The SpaceX IPO isn't even the main story
The Sandbox Daily (6.10.2026)
Welcome, Sandbox friends.
Today’s Daily discusses:
SpaceX isn’t the story
Let’s dig in.
Blake
Markets in review
EQUITIES: Russell 2000 -1.10% | S&P 500 -1.62% | Dow -1.87% | Nasdaq 100 -1.98%
FIXED INCOME: Barclays Agg Bond -0.06% | High Yield -0.19% | 2yr UST 4.135% | 10yr UST 5.027%
COMMODITIES: Brent Crude +1.77% to $87.17/barrel. Gold -4.18% to $4,107.2/oz.
BITCOIN: -0.17% to $61,560
US DOLLAR INDEX: +0.12% to 100.03
CBOE TOTAL PUT/CALL RATIO: 0.96
VIX: +11.83% to 22.22
Quote of the day
“The more a person depends on external stimulation, the poorer their inner life becomes.”
- Erich Fromm
SpaceX may be the most important IPO ever. That doesn’t mean it’s a great stock.
The SpaceX initial public offering (IPO) is arriving at a moment when investors are already being asked to finance the largest wave of capital spending in modern history.
SpaceX. OpenAI. Anthropic. Even public companies like Alphabet and Meta Platforms are weighing multi-billion dollar equity offerings to fund AI CapEx.
And this recent wave comes after several years of the artificial intelligence infrastructure buildout that has already seen the register rung to the tune of a trillion plus dollars.
The challenge isn’t finding investors who believe in AI. The challenge is finding enough capital to fund every AI ambition simultaneously.
That’s what makes the SpaceX IPO so fascinating.
At a rumored valuation around $2 trillion, SpaceX would instantly become one of the largest companies on Earth. Yet calling it a “rocket company” misses the point entirely.
It’s a communications company through Starlink. A defense company through its government partnerships. An infrastructure company connecting remote corners of the world. Increasingly, it’s an AI play after SpaceX acquired the artificial intelligence startup, xAI.
And, perhaps most importantly, it’s a company opening access to an entirely new frontier.
The most important companies in history didn’t simply dominate industries. They expanded the boundaries of what was economically possible.
Railroads connected continents. AT&T connected people. The internet connected information.
SpaceX may connect Earth to the next chapter of economic development. That’s why investors are struggling to value it.
What exactly is SpaceX?
Elon Musk? Aerospace? Communications? Defense? Technology? Infrastructure? The answer is probably all of the above.
Before a single share has traded, portions of Wall Street have already begun adapting around it.
Index providers have rewritten rules to accelerate inclusion. Exchanges, clearinghouses, and brokers have spent months preparing for unprecedented trading volumes. Passive funds are modeling billions in automatic purchases.
In other words, SpaceX is so large that parts of the market’s plumbing are being rebuilt around its arrival.
And that’s where investors should exercise caution.
History shows that great companies and great investments are not always the same thing.
Looking at the 10 largest U.S. IPOs since 2000, seven delivered negative returns over their first 12 months as public companies. The average first-year return was -26.8%.
The lesson isn’t that these were bad businesses. In fact, quite the opposite.
Meta is a cash cow. Blackstone runs a great business around private markets. Uber has transformed the way we think about transportation.
Many of these companies eventually rewarded long-term investors. The problem was price.
As Yale finance professor Roger Ibbotson recently observed, narrative enthusiasm can create a “superstar premium.” Investors don’t lose money because they identify the wrong company. They lose money because they pay the wrong price for the right company.
That risk feels especially relevant today.
SpaceX isn’t arriving in isolation. It’s arriving alongside a wave of AI-related spending and capital raising that likely stretch public markets in ways we’ve never seen before.
As Jim Cramer recently put it: “There are a lot of mouths to feed and not enough to eat.”
Every dollar that flows into SpaceX has to come from somewhere. Index funds may need to rebalance. Active managers will feel pressure to own it. Retail investors may sell existing winners to make room. In other words: volatility. Which arrived in spades over the past week.
The question isn’t whether investors want SpaceX. The question is what they’ll sell to buy it.
That’s why I keep coming back to the same conclusion.
SpaceX may eventually become one of the most important companies ever built. It may help define the future of communications, defense, artificial intelligence, and humanity’s expansion beyond Earth.
Even cosmology professor Brian Cox views SpaceX and private spaceflight as a monumental leap for humanity.
But history suggests that some of the greatest businesses in history don’t necessary align with the value assigned to it.
Wall Street has spent months debating what SpaceX is worth. I think that’s the wrong question.
The more interesting question is: where does the money come from?
The SpaceX IPO matters because it is becoming a stress test for the financial system itself.
Chart Sources: Exhibit A, Bloomberg
That’s all for today.
Blake
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Welcome to The Sandbox Daily, a daily curation of relevant research at the intersection of markets, economics, and lifestyle. We are committed to delivering high-quality and timely content to help investors make sense of capital markets.
Blake Millard is the Director of Investments at Sandbox Financial Partners, a Registered Investment Advisor. All opinions expressed here are solely his opinion and do not express or reflect the opinion of Sandbox Financial Partners. This Substack channel is for informational purposes only and should not be construed as investment advice. The information and opinions provided within should not be taken as specific advice on the merits of any investment decision by the reader. Investors should conduct their own due diligence regarding the prospects of any security discussed herein based on such investors’ own review of publicly available information. Clients of Sandbox Financial Partners may maintain positions in the markets, indexes, corporations, and/or securities discussed within The Sandbox Daily. Any projections, market outlooks, or estimates stated here are forward looking statements and are inherently unreliable; they are based upon certain assumptions and should not be construed to be indicative of the actual events that will occur.
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