How to Invest in SpaceX

So, you want to invest in SpaceX? You're not alone. The allure of being part of Elon Musk's groundbreaking aerospace company is strong, especially with the company making massive strides in space exploration, satellite deployment, and even commercial space tourism. But here's the catch: you can't invest directly in SpaceX right now. However, there are ways to get exposure to this private company's success if you know where to look.

Many are drawn to SpaceX due to its technological achievements—such as launching reusable rockets and the promise of interplanetary colonization. It's understandable why investors are eager to hop on board. But the first thing you need to realize is that SpaceX is not publicly traded. This makes the process of buying into it more complex than simply purchasing shares on the stock market. The good news? There are multiple strategies that could potentially give you exposure to the company's success, even without directly holding SpaceX shares.

The SpaceX Investment Paradox

Let's dive into the paradox of investing in SpaceX. On the one hand, you can’t just buy its stock because it remains privately held. On the other hand, there’s a burgeoning space economy valued at over $424 billion as of 2022, and SpaceX is a major player. Many experts predict the space industry could grow to $1 trillion by 2040. So, how can you ride this wave if you can't buy SpaceX stock?

First, let’s consider pre-IPO investment options and indirect ways to gain exposure.

Private Shares and Pre-IPO Access

For accredited investors, one option is to buy pre-IPO shares. Private companies like SpaceX occasionally offer early investors the chance to buy shares before the company goes public. These pre-IPO stocks are usually offered through special financial networks or secondary market platforms like EquityZen or Forge Global. However, this option is typically limited to accredited investors—individuals with a net worth of $1 million or more, or those who meet certain income requirements.

Although these platforms offer secondary shares, you should be aware that buying pre-IPO stock comes with risks. Unlike shares listed on public exchanges, these shares lack liquidity, meaning it can be difficult to sell them until the company goes public or gets acquired.

Investing in SpaceX Partners and Competitors

While you may not be able to directly invest in SpaceX, you can invest in companies that work closely with them or operate in similar markets. SpaceX partners with companies like Google, Lockheed Martin, and Northrop Grumman for various aerospace and satellite projects. These companies provide important technology and services to SpaceX’s operations, so they stand to benefit as SpaceX continues to grow.

Another angle is investing in competitors like Blue Origin or Rocket Lab. While these companies are not exactly identical to SpaceX, they operate in the same space industry and are publicly traded. By investing in the broader space economy, you're positioning yourself to benefit from the general rise of the sector, even if you don’t hold SpaceX shares.

Below is a table that outlines key SpaceX partners and competitors you can invest in:

Company	Role	Stock Symbol
Alphabet (Google)	SpaceX partner, investor	GOOG
Lockheed Martin	Aerospace contracts, space exploration	LMT
Northrop Grumman	Satellite and rocket services	NOC
Rocket Lab	Competitor in small satellite launches	RKLB
Boeing	Aerospace, satellite manufacturing	BA

Venture Capital Funds and ETFs

If private investing seems too complicated or you're not an accredited investor, venture capital funds and space ETFs (Exchange Traded Funds) offer a more accessible route. There are several space-focused ETFs that include exposure to companies involved in space exploration, satellite manufacturing, and related technologies. While these funds may not hold SpaceX shares directly, they include companies that stand to benefit from SpaceX’s success.

Some prominent ETFs in this space include:

• ARK Space Exploration & Innovation ETF (ARKX): Managed by Cathie Wood’s ARK Invest, this ETF invests in companies that are leading in aerospace innovation.
• Procure Space ETF (UFO): This ETF tracks companies that are actively involved in the space industry, such as satellite communications and rocket launches.

These ETFs provide a diversified way to invest in the overall space economy. While they don't directly hold SpaceX stock, they offer exposure to the broader industry, making them a more accessible option for retail investors.

Indirect Ownership through Tesla?

Another popular theory involves investing in Tesla, the electric vehicle company led by Elon Musk, as a way to get indirect exposure to SpaceX. While there is no formal connection between the two companies in terms of ownership, Musk’s leadership and strategic vision often intertwine the operations of both companies. For instance, Tesla uses SpaceX technology in some of its satellite-based services, and SpaceX often utilizes Tesla’s innovations in battery technology. This could create synergies between the two companies that benefit Tesla investors.

Tesla has also been involved in space-related projects, including developing solar power technology for space applications. Thus, some investors argue that betting on Musk through Tesla is, in a roundabout way, betting on the continued success of SpaceX.

Risks Involved in Space Investing

Before you get too excited about the idea of investing in SpaceX indirectly, it's important to consider the risks involved in space-related investments. Space exploration is highly capital-intensive and comes with substantial regulatory, technical, and operational risks. SpaceX’s ambitious goals, such as colonizing Mars or launching thousands of satellites for the Starlink project, require billions of dollars in funding and many years of research and development.

There’s also competition from other well-funded aerospace giants like Blue Origin and Virgin Galactic. These companies are racing to capture market share in the emerging space economy, and any setbacks—such as failed launches or cost overruns—can have a significant impact on the companies’ stock prices and, by extension, on investors' returns.

Will SpaceX Go Public?

Now, the million-dollar question: will SpaceX ever go public? According to Elon Musk, there are no immediate plans to take the company public. He has stated that he wants to wait until “Mars is safely colonized” before considering an IPO. This could mean waiting several more years before retail investors can directly purchase SpaceX shares.

However, many analysts speculate that Starlink, SpaceX’s satellite internet service, could be spun off as a separate, publicly traded entity. This would offer investors a direct way to get exposure to one of SpaceX’s most promising projects. Starlink already boasts hundreds of thousands of users, and its success is crucial to SpaceX’s long-term financial viability.

Conclusion: Playing the Long Game

For now, direct investment in SpaceX remains elusive for most investors, but there are multiple ways to gain exposure to the space economy and SpaceX’s growth trajectory. From pre-IPO shares to ETFs and investments in partner companies, you have plenty of options to get in on the action. Keep an eye on Starlink, as it could become the first publicly available route to owning a piece of SpaceX.

Ultimately, investing in space is a long-term play. The sector is still in its early stages, and the biggest wins could be a decade or more away. But for those willing to take the risk and think beyond Earth’s atmosphere, the rewards could be astronomical.