If you think Elon Musk's massive $5 trillion move won't affect you, experts say you should reconsider. The world's richest man is about to reshape finance with SpaceX's initial public offering (IPO), potentially exposing millions of Australians to significant risk.
SpaceX's Record-Breaking IPO
SpaceX, the rocket and satellite company led by Musk, aims to raise approximately US$75 billion ($105.26 billion) in what would be the largest IPO ever, the company said in a regulatory filing on Wednesday. The offering values the company at US$1.765 trillion ($2.48 trillion). SpaceX plans to sell 555.6 million shares at an initial price of US$135 ($189.47) each. If the IPO proceeds as soon as June 12, it would shatter the previous record held by Saudi Aramco, which raised US$25.6 billion in 2019. The move could also make Musk humanity's first trillionaire.
However, this seismic event carries huge risks. Experts warn we are entering "dangerous, dangerous territory," as the potential concentration of wealth could impact 17 million Australians—essentially the entire super-holding population of the country.
What Are the Risks?
Every Australian with superannuation or exchange-traded funds (ETFs) could be affected. SpaceX, which lost US$5 billion last year, may soon be included in major index funds that underpin most super funds. Starlink, SpaceX's satellite internet provider, generates over 61% of company revenue with 10.3 million active subscribers globally. However, that revenue supports experimental AI and space ventures costing billions. Musk's grand vision involves creating AI data centres in space powered by solar energy, but the massive Starship rocket needed for this keeps suffering setbacks.
Impact on Australian Super Holders
SpaceX is not alone. This week, Anthropic made a secret $2.5 trillion IPO move, as Silicon Valley AI companies seek enormous sums for rapid expansion. SpaceX is expected to close above US$1.8 trillion on its first trading day. Between SpaceX and Anthropic, combined market cap on IPO day could exceed US$3.5 trillion. OpenAI is also planning to list. Concerns are growing that these AI giants are pouring money into a potential bubble.
If these listings proceed, hundreds of millions of investors worldwide will be exposed as index funds become heavily skewed toward risky AI companies. A recent rule change allows mega floats like SpaceX faster entry into benchmark indices. Previously, companies needed to meet strict profit hurdles and wait three months. Now, SpaceX could join the Russell 2000 within five days and Nasdaq indices within two weeks. The S&P Dow Jones is expected to announce similar rule changes on Monday.
The Australian Financial Review's Chanticleer reported that these changes mean "hundreds of trillions of dollars tracking indices through passive strategies... are going to be required to buy shares in companies such as SpaceX almost as soon as it lists." This includes tens of millions of Australians holding ETFs or superannuation accounts reliant on passive strategies.
Bank of America predicts that when SpaceX, Anthropic, and OpenAI list, about 48% of the S&P 500 could be weighted to just 13 AI-related companies—a concentration not seen since the railroad boom of the late 1800s. Anton Eser, global chief investment officer of Robeco, warned: "The concentration risk that exists in equity markets hasn’t been this great in 100 years. We are in dangerous, dangerous territory."
The SpaceX Story
SpaceX absorbed Musk's AI firm xAI in February, a year after xAI took over X (formerly Twitter). Analysts expect further consolidation in 2027, with a possible merger between SpaceX and Tesla, which is increasingly focused on robotics, energy, and autonomous transport. The two companies are jointly developing a giant semiconductor plant called Terafab.
SpaceX activated Starlink in 2020, disrupting satellite internet with fast, affordable access. It now has 10.3 million subscribers across 164 markets, including Ukrainian troops and Iranian protesters. Starlink provides crucial cash flow for capital-intensive projects.
The Moon and Mars
SpaceX will play a key role in NASA's Artemis program, designing lunar landers for a planned 2028 moon landing. The company also aims to colonize Mars, with a massive bonus for Musk tied to establishing a million-person colony. Musk describes this as key to humanity's long-term survival.
Not Really Public Yet
Until the IPO, only large financial players and very wealthy individuals can buy SpaceX shares directly. By the time the public can purchase, early gains may be gone. The extraordinary valuation reflects faith in Musk's sci-fi promises rather than current business reality. Despite the public listing, Musk will retain over 80% voting power, allowing him to control shareholder decisions.
Private Spaceflight Pioneer
Founded in 2002, SpaceX broke new ground for private spaceflight. In 2012, it docked a private spacecraft with the International Space Station (ISS) for the first time. In 2020, it became the first private company to take humans to the ISS, restoring US independent access. Its live-streamed rocket launches draw large audiences and crowds.
