SpaceX investor's thread

[Cosmacelf]

Wow and i thought my 0.1% Vanguard funds were high

If you paid 20% fee on capital gain (shudders), is that pre or post capital gain? i.e does it reduce your reportable gain to IRS at all?

Yes, it will reduce IRS reportable gains. A 20% carry is pretty common for venture funds and hedge funds, Btw.

 

[Johan]

Details deleted at request of commenter.

Thanks for the meat on the bones. On the one hand interesting way to invest, on the other hand I agree it sound like a like when you rent an apartment from a guy who is renting it from the owner (who's name you don't even know)... lot of things that could go wrong and possible ways to get shafted (if you're the paranoid kind).

 

[damocles11]

Thanks for the meat on the bones. On the one hand interesting way to invest, on the other hand I agree it sound like a like when you rent an apartment from a guy who is renting it from the owner (who's name you don't even know)... lot of things that could go wrong and possible ways to get shafted (if you're the paranoid kind).

That is an apt analogy. I have no idea who the SPV above me is that actually owns the shares that I indirectly own. Unfortunately it is not paranoia either, as I heard about another spacex microventures fund that was forced to liquidate recently because the actual owner decided to sell, which liquidated the funds below them. I am unclear on the details because they would not tell me, but have confirmed with microventures that this actually happened. They could give me zero assurances that this won't happen to the fund I invested in other than to say this is not the expectation. But I was/am desperate to get in SpaceX, so I am taking the risk with a smaller sized investment.

 

[MP3Mike]

It's the first 20% of gains, not the total.

So if there are only 20% gains you get no gains as they keep them all?

 

[Nocturnal]

So if there are only 20% gains you get no gains as they keep them all?

A little worse than that because you pay a 2% management fee as well. That said, I'm not potentially investing in SpaceX because I expect a 20% gain.

 

[Cosmacelf]

So if there are only 20% gains you get no gains as they keep them all?

Welcome to the world of private company investing. The public stock market is a deal in comparison. People seem to think that you have to go to pre-IPO companies to get 10x or more gains. This isn't true at all. Tesla is but just one example. And most private companies go bankrupt.

Speaking just from my own experience of investing in about 10 private companies over the years, my public stock market income and gains have far outstripped my private company investment losses. The only private company I truly made money on was the one I founded and ran myself.

 

[Do It]

A little worse than that because you pay a 2% management fee as well. That said, I'm not potentially investing in SpaceX because I expect a 20% gain.

According to "SpaceX leaked internal doc" starlink alone is projected to be 30B revenue with 60% gross margin by 2025. That can easily justify a market cap of 200-400B. Current valuation is around 46B.

 

[Nocturnal]

According to "SpaceX leaked internal doc" starlink alone is projected to be 30B revenue with 60% gross margin by 2025. That can easily justify a market cap of 200-400B. Current valuation is around 46B.

I feel like worst case the Starlink IPO would make my investment back. Time isn’t an issue thanks to a steady job and solid TSLA gains.

The TAM for Starlink is massive. Even in the US, consumers hate legacy ISPs. Plus add mobile homes, boats, semis, busses, etc. It will eat into mobile phone data business too I expect. Plus whatever the NSA pays to have back door access.

Globally the sky is the limit.

 

[bxr140]

According to "SpaceX leaked internal doc" starlink alone is projected to be 30B revenue with 60% gross margin by 2025. That can easily justify a market cap of 200-400B. Current valuation is around 46B.

Certainly that number is optimistic, but just for round maths ~30B annual revenue is the equivalent of ~25M residential subscribers. Even the most bullish would agree 25M residential subscriptions globally is pretty much a non-starter--certainly by 2025--and the 5G juggernaut (to say nothing of the potential havoc an undercutting Kuiper could wreak) is going to make that even more difficult as time goes on...so any hope of hitting that 30B rides on services beyond residential: commercial and government.

Of course, it’s also hard to imagine The Man acting quickly on Starlink with any significant quantity of zeros, so IMHO commercial services are really going to be the meat and potatoes of near term Starlink revenue. To that end, air travel could be a big initial hit, with non-pandemic number getting close to ~5B people flying every year (~1B in the US). Overland and sea travel (like cruises) might play a small part, but only ~30M people globally take cruises every year so the volume might not be there. Similarly, low-latency commercial demand (trading) will also serve a niche market but again will not be a huge part of the revenue stream.

Beyond those generally ~new service spaces IMHO what we're really talking about here is Starlink competing with existing FSS services. This report, while a little old, gives a good idea of where the industry is right now-ish, and one could imagine Starlink potentially being competitive almost across the board of the reported 126B annual revenue from satellite services. This makes a lot of sense, and is actually the area Telesat has been targeting for their core revenue for a while--they realize there's not actually overwhelming opportunity on the residential side beyond those who already are satellite subscribers. The downside, of course, is that existing FSS services are very well served by GEOs, so its not going to be an across the board slam dunk for Starlink but rather a targeted competition.

 

[Do It]

(to say nothing of the potential havoc an undercutting Kuiper could wreak)

One thing I learned from following tsla and spaceX in the last few years is that there is no one even close to the speed Elon moves. Blue Origin is about 10 years behind SpaceX now and will be even more in 2025. I don't think Kuiper would be close to being competitive (if it ever gets there.)

 

[bxr140]

I don't think Kuiper would be close to being competitive (if it ever gets there.)

That’s probably fair for 2025, and also certainly fair to question whether Kuiper will actually become a thing. But...if they do, the issue Starlink will face is the same issue online retail faces with Amazon, where slim margins and undercutting are business as usual.

Starlink’s discriminator will indeed likely always be superior technology, but the average person/company doesn’t want superior technology, they want sufficient technology at the lowest price.

 

[pyy1]

Details deleted at request of commenter

I have been looking into the recent Sharespost SpaceX investment opportunity. I heard that the minimum investment amount is $250k, 2% annual management fee (not sure there is a cap or not), plus 20% fee on profit, in additional to some setup fees. I have not received the final investment term document yet.

 

[Do It]

It's the first 20% of gains, not the total. I also believe it's 2% of the original investment, not as it grows but I'm waiting on the actual docs.

I heard that SharePost manager has the discretion to either distribute cash or shares at the end - if it is cash I interpret that as cash at the IPO price. When you take risk and pay fees to invest in pre-IPO you want to not only reap the reward of IPO but also subsequent price jump post IPO so the term kind of defeats the purpose - it is like tail you lose and head they win.

I really want to get in but not with this kind of ridiculous term. People in tsla forum can easily raise 25-100M so maybe we should seriously looking into forming our own LLC. If we can get people to signup 50M, 5% initial management fee would be 2.5M and I believe that should be enough to cover legal and financial documentation fees and hiring a full time person to handle other administrative matters.

 

[EnzoXYZ]

I heard that SharePost manager has the discretion to either distribute cash or shares at the end - if it is cash I interpret that as cash at the IPO price. When you take risk and pay fees to invest in pre-IPO you want to not only reap the reward of IPO but also subsequent price jump post IPO so the term kind of defeats the purpose - it is like tail you lose and head they win.

I really want to get in but not with this kind of ridiculous term. People in tsla forum can easily raise 25-100M so maybe we should seriously looking into forming our own LLC. If we can get people to signup 50M, 5% initial management fee would be 2.5M and I believe that should be enough to cover legal and financial documentation fees and hiring a full time person to handle other administrative matters.

This is still the goal of a new SPV with us friends here. Minimum will be 50M with least amount of people to get there. Was able to have a conversation and now just patiently waiting.
Stay tone.

 

[AWDtsla]

Well the deal through SharesPost is probably off for me. The fund is asking that only qualified purchasers be allowed to buy, which means 5 million in equities (not even just net worth).

I've never heard that definition. So if you have 5 million in bonds and cash that doesn't qualify? Doesn't seem to match the SEC's definition.

 

[Cosmacelf]

I've never heard that definition. So if you have 5 million in bonds and cash that doesn't qualify? Doesn't seem to match the SEC's definition.

Sharespost can use whatever definition they want. In the end, what they are doing is protecting themselves from lawsuits.

 

[LudicrousMeme]

I called Sharespost yesterday and they told me that the document will be ready in 2-3 days.

Wow - are you saying Sharespost has SpaceX shares? I'm a Sharespost investor (both accredited investor and qualified purchaser). I've been begging them for months and they say they haven't had any shares. How did you get this opportunity?

I would sell my children for some SpaceX shares, except that I don't have any children. I'd be curious for any info you can share!

 

[Nocturnal]

Wow - are you saying Sharespost has SpaceX shares? I'm a Sharespost investor (both accredited investor and qualified purchaser). I've been begging them for months and they say they haven't had any shares. How did you get this opportunity?

I would sell my children for some SpaceX shares, except that I don't have any children. I'd be curious for any info you can share!

I'm not sure if they show them on the site. I can share a contact with the guy I'm working with if you like. Drop me a DM. The current fund is just about full though FYI.

 

[damocles11]

After seeing two of you guys say you are in discussions with sharespost on a spacex investment, I sent them a message the other day on their site asking about it. They have not responded and I think they are ignoring me. This tells me the securities specialist they assigned to me doesn't know anything about the offering and or is just providing terrible customer service. Neither of which is giving me confidence to invest with them. As it is my funds are heavily tied into tesla the next couple months so unlikely I could do a deal this week anyway if given the chance.

 

[Nocturnal]

After seeing two of you guys say you are in discussions with sharespost on a spacex investment, I sent them a message the other day on their site asking about it. They have not responded and I think they are ignoring me. This tells me the securities specialist they assigned to me doesn't know anything about the offering and or is just providing terrible customer service. Neither of which is giving me confidence to invest with them. As it is my funds are heavily tied into tesla the next couple months so unlikely I could do a deal this week anyway if given the chance.

I had that experience the first time I tried but was introduced to a different specialist from a forum member here. If you want to DM me your email address I'll send an email to introduce you so that you can take advantage next time. Sharespost is only the middle man so I don't worry too much about their service level. This guy is good though.