPO Is Overvalued

#165

Post by Grombobulous »

sumeno wrote: post #86
outside1234 wrote: post #71

Earlier quoted context omitted.

It is seriously baffling to me who is going to buy shares in this with 1) this structure and 2) at this valuation. And it is a LOT of money that he is floating ($77B) so there have to be dumb people at scale for this to work.

Look at Tesla stock and you have your answer. This will be another meme stock

It will be interesting to see how this actually plays out.

You could either be 100% right, or this could be another exercise in failed human hubris.

I.e., Elon and the financial architects behind this IPO are assuming that it will work just like Tesla.

However, in the back of my mind I have to wonder if Elon has spent too much social capital for this kind of cult of meme stock strategy to work again.

This plan has potential to backfire since this unique IPO scheme became a big news story. The microscope is on the company more than it was for Tesla.

Re: We Think the SpaceX IPO Is Overvalued

#166

Post by cryptonector »

colechristensen wrote: post #115
ralph84 wrote: post #105

Earlier quoted context omitted.

Voting control doesn't change management's fiduciary duty to all shareholders. The founders retaining voting control has worked out fine for Alphabet shareholders.

It raises the bar to the courts for shareholder control. The Google founders are, lets say, more reliable than Musk when it comes to making sound business decisions.

> The Google founders are, lets say, more reliable than Musk when it comes to making sound business decisions.

I've no idea about that and I won't opine. But every time I see that sort of statement it seems likely motivated by the whole Twitter acquisition. Perhaps that was just a toy or vanity project for him, one he could afford, so even if you think he's running X terribly it might have nothing to do with how he's run or would run any other companies that are not related to social media. In other words, what I read into such statements is "I don't like the politics he's brought to Twitter!", "the board should rein in the guy whose politics I don't like!!". It's like saying Bezos is bad at business because he owns the Washington Post -another vanity project- and you don't like the Post.

Do people not get bored of that sort of take?

Tell me he makes bad business decisions all you want, but in the context of everyone-hates-his-acquisition-of-Twitter I'd like to hear about his other businesses. Tell me something useful, not something political.

And, sure, politics at some point bleeds into business. Maybe Trump is out to get Bezos over Washington Post coverage, or maybe the next Democrat President will go after Musk for his politics. It's possible that X will eventually cost him dearly and personally, and it's a solid argument for these billionaires and trillionaires to stay out of politics. Or maybe it's a good argument for them to stay in because maybe by demonstrating electoral influence and power they can make the POTUS-of-the-day fear them enough to not go after them too hard. But if you made any such argument it still wouldn't say tell me anything about the rest of these billionaires' businesses.

Re: We Think the SpaceX IPO Is Overvalued

#167

Post by jeremyjh »

andai wrote: post #150
Hansenq wrote: post #112

You can absolutely level this claim against Tesla too. When deliveries dropped a year ago, the stock price didn't go down. Tesla's stock is disconnected from the fundamentals and every stock investor today knows this. Why would SpaceX be any different? If anything it would be even more disconnected from the fundamentals than Tesla is, given how much more control it gives Elon. SpaceX stock is a bet on Elon, full stop…

He seems pretty good at figuring stuff out.

Like how he figured out how to destroy half the enterprise value of Twitter?

Like how he figured out how to promise full self driving cars in about six months? For eight years running?

Like how he figured out how to cut USAID programs that prevented and treated malaria and tuberculosis with no plan or warning?

There is never going to be a long-term colony on Mars. It is the most childish conceit imaginable.

Re: We Think the SpaceX IPO Is Overvalued

#168

Post by bandrami »

ericd wrote: post #155
overgard wrote: post #46

Earlier quoted context omitted.

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.

They claim they want to get to a gigawatt per year by the end of next year, so we won't have to wait long to see.

He also claimed in 2015 that nobody would be driving their own cars by 2018. Meanwhile I've seen a driverless car once in my life.

Re: We Think the SpaceX IPO Is Overvalued

#169

Post by cryptonector »

WalterBright wrote: post #117
ianburrell wrote: post #76

Earlier quoted context omitted.

Planet wide high speed rail doesn't make much sense, it is better of medium sized trips. Flights are will always be better for intercontinental trips. Vacuum trains could be faster but would be so expensive to build. Issues would be big deal in evacuated tunnels. CA HSR is slow partly because the state government has limited funds and giving out slowly. The federal government should have been contributing more. The o…

> Vacuum trains could be faster but would be so expensive to build Vacuum trains are what high altitude airliners are.

Nooo, not thaaat!! We want traiiiins!!

Re: We Think the SpaceX IPO Is Overvalued

#170

Post by bobsomers »

laichzeit0 wrote: post #94
dozerly wrote: post #62

Earlier quoted context omitted.

It’s very simple. You should expect he will do whatever benefits himself.

The one thing you can say though, is that “benefits himself” does not mean: buying a super yacht, a casino, an island, etc. So yeah, he’d YOLO and do the Mars trip before any of the above. Which is what most nerds on HN would love, except their blind hatred for Musk would make them despise even that.

Blind hatred? Given that, among a multitude of other things, he willingly threw out some sieg heils I think the hatred was easily earned.
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