SpaceX plans to allocate 30% of new shares to retail investors, and Musk aims to leverage fan support to stabilize the stock price after the IPO.

What is the deeper meaning behind Elon Musk personally orchestrating the IPO allocation?

IT Home, March 27 — According to Reuters today, Musk is considering allocating up to 30% of SpaceX’s IPO shares to individual investors.

In typical U.S. stock IPO practices, companies usually allocate only 5% to 10% of shares to retail investors without lock-up restrictions. Musk hopes to leverage his passionate fan base and other loyal supporters to help stabilize the stock price after listing.

Sources say this is expected to be one of the most high-profile IPOs in recent years, with a structure that deviates from Wall Street’s traditional approach, highlighting Musk’s determination to influence both the composition of shareholders and the trading methods after SpaceX goes public.

According to previous reports, the fundraising scale for SpaceX’s IPO could reach $70-75 billion (approximately 484.124–518.704 billion RMB at current exchange rates), with a target valuation of $1.75 trillion (Note: at current exchange rates, about 12.1 trillion RMB). The previous global IPO record was Saudi Aramco’s $29 billion in 2019 (about 200.565 billion RMB at current rates).

Insiders say Musk’s plan has been communicated to Wall Street by SpaceX CFO Brett Johnson. The plan involves offering retail investors a large-scale allocation while also adopting an unusually “hands-on” approach in selecting underwriters. Additional sources say SpaceX has assigned very narrow roles to certain banks based on personal relationships and past collaborations, rather than allowing broad competition among underwriters within the investor group.

Of course, the plan is not yet finalized and may still be adjusted. Four insiders also revealed that as part of this effort, Musk personally selected U.S. banks to focus on domestic retail distribution. SpaceX has not responded to requests for comment, and U.S. banks have declined to comment.

Insiders believe retail investor demand will be very strong, including wealthy families who have supported SpaceX for years and small to medium investors attracted by Musk’s companies.

Rouwen Taylor, managing partner at Liberty Hall Capital Partners, a private equity firm focused on aerospace and defense (which is not participating in this IPO), said: “This is a once-in-a-lifetime moment; people might feel they must participate.” He compared the current enthusiasm to the excitement around Google’s IPO twenty years ago. “This willingness to invest reflects investor confidence in Musk.”

Sources say SpaceX believes many of these investors have been tracking the company in the private market for years. Compared to immediately cashing out or engaging in “pump-and-dump” style trading after listing, they prefer to hold long-term.

Insiders reveal that Morgan Stanley is expected to handle small retail investors through its E*Trade platform. U.S. Bank is focusing on high-net-worth individuals and family offices within the U.S., while UBS is responsible for international marketing to these investors. Citigroup will coordinate international retail and institutional distribution, working with regionally specialized banks to sell shares to overseas individual investors.

Other banks have also been assigned regional responsibilities: Mizuho covers Japan, Barclays handles the UK, Deutsche Bank manages Germany, and Royal Bank of Canada is responsible for Canada.

Barclays, Citigroup, Deutsche Bank, Mizuho, Morgan Stanley, and RBC all declined to comment. UBS did not immediately respond to requests for comment.