00:00 Speaker A
you say, IPO activity still hasn’t recovered to 2021 levels. So is this excitement, is it is it just about SpaceX or maybe folks are also getting excited about the broader reopening of the IPO market? What do you think?
00:15 Speaker B
I think that is a part of it. And look, for full disclosure, we know we had some spack stuff going on back then, but still, we are at last year was less than half of the levels of 21 and 22. And so there’s absolutely some pent up demand. and we all know the story of the longer incubation periods. So there really is a little bit of a pent up demand for IPO. So I think it’s not just so narrow with respect to the excitement about a couple of specific names.
00:43 Speaker A
What do you think gets people so excited about SpaceX? Like is it is it the launch business, uh AI infrastructure story, is it Starling? Is it like the mythology of Musk? Maybe it’s all of it.
00:56 Speaker B
I’m sure the personality is a part of it, but look, you’ve got three lines of business and and everybody’s talking about them. They’ve got something like 80% share of the launch business. Starlink is the one that’s making lots and lots of money and the AI piece is the newer piece, but then they get a big contract with Google. So you got a cool call option on that. So it is a pretty darn robust business model. and look, you know, folks kind of want to think about the timing and and and how folks want to launch it. But remember,
01:29 Speaker B
IPOs are done for a small fraction of the market value of those companies. So those folks don’t want anything to go wrong because it’s almost a trial balloon in the sense of the size of the IPO compared to the value of the entire entity.
01:41 Speaker B
The odds of there being a tradeoff in that sense are relatively low. And, you know, a lot of folks are talking about the index piece. So it will be cool that they’ll be in some but not all. They won’t be in S&P right away, but they’ll be in Nasdaq. So that’s just kind of a stabilizing force with respect to demand. But there’s still cash on the sidelines as we all know. So I I don’t really see a form for the selling of a chunk of existing public AI names to fund investment in space.
02:12 Speaker A
Uh when it starts trading, you want to place a bet, what do you think demand’s going to be like? What’s the reception for for SpaceX by public market investors?
02:22 Speaker B
Uh it should be really, really strong and you know, we we’ve we’re actually in registration for our levered guy. Uh we’re not effective, but if anybody wants to follow where we’re at, they can head over to our website, but the website, excuse me, the demand looks quite strong for the IPO. They’re always strong coming out of the gate, uh but this one may very have well well have legs.
