SpaceX investor's thread

[abasile]

One consequence of SpaceX being private is that the share price is likely much lower than if it were publicly traded. Whereas the Tesla stock price tends to be volatile, the SpaceX price seems likely to remain relatively stable and continue to increase in a monotonic manner. In the event of a prolonged recession, I feel that SpaceX shares will hold their value, but the Tesla share price could drop substantially, at least for a while.

On the other hand, what difference does it make if the SpaceX share price remains stable if it's nearly impossible to liquidate? Or would it be nearly impossible? I suspect that if anyone on this thread were to express interest in liquidating their interest in SpaceX, they wouldn't have difficulty finding buyers. Any ensuing transaction would have to be approved by the management of the relevant SPV (Special Purpose Vehicle), but hopefully that wouldn't be too big an issue.

I wonder if people have really thought through what is means to be a lunar or Martian colonist. It means raising kids there. And those kids probably wouldn’t develop the bone structure to exist on Earth. It’s a one way ticket for future generations.

I've also considered that problem. Perhaps it could be mitigated by regularly exposing all colonists to artificial gravity equivalent to 1g. That could be accomplished using very large centrifuges on or below the lunar and Martian surfaces. The "floor" of each centrifuge, where people would spend time, would be tilted at an appropriate angle relative to the planetary surface.

Going a step further, perhaps residences could be constructed atop centrifuges. This would be expensive, but I think the vast majority of colonists, particularly early colonists, would consider it essential to give their offspring the ability to spend time on Earth. For that matter, preserving bone health and muscle tone would be of importance to the initial colonists as well.

 

[Cosmacelf]

FYI, someone is putting an investment pool together, zero fees. Has he really thought this through? Every time someone wants to sell their SpaceX shares, he will have to get involved. When Starlink gets spun out, he will have to contact each pool participant and get the brokerage info, correct mistakes, etc.

https://twitter.com/bradsferguson/status/1314392986575343616

 

[Bet TSLA]

This appeared in the main investors' thread as a possible new way to invest in SpaceX:
Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable
Tweet here:
https://twitter.com/bradsferguson/status/1314392986575343616

Anybody know anything about this? Or have an opinion one way or the other? On LinkedIn I see this entry for Bradford Ferguson. And I noticed he's a supporter of Joe Tegtmeyer's YouTube Texas Gigafactory videos (e.g. this).

I sent Brad a Twitter DM and got this response:
We got 130 investors and $33M+ assembled. If you want in and want to see the update I sent out this week, I need to know (1) How much would you want to invest in SpaceX (2) first/last name, & (3) _best_ email address?

I replied with the information. We shall see where it goes. No e-mail yet.

 

[Cosmacelf]

This appeared in the main investors' thread as a possible new way to invest in SpaceX:
Tesla, TSLA & the Investment World: the 2019-2020 Investors' Roundtable
Tweet here:
https://twitter.com/bradsferguson/status/1314392986575343616

Anybody know anything about this? Or have an opinion one way or the other? On LinkedIn I see this entry for Bradford Ferguson. And I noticed he's a supporter of Joe Tegtmeyer's YouTube Texas Gigafactory videos (e.g. this).

I sent Brad a Twitter DM and got this response:
We got 130 investors and $33M+ assembled. If you want in and want to see the update I sent out this week, I need to know (1) How much would you want to invest in SpaceX (2) first/last name, & (3) _best_ email address?

I replied with the information. We shall see where it goes. No e-mail yet.

Keep us up to date. Brad is going to learn that wrangling 130 investors in neither easy, quick, error-free, inexpensive, and liability-free. There is a reason why funds that do this charge fees. And there is a reason why fees are generally large (like 5% instead of 1%, and have management fees) and price competition hasn't whittled it down to something more bite sized.

With 130 investors, my guess is you're going to have a couple of investors a month, every month, who want to cash out/sell their shares. Who facilitates that? When Starlink is spun out, who is going to contact all investors, get their brokerage info and piece out the Starlink shares into the various account, fix mistakes, assume liability for wiring 7 figures sums to the wrong account, etc.

 

[MP3Mike]

Elon recently replied to someone asking about investing a pool of money:

Elon Musk @elonmusk
Oct 7

Replying to
@TeslaTested
We just completed a financing round, but will let you know when there is another one

I don't know if that is the same group of potential investors or not, but it doesn't sound like there is a funding round coming up really quickly.

 

[Bet TSLA]

Elon recently replied to someone asking about investing a pool of money:

I don't know if that is the same group of potential investors or not, but it doesn't sound like there is a funding round coming up really quickly.

No, not the same guy, but possibly a large overlap in people looking for a way to invest. But without going a bit further, there's no way to tell much. Anybody can be anything on social media.

 

[Cosmacelf]

but it doesn't sound like there is a funding round coming up really quickly.

Right. The usual way these investment pools work is that they cast around looking for an existing large SpaceX shareholder that wants to sell. Someone who wants to sell $20M worth or more. The pool will set up an escrow account, gather all the buyer $$ together, and then exchange the $$ to the seller for the shares.

Needless to say this takes time as anyone who has raised private equity financing knows. It can take months and a lot of threats/calls/missed deadlines to gather all the buyer money together. I was part of such a buyer pool about five months ago. I had wired my money to the escrow account. But they couldn't get the whole $20M funded in time and then SpaceX stepped in and announced another raise at a higher stock price, meaning the seller didn't want to sell anymore at the previously agreed at price. Meaning the fund had to start all over again with new pricing, etc.

These pools generally DO NOT get to buy fresh stock directly from SpaceX. SpaceX has hard limits to the number of shareholders they are allowed to have, so when they raise new $$, they generally go back to existing institutional shareholders first and/or really, really large new buyers (like $500M). This is why when you buy into a pool, you don't own SpaceX shares. You own an interest in the pool, who then owns the shares.

Needless to say, you have to trust the pool owner to be honest. It would be really easy for them to take off with the money leaving you with nothing.

On the flip side, the pool owner has to do a lot of due diligence with his investors. It is ILLEGAL for him to accept money from non accredited investors. I believe it is a federal crime. That alone would stop me dead in my tracks if I wanted to do what this guy Brad wants to do. Yes, there are ways to protect yourself, but gosh, if you don't do it for a living and you screw up by not dotting that i, federal security investigators don't give a damn that you tried to "do the right thing". And then you have the constant threat of one of your investors suing you for some reason or other. When millions of dollars are at stake, some people take a dim view of poor execution.

I could go on, but you get the idea.

 

[EVCollies]

Right. The usual way these investment pools work is that they cast around looking for an existing large SpaceX shareholder that wants to sell. Someone who wants to sell $20M worth or more. The pool will set up an escrow account, gather all the buyer $$ together, and then exchange the $$ to the seller for the shares.

Needless to say this takes time as anyone who has raised private equity financing knows. It can take months and a lot of threats/calls/missed deadlines to gather all the buyer money together. I was part of such a buyer pool about five months ago. I had wired my money to the escrow account. But they couldn't get the whole $20M funded in time and then SpaceX stepped in and announced another raise at a higher stock price, meaning the seller didn't want to sell anymore at the previously agreed at price. Meaning the fund had to start all over again with new pricing, etc.

These pools generally DO NOT get to buy fresh stock directly from SpaceX. SpaceX has hard limits to the number of shareholders they are allowed to have, so when they raise new $$, they generally go back to existing institutional shareholders first and/or really, really large new buyers (like $500M). This is why when you buy into a pool, you don't own SpaceX shares. You own an interest in the pool, who then owns the shares.

Needless to say, you have to trust the pool owner to be honest. It would be really easy for them to take off with the money leaving you with nothing.

On the flip side, the pool owner has to do a lot of due diligence with his investors. It is ILLEGAL for him to accept money from non accredited investors. I believe it is a federal crime. That alone would stop me dead in my tracks if I wanted to do what this guy Brad wants to do. Yes, there are ways to protect yourself, but gosh, if you don't do it for a living and you screw up by not dotting that i, federal security investigators don't give a damn that you tried to "do the right thing". And then you have the constant threat of one of your investors suing you for some reason or other. When millions of dollars are at stake, some people take a dim view of poor execution.

I could go on, but you get the idea.

Great points, I passed on a similar deal a few months ago. Could have been a great deal but I've learned, investing at this level means you are the last to be paid out when things go right and the first to be squeezed out if something goes wrong.

 

[Cosmacelf]

Great points, I passed on a similar deal a few months ago. Could have been a great deal but I've learned, investing at this level means you are the last to be paid out when things go right and the first to be squeezed out if something goes wrong.

Right. You get very spoiled owning public company stock. You can always sell your stock, you always get quarterly financial results, etc. Private company stock is like buying a house. You've got to expect to hold it for five years or so. And then it'll be a pain in the butt trying to sell it. And then the transaction costs eat up some of the profit (if there is any).

Owning SpaceX shares in a pool is even worse. Now you are at the mercy of the pool owner and the dense legal document that structures the pool (you read that dense legal doc, right?).

For these and other reasons, I came to my senses and I'm no longer looking to buy SpaceX shares. I still love the company and wish I could have bought shares directly from the company, but I don't think that was ever even a possibility (I suspect only Elon's friends and institutions were allowed to buy SpaceX shares directly even early on, and for the past ten years, forget it!).

It's OK, there are lots of interesting opportunities elsewhere.

 

[Boomer19]

the guy recently tweeted
https://twitter.com/bradsferguson/status/1315667876871843841?s=21

regarding doing it directly with spacex and not a share plan provider

however, it would appear to me the same thing applies that cosmacelf stated prior


i was debating jumping in on a recent round (friend of a friend, more a favor to my friend for letting me in bc my investment amount wasn’t large)
my friend entry into valuation around 38bb

the one i was looking at was ~43bb a month later

done through a custodian (share plan provider) comprised of probably spacex employee and existing investors (like forge global or sharespost)
a) as those holders trim positions that frees up new entries
b) newly issued shares for new round

but i didn’t get in anyway

assuming some here were in in the teens and 20s bb valuations a few years back. that’s nice!

 

[juanmedina]

Ron Baron was on CNBS today and he was talking about his investment in SpaceX saying that he thinks SpaceX will be as big as Tesla and he wants to be known as the SpaceX/Tesla guy

 

[Xepa777]

Ron Baron was on CNBS today and he was talking about his investment in SpaceX saying that he thinks SpaceX will be as big as Tesla and he wants to be known as the SpaceX/Tesla guy

2020 - 2030 will be Tesla's decade. 2030 - 2040 will be SpaceX's decade. I wouldn't be surprised if in 2040 these two companies (or the broken up components representing them to prevent monopoly) will add up to be the largest 2 companies in the world.

 

[Cosmacelf]

I like Ron Baron but you know he's just doing PR to get more investors for his fund. I wonder if he'll invest in Boring company when they next do a raise?

 

[e-FTW]

Thoughts on HyperGuap?
Announcing HyperGuap

 

[juanmedina]

Thoughts on HyperGuap?
Announcing HyperGuap

Someone said that his fee is 15%

 

[MP3Mike]

Someone said that his fee is 15%

I think it was 15% of the gains when you sell. They said normal private investments have a 20% fee on gains and in addition have carry costs, which HyperGuap doesn't have. (I have never done this so I don't know if that is true or not.)

 

[Cosmacelf]

Thoughts on HyperGuap?
Announcing HyperGuap

Caveat, I haven’t looked into the details of HyperGuap.

My understanding is that it is for accredited investors only (ie you must meet minimum asset levels and demonstrated investment sophistication).

Investing in private companies via funds isn’t new. People have been doing it for a long time. That’s what a VC fund is. Or Angel investment networks.

Private company investing is far riskier than public company investing. The odds of the company going bankrupt are far higher.

Expect your money to be sitting in the company for five years at a minimum. There are plenty of public companies where you can double your money every year with far less risk than a private company. So, are you pretty confident you can get a 32x return after five years from a private company? Is that even in the cards?

The fund manager is key. Are they worth 15% or 20% of profits? Do they have a track record and, more importantly, access to lucrative private company deal flow? Most new fund managers do not have access to the best private companies.

I like Gali, but I don’t think he has enough experience to be a good fund manager. Maybe his YouTube channel gives him access to interesting startups? Maybe, hard to say.

 

[Bet TSLA]

Thoughts on HyperGuap?
Announcing HyperGuap

Yeah, Gali is proving to be a barnacle. Not for me.

 

[Xepa777]

Caveat, I haven’t looked into the details of HyperGuap.

My understanding is that it is for accredited investors only (ie you must meet minimum asset levels and demonstrated investment sophistication).

Investing in private companies via funds isn’t new. People have been doing it for a long time. That’s what a VC fund is. Or Angel investment networks.

Private company investing is far riskier than public company investing. The odds of the company going bankrupt are far higher.

Expect your money to be sitting in the company for five years at a minimum. There are plenty of public companies where you can double your money every year with far less risk than a private company. So, are you pretty confident you can get a 32x return after five years from a private company? Is that even in the cards?

The fund manager is key. Are they worth 15% or 20% of profits? Do they have a track record and, more importantly, access to lucrative private company deal flow? Most new fund managers do not have access to the best private companies.

I like Gali, but I don’t think he has enough experience to be a good fund manager. Maybe his YouTube channel gives him access to interesting startups? Maybe, hard to say.

While Gali is not the more sophisticated investor in the world, I will say this...

1) What's the downside to signing up for the platform (free) and evaluating the deals to make your own independent decisions?

2) Looks like minimum investments are small ($5k) much better than comparable places like Microventures that annihilate you on fees.

3) If he brings a deep tech startup yah I'd question, but if there's a B2C startup that can grow a following that leverages the Hyperchange audience, I can see why a high quality startup would give allocation to Gali and why Gali's network could make a meaningful impact.

In full disclosure, I co-founded a startup that went through Y-Combinator. Basically a large % of startups had hockey-stick curves because all the YC alumni startups used the products for the current batch on extreme discounts/free. The network matters lol. Fake it to ya make it! And you can certainly put a $ figure to the Hyperchange audience of leveraged correctly.

 

[e-FTW]

I think Gali is young and can make mistakes. But his heart is in the right place on this one. I like the objective (get more folks access with lower barrier to entry). Remains to be seen if I trust him with my money.
He is visible and I don’t expect him to flee to Belize with the money at least.