Wall Street is from Mars, Redditors are from Venus

The only fan club matching the excitement of Knicks diehards today? SpaceX investors.

Elon’s favorite child is officially going public tomorrow. And unlike most B2B IPOs, the fervor isn’t just coming from the venture capital firms and other institutional investors: The Reddit crowd is showing up and showing out.

Retail investors have submitted over $100 billion in orders ahead of the record-smashing debut, according to Bloomberg, and the Financial Times reports that orders are triple the number of shares available. That oversubscription could fuel a serious first-day pop.

The deets: The company is offering shares at a fixed price of $135 each, according to Bloomberg. If all goes well, the company would raise $75 billion, valuing the company at an eye-popping $1.8 trillion—making it the biggest IPO ever.

Retail investors are shooting for the stars

SpaceX may build rockets, but right now, it’s functioning more like a black hole for investor attention: It’s impossible to ignore, and powerful enough to pull capital away from nearly everything else.

The demand is so bananas that traders are limiting exposure to other semiconductor stocks and opting out of buying dips in tech. Why? To have cash for gobbling up shares of SpaceX as soon as the company lists tomorrow, of course.

SpaceX knows its audience, too. Unlike most IPOs, which only allocate between 5% and 10% of shares to retail, SpaceX is reportedly setting aside at least 20%. And that won’t even come close to satisfying demand.

“I’m a huge fan of small retail investors,” Musk wrote on X in 2020, when casually suggesting the company’s IPO. “Will make sure they get top priority.”

Betting on Elon himself

The vibe of the fanbase also makes this IPO unlike any other. Retail investors aren’t necessarily buying shares based on financial projections, analyst forecasts, or even its actual products. Traders are opting into Elon’s vision, and are betting on his ability to execute. It's worked before—retail investors own roughly 40% of Tesla, per BNP Paribas estimates.

“This valuation is really about Elon,” Hirtle Callaghan Chief Investment Officer Brad Conger told Bloomberg. “He’s a walking Rorschach test, where people project all their desires and fears.”

As for what that vision entails, well, it depends who you ask. Some traders see SpaceX as first and foremost a space company that launches rockets. To other investors, the company is really a play on AI. Either way, the company is currently unprofitable. And a debut at 90x last year’s revenue, in an especially volatile tech market, is freaking out some suits on Wall Street. But SpaceX fanatics are ignoring the haters and dreaming big. Hey, it worked for Knicks fans last night. —LB