SpaceX: A valuation built on miracles

Akshara· Host0:00

[upbeat music] In today's episode, we'll break down two important stories. First, we'll talk about how high SpaceX can fly, and then we'll talk about how Indian car makers performed this quarter. Welcome back to The Daily Brief by Zerodha, where we cut through the noise to help you understand what's actually happening in the most important stories from business and markets. I'm your host, Akshara. Today is Tuesday, 26th May. Coming to the first story. It's hard to know what one should make of SpaceX's IPO filings. It is, above all, a picture of extremes. So here's a sample. This January, the SpaceX board granted founder Elon Musk a billion shares of Class B stock, which would vest in 15 tranches as the company's market capitalization would rise. This isn't unusual in itself. Musk would get similar performance grants at Tesla as well. But what's new was a condition. For any of those tranches to vest, he would have to ensure a permanent human colony on Mars with at least a million inhabitants. A different grant from this March could give him another 300 million shares, but those would partly vest once he managed to fly a data center with 100 terawatts of compute a year to space. That's roughly 100,000 times what SpaceX has installed today. Last year, the same company burned through $14 billion of cash, and its debt alone comes to $30 billion. Its capex bill last year was thrice as large as its actual earnings.