The SpaceX IPO on Friday lived up to the

hype and was one for the history books.

The stock was priced at $135 and closed

the day up 20% at 161. Currently a $2.1

trillion company. The last time Elon

Musk ran the bell at NASDAQ was in 2010

for Tesla. 16 years later, both Tesla

and SpaceX are now in the top 10 list of

the world's largest companies. We'll

watch Elon's speech at the event. This

IPO was three times the size of Saudi

Aramco's record-breaking debut in 2019.

Having said this, both OpenAI and

Anthropic are expected to have their

outings soon, and they'll both be likely

even bigger. Many big whales not only

bought prior to the IPO, but also bought

during the day. Early SpaceX investor

Gavin Baker of Atradus said that a month

ago, SpaceX did not have a cloud

computing business, but now it's the

fourth largest cloud ahead of Oracle.

Kathy Wood of Arch Invest bought $500

million worth on the open market and she

says they see Starling to now be a $1.6

trillion market. We'll watch both of

these interviews. Finally, Open Iimer

has initiated coverage on SpaceX stock

with an outperform and a $190 price

target. Options trading begins Tuesday.

We got Larry Goldberg here with us

today. He's a serial entrepreneur and

has been an active venture capital

investor for the last decade. Check out

his website, lumicanti.com.

Welcome, Larry.

Great to be here.

>> You must have been very very excited. Uh

I know how much you love SpaceX. You've

been an early investor in SpaceX and now

many of us many people are investors in

SpaceX at this point too. So this is

Elon at NA at the Starbase I think he

was. Um and I'm going to play a little

clip that NASDAQ shared about uh this

IPO. my tremendous honor and privilege

to welcome to NASDAQ the entire SpaceX

team in what stands as the largest

public offering in the history of

capital markets.

Today we make history again. Elon

founded this company to build rockets

and spaceships that will take humans to

Mars, the moon, and even beyond. And

that's what SpaceX is all about is to

take the fiction out of science fiction

and create an exciting, inspiring future

for everyone.

Okay. Well, we will do a show on Gwen

Shotwell. We'll publish that on Monday

morning. But, uh, Larry, what did you

think about this specific IPO that

happened on Friday?

>> Well, I had a great day.

Um it was uh it was everything I'd hoped

for and a little bit more besides. Look,

do you know that it's true that the

actual volume of shares, the number of

shares traded on a first day

>> um was actually

not SpaceX wasn't the winner of that

particular record because Facebook sold

580 million shares

>> versus 518 million change

uh that SpaceX sold. But the value of

the SpaceX stock sold on the day far

exceeded the value of any stock ever

sold anywhere on earth in a day. It was

by far the biggest record of a single

counter being sold in dollar terms uh in

the history of in the history of you

know public exchanges.

Um so there was a massive churn

where a lot of people a lot of

institutions particularly hedge funds

that had been granted shares uh sold

their shares and guess who bought

retail

and those enterprises that wanted the

stock for you know to put into the into

the bank as it were to put into the

vault.

So we have very strong holders now. Uh

we have a very strong market.

We're a very deep market, very broad

market. And the one thing I will say

that is quite remarkable

is the bankers did not design this IPO.

>> Mhm.

>> The company designed this IPO.

Elon

and his management team

made all the decisions.

They decided the pricing.

They decided the method

and they decided exactly who was going

to get what. And so that made this this

this offering

so different from anything that has gone

before it. And it was very successful.

So they design rockets and they design

IPOs.

>> Yeah. Anything that SpaceX does is going

to be bestin-class is what you're trying

to say because they have the

best-in-class team and they really think

through what it is that is best for the

company but also the best for the

shareholders. One of the questions I'm

going to ask you later is is this a good

investment and and why SpaceX? Um, there

was of course a lot of negative hatred

for Elon Musk becoming a so-called

trillionaire. A lot of hatred for SpaceX

as in as in like how's this company so

successful when it's it's silly. It's

like a decades away. It's a scam. We'll

we'll talk about that because hey, when

it comes to the stock, I was telling my

family, my wife, that that's fair. Let's

talk about it. You can have an opinion.

Maybe it is a dumb investment. I don't

know. Let's talk about why you think

that's way. But it comes to like you

know hatred for Elon or trillionaire.

Let's that part there. Let's discuss

that a little bit because I need to

understand your thinking there. Here's

Elon and let's listen to what he

actually said at the day of the uh IPO.

>> The aerospace companies they build good

rockets and everything. They they were

simply not pursuing the technology

that's necessary to make life

multilanetary.

uh to

to to make to make Star Trek to make uh

the the exciting science fiction futures

that we've read about real. And that's

what SpaceX is all about. It's to take

the fiction out of science fiction

and create an exciting, inspiring future

for everyone. We want to be able to take

anyone who wants to go to the moon,

anyone who wants to go to Mars or

anywhere in the solar system and maybe

beyond the solar system at some point.

We want to be able to take you there. Uh

not not just not just a few astronauts.

I mean you literally you uh if you watch

whoever you are watching this, SpaceX

wants to be able to take you to the

moon, take you to to Mars, uh and and

ultimately beyond. And um and and I I'm

confident at this point that with the

incredible team that we have here at

SpaceX that we will do that for you.

4,000 of SpaceX employees apparently

have become millionaires or

multi-millionaires, including these

stories we're hearing about welders or

bluecollar workers. It it is it is

fantastic because this company gave

stock options to every employee and uh

they they are the ones that made so much

money. Um thoughts on uh what he said?

>> Well, you know, you have to you have to

have been with this company

over the 20 years of its existence to

understand the challenges that they've

actually met

and vested.

You have to listen to the derision

and the cat calls from the bleachers

about the company's plans as it rolled

them out. You have to have listened to

Boeing

telling Congress that the SpaceX should

never be allowed to sell rockets to

NASA.

yet to have listened to congressional

critics lambbased Elon in front of the

congressional committees and on

television

about how badly he runs the company and

how he'll never get rockets into space

and how his rockets blow up. You'd have

to have lived through the tough times,

you know, particularly when they did

have explosions on the ground. you know,

Blue is going Blue Origin's going

through that, right? And they'll they'll

>> they'll they'll conquer that problem.

Um, but but you had to have lived

through it to understand just how these

people feel today.

And you know, it it's so tragic that we

have produced such an incredible

company,

such an extraordinary team. To hear the

pe to hear people making these

uninformed comments, these uninformed

criticisms, it is so disheartening. I

grew up in an age where we really looked

to the skies and thought, you know,

maybe man is going to get up into space.

And you know, I I I reached maturity

when we launched our first man to the

moon. I I mean I remember listening to

Sputnik,

>> family and I sitting around the table

listening to Sputnik going overhead and

thinking about, you know, how America

was going to lose the the the race to to

to the stars to Russia.

So it just boggles my mind that people

can be so destructive, self-destructive.

>> Yeah. to society and to the own country

um to talk about such a national

treasure in such der to derise of terms.

>> Yeah, this is uh there's so much at

stake, isn't it? And uh aren't you glad

that it's United States and we're not

just talking about, you know, rockets

into space. We're talking about

intelligence, energy, everything that

matters for who's going to be the

superpower. Um, and it's an American

company. So, this is Elon Musk in 2010

when he uh celebrated the IPO of Tesla.

It was actually June of 2010. Exactly 16

years later, here he is. SpaceX IPO, but

SpaceX was actually born ahead of Tesla.

Uh, but of course, for various reasons,

decided not to go IPO quite yet.

>> Yeah, this was the Tesla IPO 2010, which

was really the pattern for Elon. He

would run the company and build

absolutely needed public com public

capital and then he would take it uh

public and this is the second time he's

done that and it's the second time he's

a great success he had great success in

2010 I remember it very vividly

uh and you know he was criticized

roundly at that time as well

nothing nothing like criticism he's

getting today but he still got plenty of

criticism

And you know they had a they had a great

they had a great uh introduction to the

um to the public markets at that time

and and you know it's gone

it's gone uphill but with you know great

courage ever since.

>> Today Tesla is now the 10th largest

company in the world being valued at

1.46 46 trillion and after the IPO on

Friday, it is now SpaceX is now worth

$2.1 trillion. It is number seven

already

uh pretty quickly. It just jumps right

up there along with the top 10. So Elon

owns two of the most important companies

on earth. Uh and this is the the 15

largest offer sizes including all

markets. And so $86 billion because it

was 75 but then I think they had the um

blue shoe or uh green shoe green shoe

the ability to uh add another um aotment

if they start the price went up so well

and it did and so they actually I think

raised 86 million x86 billion I'm sorry$

860

>> what what am I saying here

>> 86 billion

>> 86 billion is how much they raised which

is three times almost larger than Saudi

Aramco which was at the time the

largest. I I think this is just

temporary. I think when uh open the

ironic come out uh rumors are they're

going to each raise hundred billion

dollar. So but it still is the current

today. So why why the frenzy is it so

huge? Let's listen to Gavin Baker of a

treatise what he thinks and why he says

it's such an important uh day. I think

we need to take a step back and a month

ago SpaceX did not have a cloud

computing business. Now by some measures

it is the fourth largest cloud ahead of

Oracle and they did that in one month.

Let's let's see what they do in a year.

The uh the owners of landed power are

heavily incented to give it to people

who can energize it first. the seller of

GPUs i.e. Jensen likes to give them to

people who are going to use them. So I

think a really important variable for

SpaceX is how many gigawatts can they

bring on over the next few years because

they are monetizing these gigawatts of

terrestrial compute at a very high rate.

Then when when do we are we re reusing

Starship such that we can put Starlink

V3 satellites up into space enable

direct to sell and then orbital compute

soon after. Uh so I think I think there

is a there's a path here as a as a

public company um with a series of

events and milestones that investors can

use to track the company's progress.

Larry, to what extent do you think that

the public realizes that SpaceX is more

of an AI company than it is anything

else actually and that there is so much

more money to be made in terrestrial

data centers before waiting for uh you

know space-based orbital data centers

and I think that's what Gavin was trying

to say in one month they're now the

fourth largest cloud offering ahead of

Oracle. Imagine when they make

announcements even more in the next

coming uh months.

Well, Gavin is one of the I think

probably the leading

um investor in this space and probably

understands

um data centers better than any other

investor in the world. And uh he

certainly chosen the winner. Actually, I

don't know if you noticed it, but in

those floor shots at SpaceX during the

uh during the ringing of the NASDAQ

bell, Gavin was standing in the audience

amongst the employees.

>> Um yeah, and you know, it um it's very

interesting to hear him say it and I

think it's correct. I think that we

don't understand that um it will not be

very long before Tesla uh SpaceX will be

considered the largest terrestrial

supplier of AI compute in the world. I

think they're going to surpass

Amazon and Microsoft and Google uh in

the very near future particularly uh you

know and the reality is that Nvidia

wants to put put chips in the hands of

people who can put them to work as soon

as possible. The last thing Nvidia wants

to do is put chips in a factory that

doesn't work. That is counter to their

mission.

And they know that if they give a chip

to Elon and by the way the very first AI

GPU was ever delivered to Elon by hand

by Jensen.

So, it's almost certain that uh you know

they'll get the chips they need at the

speed they need them

whether or not they'll choose to put

them into the hand put them on on on

rent to um to the Frontier um

um models Frontier model vendors

is an interesting question and it

depends upon how rapidly they scale

their own Grock/Curser

business. It's obvious to me that

they're going to consumate this deal

with Cursor.

>> It's obvious to me that cursor and Brock

are going to meld uh and become a single

product. It's obvious to me that they're

focusing

on the upcoming Vera Rubin uh release.

Um so I I think they have a very clear

plan in mind. Um, but I think they're

going to rent as much compute as they

feel they don't need on conditions that,

you know, they can rent them back should

they need to. So, they're in the pound

seats. They're in the pound seats

because they're the best engineers on

Earth as far as data centers are

concerned. That's what Gavin tells me

and I have to believe him. And and

they're the best at what they do. And so

people are going to rent from them

because they know that they're going to

get the kind of compute they need to

support their systems.

And so I think we're going to see,

you know, the growth of that business

very rapid. And that's very good because

it'll be it'll inform

advance the data center in the sky.

>> Yeah. One of the strategies that's

becoming much more clearer now is that

Tesla builds the data center, they use

it themselves, then they build a second

data center with better chips, they use

that for themselves, and then they rent

out the old ones, and then they move on.

Uh, so there was uh

>> that's not entirely that's not entirely

correct. Remember, their deal with

Google is for the Vera Ruben chips,

>> which is Colossus 2. Yeah. the the

latest ones. Um I think the the latest

news was that Colossus one was supposed

to be used by Tesla, but apparently the

latency wasn't quite as good. Apparently

that that was val uh collaborated

corroborated that it's a true story and

then they then moved to Colossus 2. So

then that's why they were able to rent

out Colossus one to anthropic. But yes

uh and I think we'll we're going to do a

show tomorrow with Gwen Shaw and she

said that

>> you know we will res we will use the spa

the compute that we need when we need it

we will use it as our we will always be

first priority and then maybe rent it

out if we don't need it but we will

always use it first and so I think that

that what your point is true which is

people are now going oh my god look how

much money they're making from renting

they're going to be a cloud computing

company no they are going to be the

leader AI leading AI out there in due

time

>> and it just so happens.

>> Yeah.

>> Don't underestimate the cloud computing

business. The cloud computing business

is incredibly capital efficient.

Incredibly capital efficient. And so

don't underestimate it. Don't think that

they're just going to take up all the

they are going to be a cloud compute

company and only and look at the design

of their satellite

their their um cloud.

>> Yeah. the Yeah. Any chip. They were very

clear about that.

>> Yeah.

>> So,

you know, they're going to make money

coming and they're going to make money

going. They're going to make money on on

the on renting the their engineering

skills because the engineering skills

are better,

>> they're cheaper, and they're faster.

>> Yeah. Google wants to use their TPUs. Go

ahead and use that. You want to use any

of your own, go ahead and use that.

We're going to rent it to you

>> and we're not going to just uh restrict

it to just our chips or whatever. Okay.

Arc Invest very interesting what she

did. Kathy Wood uh she went and started

buying Tesla share SpaceX shares on the

day of on the open market. I mean I'm

sure she had access to the pre-allotment

uh but she bought 3.3 million shares

which is close to $500 million worth of

SpaceX on the day of debut. So, she's

obviously adding up across her four

funds. She needed to have more exposure

to SpaceX and so she bought. Okay. They

did sell some other names of course to

make room for them. And uh this is all

the things she did on that day of June

12th. Um

>> well, she was she's been very restricted

restricted in buying SpaceX shares

because it's a it was a private company.

>> Mhm.

>> But now it's a public company. she can

unleash, you know, the Kraken. She can

actually go to her funds and buy with

cash. So very important and and she has

a lot of restricted stock from you know

in various of her funds which she bought

uh you know before the IPO.

>> 500 million. That's a that's a big bet.

That's a decent size bet for a firm. Um,

so the reason, one of the reason

Vanguard bought

>> how much? 5 billion.

>> I don't know.

>> I think it was Black Rockck that's

already announced that they wanted 5

billion worth.

>> They put in an order for 5 billion, but

nobody's talking about what Vanguard

Vanguard didn't announce.

>> I see.

Yeah. Um, did you hear that story about

the Yeah. But you know that they that

the volume of stock yesterday in that

was sold volume of SpaceX stock that was

traded is equal to the entire number of

shares that the company floated.

>> Yeah. The demand is there.

>> In other words, a hell of a lot of the

institutions that bought also sold.

>> Oh, I see. Yeah. Uh well, I mean there's

the stories about the Ontario pension

teachers pension fund that they invested

years ago and now they're like

multibillion dollars and tremendous

growth. And I'm sure that they they

should have sold on the day of IPO

because they've been holding for so

long.

>> Well, that's only 16 billion. That's

only 16 billion, but I think there's

their stock is locked up.

>> Yeah. Okay. So, uh Kathy would explain.

So, one of the biggest misunderstandings

that people have, especially the star

SpaceX investors, is Starlink is

thinking that, yeah, it's a good

business and they've got 10 million

customers and it's going to grow, but

it's not this massive business. Well,

Kathy Wood came out and she is trying to

explain that one of the things that she

figured out was that um because SpaceX

started building their own phased array

antennas, they will crush the cost curve

and that will unlock markets. And now

the Starlink opportunity used she used

to size it at 34 billion but SpaceX puts

the total address of market at 1.6

trillion. Like that's a multi-magnitude

difference in market size. And she says

this is why like you're not you haven't

seen anything yet. Let's listen.

>> Started modeling out Starlink 5 years

ago or whenever it was. We sized the

opportunity originally, I think, at $34

billion, right? Because we were

interpreting the market, okay, this will

be for rural areas or over the water or

what have you. Now, SpaceX thinks that

this TAM is $1.6

trillion. And it's because it's not just

that. It is really all of

telecommunications and all of the

internet. And it absolutely is possible.

But we weren't thinking that way.

Probably because we were constrained by

what we thought was the possibility of

hardware. Not, you know, we just weren't

thinking in that way.

>> Yeah.

>> Until Elon showed the way.

>> Well, and and it really does depend upon

at that time a phase array antenna or

the best in the a phase array antenna

that could work cost like $27,000 or

something in that I think it was 27,000.

So kind of the investing in all of the

friction points that allow you to get to

scale. So they built their own phase

array antennas. They you know that

allows for cost to decline which then

opens up both markets you can model and

unexpected market.

>> Isn't that I love this. I love this so

much because it just it's the same thing

you're hearing about Tesla's robo taxi.

People think it's a ride market. Here's

the you know Uber. No, this is

transportation service and here's what

they're shooting for. Here's what's

going to change. You are not

understanding the cost curve, the the

the infrastructure they're building,

everything is so different than just

replicating a Uber.

>> Nobody gets it.

>> You know, they don't they're not getting

it. Even today, even today when he's

done it again and again and again, they

write these incredibly silly,

you know, scientific

uh

papers about why this is impossible. I

mean, I remember this conversation about

the phaser antenna at ARC. I remember it

very well. Um and you know I thought to

myself even

even our don't understand the power

of you know the the cost reduction

possibility. Listen I've got two

Starlink.

>> Yes.

>> I've got a Star Mini and I've got a the

Star big big dish and I live in an urban

area with excellent excellent

communications.

But I had these two for each for a very

good reason and each make a big

difference to my life and to my

business. So the the you know people

just don't they just don't understand

it. And if you go to Bastrop, Texas,

which is just outside Austin, I don't

know if I've

>> spoken on your on your channel about

this before,

>> and you see the size of the terminal

factory, the factory that manufactured

these phaser array terminals at Bastrom.

>> It's incredible. I mean, the first time

I thought, I thought, oh my god, this

factory is so huge. It turned out they

doubled the size the next year.

And now that gigantic factory, that

miracle of modern manufacturing, you go

in, they could switch all the lights

off. There are no people walking around

there. There's raw material going in one

end, phase array antennas coming out the

other end. This gigantic factory is

going to end up being the smallest of

four factories they're putting at

Bassroom.

Some of them three times the size of

this gigantic.

>> Yeah. in order to manufacture the the

data satellites. So, it's just it's an

incredible

machine. This machine that defines the

future and then drives cost down so that

they can create this future.

>> SpaceX is Starlink is going to be the

internet. It's going to replace every

internet. Why? Well, first of all, it

makes sense to go straight to the sky.

But two, uh, the cost. Imagine when

somebody gives you equivalent, you know,

to what you're getting with Xfinity, but

then half the price or even better. What

would you do?

>> Well, it's going to be difficult in, you

know, very dense areas. They're going to

have to partner in very very dense areas

in in most centers, city centers,

>> but but they will find that those

partnerships and they will engineer

those partnerships.

>> Okay. Open has initiated coverage on

SpaceX uh outperform $190 price target

which would make it a 2.5 trillion. We

see SpaceX to leverage terrestrial

compute expertise as a bridge possibly

backup plan to enables key scale and

cost advantage. And again everybody

keeps saying SpaceX is a 5year 10year

kind of thing. Well you've got Starlink

existing that's growing and then you've

got terrestrial compute that is uh that

they're really fast and building and

trying to catch up. We believe SpaceX

will use its expertise in engineering,

manufacturing, space technologies to

grow to the largest communications cloud

AI company in the world in our scenario.

Very large TAM with high barriers to

entry. That's the other thing, isn't it?

Uh, Larry, that SpaceX kind of um is the

only company that can do this at this

point. Maybe China, maybe Blue Origin,

but it's a handful of companies that can

compete in this wide open space. And so

that this is really truly a moat.

You say China. Do you know that China

still hasn't performed one return of a

booster

to planet Earth yet?

That the only other company that's

returned a booster to planet Earth is

Blue Origin. They're 9 years behind

SpaceX. M

>> and people are talking as if you know

all of this is a is a given that all

these other companies are going to

compete and Tesla is now competing with

a rocket that's five six times the size

actually it's 10 times the size now and

and is designed to be 100% reusable

and it it's so hard to put into simple

terms that people can understand just

how far they they lead the market. And

it's not as if they're standing still.

They're still driving at the speed that

that boggles people's minds. I mean,

people talk about they're exploding

rockets. Well, the reason they're

exploding rockets because they want to

wait five years

to find out what's wrong with the

rocket. Look at Blue Origin.

>> Yeah.

>> 10 years behind Tesla.

>> Uh I mean SpaceX. 10 years behind SpaceX

and they're the ones that supposed to

have been, you know, to go slowly so

that they can fiercely achieve these

goals. Yeah. They blew up their rocket.

>> Yeah. It's hard.

>> It's very, very hard. And the only way

you get there is to actually push the

frontier. Push the frontier.

>> Yeah. Okay. So SpaceX um options uh just

to round out the story will come online

it looks like on Tuesday so people can

>> oh it's going to be such a blood bath.

It is going to be such a blood.

>> I mean people are going to go crazy and

you know this is like the old Tesla days

around about the time of the inclusion

into the S&P. People are going to lose a

lot of money.

>> Yeah, there's no doubt it's going to be

very volatile. So this show is not

financial advice. Neither of us are

saying buy SpaceX. Please don't. People

come away going nervous pushing SP. I'm

not. I'm just reporting news. Uh

long-term investors, you can believe in

the long-term SpaceX, but there's a lot

more shorter potential that you should

look at Starlink and terrestrial based

data centers. What I'm I'm suggesting

and then make up your mind if you want

to invest or not what your time horizon

is. Well, all I'm trying to say, all I'm

trying to say is that the volatility

right now is going to be extreme and

buying

>> buying futures buying options,

>> yeah,

>> can be so dangerous when volatility

reaches these levels. I would I would

just warn everybody, you know, don't

burn your fingers. Keep your fing keep

your fingers in their gloves. Don't burn

your fingers.

>> Thank you so much, Larry. Follow him on

his website at lumisanti.com.

Thanks everybody.