How did SpaceX get to be a $2.5tn company?
That’s the right question. Not “is it worth it” - how did it get there.
That’s the right question. Not “is it worth it”, how did it get there. Because it’s not a valuation. It’s a story with a massive price tag, and the story is the best one ever told.
Read the S-1. They claim a $28.5tn market, then admit a few pages later it “may not be accurate.” And how’d they get to $28.5tn? Forty-odd consultant reports they didn’t pay for, run through “management’s interpretation,” topped with three separate disclaimers telling you not to rely on it. Big-number masturbation to blow our little minds, with no consequences for any of it.
Take the story away and what’s actually there?
Starlink. A real business, $11.4bn revenue, fat margins. Everything else is just burning: $4.9bn lost last year, another $4.3bn in Q1, a $41bn hole and counting. Starlink alone doesn’t get you near $2.5tn.
So where’s the rest coming from? The bit written by Asimov, of course. The company tells you itself, describing the Moon bases and the asteroid mining: “technologies that do not exist.” Their words, in the filing.
Now watch the engineering, because this bit already happened.
Buy Twitter at $44bn. Fold it into xAI. Fold xAI into SpaceX. Every step a common-control merger, every step a fresh mark, the whole lot recast in the accounts like it was always one company.
Revenue barely moved. Losses went vertical, $6bn gone in the AI segment alone. And the mark went up the entire way.
That’s not value creation. That’s value declaration. He didn’t build the business, he re-papered it three times and the market clapped each time. Value asserted through structure, not earned through cash flow.
And here’s the cleverest bit, the same trick aimed at himself.
Everyone reads his pay packages as the ultimate alignment. Tie my comp to the share price, I only win if you win. Brilliant optics. But look at what it actually does. The targets are market-cap milestones, not cash milestones. So he’s not paid to make money, he’s paid to move the price. And the price moves on the story. He’s literally incentivised to grow the narrative, because the narrative is the thing he’s best at. The KPI isn’t a check on him. It’s a reward for doing exactly what he was already doing.
And the size does its own work. A pay number so absurd it stops reading as money and starts reading as conviction. Look what he’s tied himself to, he must believe. Same as the $28.5tn, too big to evaluate, so you stop evaluating and start feeling. The bigness is the persuasion.
Then check the votes. Class B, ten votes a share, electing a majority of the board. “Controlled company” status, which lets him skip the independent compensation committee, the one body that’s meant to sit between a CEO and his own pay. So he sets the package, through a board he elects, with votes that outweigh what he actually owns. He sells you “fully aligned” while building the exact structure that means nobody can ever hold him to it.
It’s the same play at every level.
On the market, a TAM you can’t check. On the businesses, value declared through mergers, not made. On himself, pay that rewards storytelling and a vote structure that removes the referee. Three layers, one trick: pick a number too big to test, and let our own greed and awe do the validating for him.
And it’s not hidden. It’s all in the filings. We just don’t read them.
So what comes next?
Watch for the reverse-merge into Tesla. Tesla’s already in the S&P. SpaceX, losing money, can’t get in on its own numbers. Fold it in and every index tracker on Earth becomes a forced buyer overnight. Then pile the sci-fi back on top, Optimus on the Moon, robots mining asteroids, factories in orbit, and the merged thing carries a $10tn cap. A dream too far out to ever be proven wrong in time to matter.
The story is the funding. The dream makes capital cheap, cheap money builds the one thing that works, and that makes the dream look real. The belief pays for itself. Works right up until the real business stops outrunning what the dream burns. Right now the fire’s winning.
He’s not going to build a meaningful off-world economy in his lifetime. But he’s laid the foundations for two things: a real space economy, and proof that we’re suckers, driven by greed.
Respect to the man. He’s a genius, not at rockets, at us. At reading the system and the psychology that moves the herd. He didn’t really hack physics. He hacked us and our belief system.
For the ❤️ of startups
✌🏼 & 💙
Derek
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