00:00Well, I've been asking Fiona Sincotta, analyst at Citi Index, what she thinks of the $1.75 trillion valuation.
00:08Now, if we think about it, what we're actually investing here is sort of three businesses.
00:11You've got Starlink, which is already generating a substantial revenue.
00:16Then you've got SpaceX, you know, the launch business, which I think also has a pretty dominant position.
00:22And then there's also the sort of long-term optionality of Starship and the wider space economy.
00:27But I think what this is actually about is investors are paying today for profits which may not appear for
00:35many, many years or may not appear at all.
00:37And I think that's where we're seeing this as a bit of a trade-off.
00:40But I think, you know, at that $1.75 trillion valuation, that does feel lofty.
00:47But it would also mean that basically SpaceX is obviously not just a rocket company.
00:52It would be one of the most important technology platforms for the next decade.
00:56So it's going to be very interesting to see whether the market can hold that.
01:00There's also some really interesting features to this IPO.
01:03Some would say controversial.
01:05For example, the dual share structure.
01:08Explain that to us.
01:10Yes.
01:10So basically, ordinary investors will be with Class A ordinary shares.
01:15But Elon Musk will control shares which actually have significantly greater voting rights.
01:21So after the IPO, he's actually expected to retain around 80% of the voting power, which is extremely high.
01:29I mean, on one hand, this does give him the sort of the ability to focus on innovation without sort
01:35of being too distracted by, you know, quarterly market pressures.
01:40But on the other hand, it does raise some concerns over sort of shareholder democracy.
01:45You know, at the end of the day, investors will be providing capital, but actually have very little influence over
01:51decision making.
01:52But essentially, this is sort of a decision over whether you're going to be able to buy, whether you want
01:59to buy into Elon Musk's vision,
02:01because that's very much what you would be doing whilst you're also buying into SpaceX.
02:06And it just really does go to show whether he is able to attract that attention, which he has been
02:12able to do so far.
02:14And also trust.
02:16There's a lot of trust here as well, even whilst he's in the position.
02:19You know, do we trust or do investors trust Elon Musk enough to be able to hand in the keys
02:25to take these decisions?
02:26What happens if something happens to Musk?
02:29And that is a big risk as well.
02:31But then it's also worth pointing out, on the other hand, there are a lot of very successful companies that
02:37were sort of founded by visionary entrepreneurs.
02:39And they have actually benefited from that strong founder control in periods of rapid growth.
02:44So there definitely are two sides to the equation.
02:47I would very much be weighing up the risks that are involved because they are quite great, it would seem.
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