Elon Musk’s SpaceX Raised $ 850 Million At $ 419.99 Per Share

SpaceX completed another monstrous $ 850 million funding round last week, people close to the funding told CNBC, pushing the company’s valuation up to around $ 74 billion.

The company raised the new funds at $ 419.99 a share, these people said – or just a cent below the $ 420 price tag that Elon Musk infamously made in 2018 when he said he had “secured funding” to privatize Tesla.

The latest increase also represents a roughly 60% jump in the company’s valuation from its previous cycle in August, when SpaceX raised nearly $ 2 billion to a valuation of $ 46 billion.

SpaceX did not immediately respond to CNBC’s request for comment.

As well as SpaceX building more of a war chest for its ambitious plans, company insiders and existing investors were able to sell an additional $ 750 million in a side deal, one of the people said.

Notably, SpaceX only raised a portion of the funding available in the market, with one person telling CNBC that the company received an “insane demand” of around $ 6 billion in offers in just three days.

The latest influx of cash comes as SpaceX continues to develop two capital-intensive projects simultaneously.

Starlink is its ambitious project to build an interconnected Internet network with thousands of satellites, known in the space industry as a constellation, designed to provide high-speed Internet access to consumers all over the planet. SpaceX management previously estimated that building Starlink would cost around $ 10 billion or more, but estimates that the network could bring in up to $ 30 billion per year – more than 10 times the annual revenue of its business. existing rockets.

To date, SpaceX has launched more than 1,000 satellites for Starlink, while beginning to deploy early service in a public beta to customers in the United States, Canada and the United Kingdom. The company recently expanded the scope of this public beta, allowing potential users to pre-order Starlink Service for $ 99. Pre-order messages tell users that SpaceX is “targeting coverage in your area between mid to late 2021,” while other pre-orders say 2022.

The company revealed in a Federal Communications Commission filing last week that Starlink has “over 10,000 users in the United States and internationally,” in just over three months since the start of the public beta. .

Musk also reiterated last week that SpaceX eventually plans to part ways with Starlink and go public. He said Starlink “has to cross a deep chasm of negative cash flow over the next year.”

“Once we can predict cash flow reasonably well, Starlink will go public,” Musk said.

SpaceX’s Starship rocket represents its other ambitious endeavor, with the company regularly building and testing prototypes in Boca Chica, Texas. The company has successfully launched several prototypes of Starship, landing them safely after short flights at around 500 feet above sea level. But its two most recent high altitude flights, despite passing several development milestones, exploded on impact during landing attempts.

Starship prototypes are constructed from stainless steel, with the company aiming to develop a reusable rocket system similar to a commercial airliner. SpaceX is developing Starship with the aim of launching cargoes and up to 100 people on missions to both the Moon and Mars.

Despite the explosive endings of the last two flights, SpaceX viewed the launches as advancements in rocket development. The next Starship prototype is in place on the company’s launch pad, with SpaceX expected to attempt another test flight in the coming weeks.

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