SpaceX may go public this year. As has been widely reported, the private space firm founded by Elon Musk is sizing up a public offering with major investment banks currently vying to lead the IPO.
Estimates of the firm’s valuation are currently around $800 billion, with some pegging the IPO at a whopping $1.5 trillion.
Republic, the world’s largest online investment platform for private securities, completed the sale of its first “Mirror Token” last fall, allowing investors to purchase securities that are designed to match equity in a private firm. The first offering was for SpaceX, with a valuation set by a prior funding round of $400 billion. The offering closed in October with investors holding rSPAX tokens in their Republic wallet. A similar offering was made available to UK investors on Republic Europe (formerly Seedrs).
This week, Republic was touting the change in valuation between the private security offering for their rSPAX tokens and the potential valuation of SpaceX. If the company holds the $800 billion level, this will represent a pretty quick 2X return for investors. If it goes higher, well thats even better for token purchasers.
While Republic initially wanted to make the SpaceX-derived offering to retail investors, in the end, the offering used the Reg D exemption, which is only available to Accredited Investors.
Investing in private securities can be risky, but investing in more mature firms can mitigate some of that risk. An established business is less risky than a pre-revenue startup. Republic, like some other online investment platforms, is offering a broader selection of private securities to cater to a broader range of investors and varying degrees of risk tolerance.
If Congress updates the definition of an Accredited Investor to remove its current discriminatory language, Reg D offerings may be made available to a far wider audience of investors.
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