Video about SpaceX
Important disclosure
*The implied valuation of the deal is a preliminary estimate, as it is based on the current market price of the offer. We will inform investors if there are any changes to the terms of the deal.
Quick Overview
Website
Product
Reusable rockets, spacecrafts, transportation and satellite Internet
Total funds raised
$10B
Last round
Jan 2023. Valuation $137B
Famous investors
Fidelity Ventures, Google, NASA, Bank of America
Why Invest in SpaceX
Second-most valuable private company in the world, behind only China’s ByteDance.
Wide range of breakthrough projects – SpaceX carries NASA astronauts to the ISS, takes people for joyrides into space, and delivers communications satellites into orbit. Eventually, it wants to transport people to Mars.
A series of firsts in its industry – the first to launch, orbit, recover, and reuse the same rocket, the first to ferry passengers into space, and the first to reach a valuation of $100B while still a private company.
Huge growth potential in aerospace and communications. Morgan Stanley survey revealed that institutional investors and industry experts expect SpaceX to become more valuable than Tesla. For reference, Tesla has managed to soar to a $1T market cap in 2021.
Starship and Starlink projects met with early success. Starlink presents a substantial opportunity in the coming years. To date, Starlink has launched 3,600 satellites into orbit. The system is now active on all continents, having reached over 1,000,000 active users. At around $100 a month, Starlink is generating $2.4B in annual recurring revenue. The company plans to reach 100 million users in the next 5–10 years. With $1,200 in annual sales per user, Starlink could generate $120B in sales for SpaceX.
Elon Musk has proven to be adept at raising capital for his many ventures. As of January 2023, SpaceX has raised a total of $10B, according to Crunchbase. Investment in this area has grown top-heavy in recent years, with only a handful of companies drawing in the lion’s share of funding. Fortunately, SpaceX has been among them.
High market growth potential. SpaceX is operating in a number of large and growing markets. Among them are deep space exploration market (to reach $700B by 2030, Morgan Stanley Research), space launch services market (to reach $32B by 2027, Allied Research), satellite internet market (and $120B in annual revenue projected for Starlink).
SpaceX and Tesla are the most desirable places to work for engineering graduates, according to the recent survey.
Business Growth Phase
Product
SpaceX was founded in 2002 by Elon Musk to revolutionize space transportation offering reusable rockets with the ultimate goal of making life multiplanetary. The company designs, manufactures and launches the most up-to-date rockets and spacecrafts. It also aspires to become the leading and first satellite service provider delivering high-speed Internet to users from all around the world.
Starship is a massive, next-generation rocket to launch cargo and people on missions to the Moon and Mars. In May 2021, Starship prototype aced a high-altitude test flight from South Texas. Reaching orbit is the next step in testing the rocket, with SpaceX awaiting regulatory approval for its next launch. Starship is likely to be priced early around $150–250М per launch.
Started launching Starlink satellites in 2019, the company now has already more than 3,600 Starlink satellites in orbit, a constellation far larger than any other satellite system today. Musk is planning to launch a total of 42,000 satellites in the near future. The company has recently reported 400,000+ global subscribers, up from 250,000 in March 2022 and 150,000 in December 2021. Starlink also continues to expand its coverage globally with service now available in more than 30 countries.
Financials
The company's last reported revenue of $2B was in 2019, and the company does not disclose any financial information. In 2022 SpaceX completed 61 launches, and it is estimated that the company generates $60M per launch. That said, SpaceX generated $3.6B in the launch business.
In January 2023 SpaceX raised a $750M investment round at a $137B valuation, at a price of $77 per share. The company has raised a total of $10B. In October 2021 SpaceX held a secondary sale of existing shares at the valuation of $100.3B. It made it the second-most valuable private company in the world (behind China's ByteDance).
Investment Rounds
Investors and Their Most Famous Exits
NASA – Viasat, Northrop Grumman.
Baillie Gifford – Airbnb, NIO, Lyft, Slack, Ginkgo Bioworks.
Bank of America – Bill.com, Dropbox.
Fidelity – Spotify, Uber, Airbnb, Pinterest.
Google – Tesla, Zynga, JD.com, Baidu.
Founders Fund – Meta, Twilio, Oculus, Affirm, Upstart.
Risks Related to SpaceX
SpaceX is operating in a high-risk growing market. The company is burning a lot of cash while having high overall costs. Given the rising interest rates environment, SpaceX might experience problems in fundraising.
In some business segments SpaceX may be faced with intense competition. Its Starlink satellite network program competes with Amazon, who’s planning to launch its Kuiper network with more than 3,000 satellites; though it hasn’t yet revealed its production plans or launched any satellites yet.
Speaking of space exploration and Mars colonization, a lot of issues need to be solved – high levels of radiation, thin atmosphere, food and water production in space and others. However, whether or not Elon Musk is able to explore planets, SpaceX is in the best position to give it a shot.
Sources
“SpaceX expected to become more valuable than Tesla, Morgan Stanley survey finds”, CNBC, Oct 2020
“SpaceX passes 2,500 satellites launched for Starlink internet network”, Spaceflight Now, May 2022
“SpaceX Starlink internet: Costs, collision risks and how it works”, Space.com, Apr 2022
“Bank: Starlink worth $81bn”, Advanced Television, Dec 2021
“Start-Up Space. Update on investment in commercial space ventures 2022”, BryceTech (pdf)
“Elon Musk’s SpaceX hits $100 billion valuation after secondary share sale”, CNBC, Oct 2021
“Elon Musk's SpaceX now valued at $100 billion”, Space.com, Oct 2021
“SpaceX faces possible liquid oxygen shortage for rocket fuel amid pandemic”, Space.com, Aug 2021
“Elon Musk's SpaceX Is Now 100X a Unicorn Stock”, The Motley Fool, Oct 2021
“Is SpaceX Really Worth $74 Billion?”, Forbes, Apr 2021
Offering
Deal Structure
Dizraptor Fund 1015 LLC is formed for the purpose of acquiring Common shares of Space Exploration Technologies Corp. The interests in the fund are offered to accredited investors who after signing a subscription agreement become its members.
Dizraptor always seeks the optimal ownership structure for its investors. In certain cases, when direct ownership of shares is unavailable due to restrictions of a private company, Dizraptor fund will consider alternative ways of equity exposure, such as double or multiple-layer SPV partnerships or forward agreements. In this case, Dizraptor's investors will have indirect access to SpaceX. In the case of a second or multiple-layer SPV, investors will have partnership units in a fund that has access to SpaceX.
View SPV’s Documents
Limited Liability Company Agreement (pdf)
Confidential Private Placement Memorandum (pdf)
Subscription Agreement & Privacy Notice (pdf)
Investment Management Agreement (pdf)
Fees
Fee on management – 5%, paid on top of the investment amount.
Carried interest – 20% of net profit. Charged at the closing of investment, after the rest of the commissions are paid.