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A potential SpaceX IPO could create around 4,400 employee millionaires as the company's valuation continues to rise. Employee stock ownership and equity-based compensation are expected to drive significant wealth creation if the aerospace giant eventually goes public. Economists believe a successful listing could have a ripple effect on sectors such as housing and real estate. The IPO may also be more accessible to ordinary investors than many previous high-profile listings.
The IPO price is expected to be $135 per share. At that price, investors would value the entire company at about $1.77 trillion. At that price, even employees with relatively small stock holdings could see their stakes become worth more than $1 million.
More than 4,400 current and former employees are likely to become millionaires after the IPO, according to the NY Times. Around 400 employees could hold stock worth more than $100 million.
Andrew Benson, the CEO of Hill.com told NYT that in most IPOs, the biggest financial gains usually go to the company's founders and a small group of top executives. They are often the only people who become billionaires when a company goes public.
Usually, only 5 percent to 10 percent of IPO shares are set aside for retail investors, while the majority go to large institutions such as mutual funds, pension funds and investment firms. For the SpaceX IPO, however, as much as 30 percent of the shares could be reserved for retail investors.
For instance, an employee named Trevor Hise joined the company in 2011. At the time, SpaceX was much smaller and far from the global powerhouse it is today. As part of his compensation, he received more than 100,000 shares. If the IPO price is $135 per share, those shares would be worth at least $13.5 million.
Musk owns about 42 percent of SpaceX, which means he holds nearly half of the company. If SpaceX is valued at $1.77 trillion after its IPO, Musk's stake alone would be worth around $740 billion.
Also Read: SpaceX IPO Plans $75 Billion Raise as Starlink Profits Fund Costly AI Expansion
Unlike many companies that provide only cash salaries, SpaceX has historically rewarded employees with significant equity stakes. Workers receive ownership in the company alongside their pay. As the company's valuation surged over the years, those shares became highly valuable.
SpaceX's was valued at $800 billion last year, but that jumped to $1.25 trillion after it merged with Musk's artificial intelligence company, xAI, in February.
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