SapceX, the space exploration firm founded by the billionaire entrepreneur Elon Musk is now valued at about $74 billion after the company completed another massive round of equity funding which was reportedly valued at about $850 million last week, said reports quoting sources with knowledge of the matter.
The new funds were raised at $419.99 a share which was just a cent lower than the price of $420 that Musk had mentioned in his now infamous tweet in 2018 when the entrepreneur said that he had “funding secured” to take Tesla private.
In August last year, SpaceX raised almost $2 billion at a $46 billion valuation and therefore the latest round of funding is also a 600 per cent jump in the valuation of the company since the last finding round.
There were no comments available on the issue from SpaceX.
Report quoted sources saying that an additional $750 million in a secondary transaction were allowed to be sold by company insiders and existing investors in addition to the company itself being able to generate a large amount of funds.
Reports however stated that only a portion of the funding available in the marketplace was raised by SpaceX and sources reportedly said that “insane demand” of about $6 billion in offers had been received by the company during a period of just three days.
This latest cash injection in the company will come in handy for financing the efforts of the company to simultaneously develop two capital-intensive projects.
One of the most important and ambitious projects of SpaceX is called Starlink which comprises of building a network with thousands of satellites the are interconnected – known as a constellation in the industry, aimed at offering low cost high speed internet to people in the remotest areas of the world. According to previous estimates made by the company, Starlink will cost the company about $10 billion or more to complete the network. The company however firmly believes that it can generate as much as $30 billion a year form the network which would be over 10 times the annual revenues that the company currently generates from its existing rocket business.
There are more than 10,000 users in the United States and abroad” for its Starlink service which the company had has garnered in just over three months since it started the public beta, the company disclosed in an Federal Communications Commission filing last week.
The plan of SpaceX also involves the eventual spinning off of Starlink and of taking it public, Musk also reiterated last week. Starlink “needs to pass through a deep chasm of negative cash flow over the next year or so”, he said.
“Once we can predict cash flow reasonably well, Starlink will IPO,” Musk said.
Another ambitious project of SpaceX is its Starship rocket project under which the company is continuing to build and test prototypes in Boca Chica, Texas. Multiple Starship prototypes have been successfully launched by the company as it has landed the rockets safely after short flights of about 500 feet in the air.
(Adapted from CNBC.com)