Starlink IPO: How to Buy Starlink Stock When It Goes Public
Melissa holds a bachelor’s degree in English education as well as a master’s degree in the teaching of writing, both from Humboldt State University, California. This won’t be known until very close to the initial public offering, when the underwriters and investment banks will agree on a price. It’s hard to know for sure, but self-proclaimed ‘Technoking’ Elon Musk has hinted that the Starlink IPO (initial public offering) will likely take place in 2025 or 2026. Elon Musk’s main criteria is that he wanted Starlink to be profitable with a predictable cash flow.
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There are also concerns about light pollution and even Starlink’s satellites potentially interfering with the work of astronomers. Another problem is that some users reported “non-existent” customer service — something that will need to be addressed going forward. At the moment, it’s not for certain that Starlink will be sustainable from a financial standpoint. Musk says the company needs up to $30 billion in annual funding to survive. He said in 2021 that the company was spending $1,000 to produce Starlink terminals, which it sells for $500. Thus, while Starlink has secured some funding, it will need more to survive — and ultimately bring its manufacturing costs down.
Bank of America (BAC) invested $250 million at a valuation of ~$30 billion in November 2018. At today’s valuation, this investment is likely worth around $1.15 billion. Together, these investments are worth $10.5 billion, or about 7% of SpaceX and Starlink. This was a $900 million investment at a valuation of $12 billion.
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If you like Google and/or Bank of America and want to invest in their stock anyway, simultaneously getting exposure to Starlink is a nice bonus. Here’s what we know about the IPO — and how to buy Starlink stock when it’s available. The timeframe for a potential Starlink spinoff IPO ranges from late 2024 to 2027. To explain why, we need to first explain the different types of internet. The two most common are land-based connections and cellular or mobile connections. Right now, Starlink is a part of SpaceX and isn’t its own company.
Is Starlink profitable?
Please don’t interpret the order in which products appear on our Site as any endorsement or recommendation from us. Finder.com compares a wide range of products, providers and services but we don’t provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service. Starlink is a satellite internet constellation project developed by SpaceX—Elon Musk’s aerospace company.
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If we assume the average customer pays Starlink $100 per month, its 2 million customers are currently generating $200 million per month in revenue, or $2.4 billion per year. If you don’t like the other 99.4% of Google’s business, I wouldn’t recommend buying its shares to gain exposure to Starlink. While this is a sizable stake, Alphabet is a $1.75 trillion company, so its $10.5 billion stake in SpaceX represents about 0.6% of its total business. While there’s no way to invest directly in Starlink or SpaceX right now, here are a few ideas for gaining indirect exposure.
- Also, unless you’re a well-heeled and well-connected investor, chances are you won’t have access to an IPO at the initial offering price.
- There are now pre-IPO investing platforms that may allow you to trade Starlink or SpaceX shares before they go public.
- Well, for one thing Starlink sales dominated SpaceX’s 2023 revenues, meaning the company made more money as an internet provider than as a space rocket company.
- That being said, Starlink also needs a license to offer internet services before new customers can sign up.
- On the fundamental side, you usually don’t have much information to work with, perhaps how much revenue a firm with public ambitions generated in the most recent fiscal year.
Starlink is still a private company and not yet publicly traded, so we can’t yet value it based on its market cap on a stock exchange. Currently, the best information we have is based on projections and estimates. We do know that SpaceX has secured some funding specific to broadband access, such as $885 million in broadband subsidies from the Federal Communications Commission. Historically, speed and capacity represent the two most significant drawbacks to satellite internet. Most satellite internet service providers only support speeds between 25 and 300 megabits per second (mbps).
Although betting on IPOs is inherently risky, several factors suggest that a possible Starlink debut will result in a successfully robust capital raise. First and foremost, the underlying satellite internet constellation business is incredibly relevant to our digitalized economy. Second, the space economy is already a multibillion-dollar monster of an industry and will likely only get bigger.
Unfortunately, a satcom business is expensive to manage, and there is a real risk of the business running out of cash soon after it offers a wide-sweeping service. This lack of cash flow predictability — as mentioned above — can delay public trading on Starlink stock for some time. A SpaceX subsidiary, Starlink is a satellite-based internet service provider, delivering high-quality, low-latency performance. Most importantly, SpaceX CEO and Tesla Elon Musk promised to push the Starlink IPO when it is financially viable to do so. The parent company of Starlink, SpaceX, is a privately owned company and not publicly traded on any stock exchange. As a result, individual investors cannot directly purchase shares of SpaceX.
It’s impossible to predict how any stock will perform — and IPOs can be particularly volatile. Looking at the performance of similar companies can help you decide if now is a good time to buy Starlink stock. However, the company appears to be valued at almost $140 billion as of January 2024. Since we lack any substantial official info about the Starlink IPO, guessing its the projected price of its stock is difficult.
Tesla vehicles are how do you calculate long term assets fully internet-capable, so it’s not far-fetched to think Teslas may one day be able to use a Starlink connection. Find out how to invest in Tesla stock if you want to go this route. Finder monitors and updates our site to ensure that what we’re sharing is clear, honest and current. Our information is based on independent research and may differ from what you see from a financial institution or service provider. When comparing offers or services, verify relevant information with the institution or provider’s site. Information on this page is for educational purposes only and not a recommendation to invest with any one company, trade specific stocks or fund specific investments.
He has experience working in investing, insurance, and a number of other industries. Investors seeking opportunities highly rated by experts can explore ETFs and mutual funds that focus on space-related companies. These funds offer diversified exposure to the space industry and often include well-established companies as well as emerging players. EToro is one of the world’s most popular investing platforms with over 28.5 million users. From an investment perspective, the coolest thing about Starlink isn’t necessarily what the company does — but who’s behind it.
Anyone who chooses to add Starlink shares to their portfolio if the company does go public should first ensure they understand what to expect — something they cannot do by listening to hype alone. Traditional satellite internet is something of a fusion between mobile and landline, albeit over a vastly larger distance. The history of satellite internet traces back to 1962, with the world’s first commercial communication satellite. Known as Telstar 1, the satellite was launched by NASA in response to Russia’s successful launch of the satellite Sputnik 1. It had a short life, however; Telstar launched one day after high-altitude nuclear weapons testing, and radiation from the tests damaged electronics on the satellite. It was only operational for seven months before it was rendered inoperable.