SpaceX IPO is a Bet on the Future, Says LBS Professor James Dow

With SpaceX expected to make its highly anticipated public market debut on 12 June at a valuation approaching $1.77trn, investors are being asked to place a price on a future that remains largely unwritten.

Speaking on CNBC Europe's Early Edition with Carolin Roth and Steve Sedgwick, London Business School’s Professor James Dow said the success of the IPO ultimately depends on factors that extend well beyond conventional valuation models.

"SpaceX's valuation depends on technologies that haven't existed so far," Dow said. "It depends on what kind of rules govern exploration and exploitation of space, whether competitors emerge, and where Elon Musk chooses to spend his energy."

The IPO, expected to raise around $75bn, has already attracted significant attention due to its unusually large allocation for retail investors. Approximately 30 per cent of the shares on offer are expected to be made available to individual investors, a move that has prompted comparisons with previous periods of market exuberance.

Dow acknowledged the historical parallels but stopped short of describing the offering as a bubble.

"The dot-com era involved many companies," he said. "Here, there is really one dominant player. SpaceX also depends much more heavily on geopolitics and regulation than those earlier technology booms."

At the heart of the investment case is Elon Musk himself. While some market commentators have described the IPO as a referendum on the billionaire entrepreneur, Dow argued that Musk's track record demonstrates an ability to sustain investor interest even when his attention is divided among multiple ventures.

"He is doing genuinely innovative things," Dow noted, pointing to SpaceX's Starlink satellite network as evidence that the company has already delivered commercially successful technological breakthroughs.

Yet Dow also highlighted the distinction between enthusiasm for a technology and confidence in its market valuation.

"Sometimes these things do work," he said. "Many companies that people doubted would achieve long-term profitability have gone on to become extraordinarily successful."

Governance remains a major point of debate ahead of the listing. US Senator Elizabeth Warren has called on regulators to delay the IPO, citing concerns about Musk's influence, the company's dual-class share structure and broader governance arrangements.

For Dow, however, the most significant governance question is a longer-term one.

"The valuation of SpaceX depends on what it's going to be doing in 20 years," he said. "In 20 years, Musk will be quite elderly. I don't know what he'll be doing then, and yet the valuation of SpaceX is inevitably very tied up with him."

As investors prepare for one of the largest and most closely watched IPOs in market history, Dow's assessment suggests that the SpaceX offering represents something unusual even by technology-sector standards: a company with enormous potential, but whose ultimate value depends on technological breakthroughs, regulatory decisions and leadership choices that remain uncertain.

For investors, the challenge is deciding how much that future is worth today.