Before a $1.5 Trillion IPO, Elon Musk Came Close to Losing It All

In the winter of 2025, the sea breeze in Boca Chica, Texas was as salty and fierce as ever, while Wall Street's air crackled with unusual intensity.

On December 13, a piece of news surged to the top of financial headlines like a Falcon Heavy launch. SpaceX's latest internal share sale set the company's valuation at $800 billion.

According to an internal memorandum, SpaceX is actively preparing for an IPO in 2026, with plans to raise more than $30 billion. Elon Musk hopes the company's overall valuation can reach $1.5 trillion. If successful, this would place SpaceX's market value close to the record-setting level achieved by Saudi Aramco during its 2019 listing.

For Musk, this is an almost surreal moment.

As the world's richest man, his personal fortune would rise alongside SpaceX's ascent as a "super rocket," potentially pushing his net worth beyond all historical records and making him the first trillionaire in human history.

Rewind the clock 23 years, and few would have believed this outcome. At the time, SpaceX was seen by industry giants Boeing and Lockheed Martin as little more than a fragile upstart that could be crushed at any moment.

More precisely, it resembled a disaster that simply refused to come to an end.

When a Man Decides to Build Rockets

In 2001, Elon Musk was 30 years old.

He had just cashed out of PayPal, holding more than $100 million in liquidity, standing at what Silicon Valley often calls the "point of financial freedom." Like Marc Andreessen, the founder of a16z, he could have become an investor, a thought leader, or simply stepped away from work altogether.

Instead, Musk chose a far more improbable path.

He decided to build rockets, and ultimately, to go to Mars.

To pursue this ambition, he traveled to Russia with two close friends, hoping to purchase refurbished Dnepr launch vehicles to support what he called the Mars Oasis project.

The outcome was humiliating.

During negotiations with the Lavochkin Design Bureau, a Russian chief designer reportedly spat at Musk, dismissing him as an American nouveau riche who knew nothing about aerospace engineering. The Russians eventually quoted an exorbitant price and implied that if he could not afford it, he should leave. The team returned home empty-handed.

On the return flight, his companions were dejected. Musk, however, was tapping away on his laptop. After a moment, he turned around and showed them a spreadsheet.

"Hey, I think we can build it ourselves."

That same year, China had just launched Shenzhou 2. Spaceflight was widely viewed as a national endeavor, a feat achievable only through the full mobilization of state power. For a private company to attempt building rockets was as absurd as a schoolchild claiming they could build a nuclear reactor in their backyard.

This was SpaceX's leap from zero to one.

Growth Is a Process of Repeated Failure

In February 2002, SpaceX was formally founded in an old 75,000 square foot warehouse at 1310 East Grand Avenue in El Segundo, a suburb of Los Angeles.

Musk invested $100 million from his PayPal exit as seed capital and defined the company's vision as the "Southwest Airlines of the space industry," aiming to deliver low-cost, highly reliable space transportation services.

Reality, however, quickly delivered a harsh blow. Building rockets was not only difficult, it was extraordinarily expensive.

There is a well-known saying in the aerospace industry: "Without a billion dollars, you cannot even wake Boeing up."

Against this backdrop, Musk's $100 million looked insignificant. Even more daunting was the competitive landscape. SpaceX was entering a market tightly controlled by entrenched giants such as Boeing and Lockheed Martin. These century-old incumbents possessed not only overwhelming technical capabilities, but also deep and well-established government relationships.

Accustomed to monopoly positions and lucrative government contracts, they had only one reaction to SpaceX's arrival.

They treated it as a joke.

In 2006, SpaceX's first rocket, Falcon 1, stood on the launch pad.

The name was both a tribute to the U.S. Defense Advanced Research Projects Agency's Falcon program and a nod to the Millennium Falcon from Star Wars. It was small and somewhat spartan, almost like a prototype rather than a finished product.

As expected, the rocket exploded just 25 seconds after liftoff.

In 2007, the second launch followed. After a few minutes of flight, it again lost control and crashed.

Mockery was widespread. One cutting remark circulated widely: "Does he think rockets are software, something you can just patch after deployment?"

In August 2008, the third failure was the most devastating. The first and second stages collided, and the moment of ignition that had carried so much hope disintegrated into debris over the Pacific Ocean.

The mood shifted completely. Engineers began to lose sleep, suppliers started demanding cash upfront, and the media dropped any remaining courtesy. Most critically, the money was nearly gone.

In 2008, Musk faced the darkest year of his life.

The global financial crisis was sweeping across the world. Tesla was on the brink of bankruptcy. His wife of ten years left him. At SpaceX, funding was sufficient for only one final launch. If the fourth attempt failed, SpaceX would shut down on the spot, and Musk would be left with nothing.

Then came the sharpest blow of all.

Two of Musk's childhood heroes, Neil Armstrong, the first human to walk on the Moon, and Gene Cernan, the last, publicly expressed complete skepticism toward his rocket ambitions. Armstrong stated bluntly, "You do not understand what you do not understand."

Years later, when recalling this period, Musk's eyes welled up on camera. He did not cry when rockets exploded. He did not cry when his company was close to collapse. But when he spoke about the ridicule from his idols, he broke down.

Musk said to the interviewer, "These are people I've always considered heroes. It was incredibly hard. I really wish they could come and see how hard this work truly is."

At that moment, a line of text appeared on the screen:

"Sometimes, the very people you look up to let you down."

A Fight for Survival

Before the fourth launch, no one spoke of Mars anymore.

The entire company was shrouded in a somber, almost tragic silence. Everyone understood that this Falcon 1 had been assembled with the last remaining funds. If it failed, the company would be forced to shut down.

On launch day, there were no grand declarations and no rousing speeches. Only a small group of people stood in the control room, silently staring at the screens.

On September 28, 2008, the rocket lifted off, a column of fire illuminating the night sky.

This time, the rocket did not explode. Yet the control room remained eerily quiet until nine minutes later, when the engine shut down as planned and the payload successfully entered its designated orbit.

"We did it."

Thunderous applause and cheers erupted throughout the control center. Musk raised both arms in the air, while his brother Kimbal, standing beside him, began to cry.

Falcon 1 made history. SpaceX became the world's first private commercial aerospace company to successfully launch a rocket into orbit.

That single success not only saved SpaceX, but also secured the company a long-term lifeline for the future.

On December 22, Musk's phone rang, bringing a close to his ill-fated 2008.

NASA's associate administrator for spaceflight, William Gerstenmaier, delivered the good news. SpaceX had been awarded a $1.6 billion contract to conduct 12 cargo missions between Earth and the International Space Station.

"I love NASA," Musk blurted out. Shortly after, he changed his computer login password to "ilovenasa."

After brushing against the edge of collapse, SpaceX had survived.

Jim Cantrell, one of the earliest engineers involved in SpaceX's rocket development and a longtime friend who had once lent Musk his college rocket engineering textbooks, later reflected on the Falcon 1 success with deep emotion:

"Elon Musk did not succeed because he was extraordinarily farsighted, not because he was exceptionally intelligent, and not because he worked tirelessly, although all of those are true. The most important element of his success is that the word 'failure' does not exist in his dictionary. Failure was never part of his thinking."

Bringing Rockets Back Home

If the story ended here, it would be nothing more than an inspirational legend.

But the truly formidable chapter of SpaceX began only after this point.

Musk insisted on a goal that appeared irrational to many: rockets had to be reusable.

Almost all internal experts opposed the idea. It was not that reusability was technically impossible, but that it was commercially too radical, often compared to "no one bothering to recycle a disposable paper cup."

Musk, however, refused to back down.

He argued that if airplanes were discarded after a single flight, no one would be able to afford air travel. Likewise, if rockets could not be reused, spaceflight would remain a game reserved for a privileged few.

This was Musk's underlying logic, his first principles approach.

Returning to the beginning of the story, why did Musk, a programmer by training, dare to personally step into rocket building?

In 2001, after studying countless technical books, Musk broke down the cost structure of rocket manufacturing in detail using a single Excel spreadsheet. His analysis showed that the production costs of rockets had been artificially inflated by traditional aerospace giants by several multiples.

These well-funded incumbents had long grown comfortable with a "cost plus" model. Even a single bolt could cost hundreds of dollars. Musk, however, would ask a simple question: "The raw aluminum and titanium used in this part are traded on the London Metal Exchange for a fraction of that price. Why does it become a thousand times more expensive once it is turned into a component?"

If costs were artificially inflated, then they could also be artificially driven down.

Guided by first principles, SpaceX embarked on a path with almost no room for retreat.

They launched repeatedly. When rockets exploded, they analyzed the failures. After analysis, they launched again. They failed, learned, and kept attempting recovery over and over.

All doubts came to an abrupt end on that winter night.

On December 21, 2015, a date destined to be written into the history of human spaceflight, Falcon 9 lifted off from Cape Canaveral Air Force Station carrying 11 satellites.

Ten minutes later, a miracle occurred. The first stage booster successfully returned to the launch site, descending vertically onto the landing zone in Florida like a scene from a science fiction film.

In that moment, the old rules of the aerospace industry were completely shattered.

The era of low-cost spaceflight was ushered in by a company once dismissed as an underdog.

Building Starship with Stainless Steel

If reusable rockets were SpaceX's challenge to physics, then building Starship with stainless steel was Musk rewriting the rules of engineering.

In the early development of Starship, a vehicle designed to enable the colonization of Mars, SpaceX initially fell into the industry's obsession with "advanced materials." The prevailing belief was that to reach Mars, a rocket had to be as light as possible, which meant relying on expensive and complex carbon fiber composites.

To that end, SpaceX invested heavily in massive carbon fiber winding tooling. But slow progress and soaring costs raised alarms for Musk. He returned to first principles and ran the numbers.

Carbon fiber cost as much as $135 per kilogram and was extremely difficult to manufacture. By contrast, 304 stainless steel, the same material used to make everyday kitchen cookware, cost roughly $3 per kilogram.

"But stainless steel is too heavy," critics objected.

In response to engineers' skepticism, Musk pointed to a physical reality that had been overlooked: melting point.

Carbon fiber has poor heat resistance and requires heavy, expensive thermal protection tiles. Stainless steel, by contrast, has a melting point of around 1,400 degrees Celsius, and its strength actually increases under the ultra-low temperatures of liquid oxygen. When the weight of the thermal protection system is taken into account, a rocket built from seemingly "heavy" stainless steel ends up with a total system mass comparable to carbon fiber, while costs are reduced by a factor of forty.

This decision freed SpaceX from the constraints of precision manufacturing and exotic aerospace materials. Clean rooms were no longer necessary. In the open fields of Texas, rockets could be welded under tents like water towers. When one exploded, it was not a catastrophe. The debris was cleared away, and welding resumed the next day.

This first principles mindset runs through SpaceX's entire development. From questioning "why can rockets not be reused?" to asking "why must space-grade materials be expensive?", Musk consistently starts from fundamental laws of physics to challenge long-held industry assumptions.

"Building world-class engineering with bargain-priced materials" is the true core competitiveness of SpaceX.

Starlink Is the True Game Changer

Technological breakthroughs drove a surge in valuation.

From $1.3 billion in 2012, to $400 billion in July 2024, and now $800 billion, SpaceX's valuation has quite literally "gone vertical."

But what truly supports this staggering valuation is not rockets. It is Starlink.

Before Starlink, SpaceX existed mainly as a spectacle to the general public, appearing in news headlines for dramatic explosions or spectacular landings.

Starlink changed everything.

This low Earth orbit constellation of thousands of satellites is becoming the world's largest internet service provider. It has transformed spaceflight from something to be watched into essential infrastructure, as fundamental as water and electricity.

Whether on a cruise ship in the middle of the Pacific Ocean or amid the ruins of an active war zone, a signal can stream down from low Earth orbit hundreds of kilometers above, as long as there is a receiver no larger than a pizza box.

It not only reshaped the global communications landscape, but also became a powerful cash-generating engine, providing SpaceX with a steady and recurring flow of revenue.

As of November 2025, Starlink had reached 7.65 million active subscribers worldwide, with total users exceeding 24.5 million. North America accounted for 43 percent of subscriptions, while emerging markets such as South Korea and Southeast Asia contributed 40 percent of new user growth.

This is precisely why Wall Street is willing to assign SpaceX such an extraordinary valuation. It is not driven by how frequently rockets are launched, but by the recurring revenue generated by Starlink.

Financial data indicates that SpaceX's projected revenue for 2025 is $15 billion, with expectations to surge to $22 to 24 billion in 2026. More than 80 percent of this revenue is expected to come from the Starlink business.

This marks a decisive transformation for SpaceX. It is no longer merely a contract-dependent aerospace contractor. It has evolved into a global telecommunications giant with a monopoly-level competitive moat.

On the Eve of the IPO

If SpaceX succeeds in raising $30 billion through its IPO, it would surpass Saudi Aramco's $29 billion offering in 2019 and become the largest IPO in history.

According to forecasts from several investment banks, SpaceX's final IPO valuation could reach as high as $1.5 trillion. This would put it within striking distance of Saudi Aramco's record $1.7 trillion listing in 2019 and place SpaceX directly among the world's top 20 publicly listed companies by market capitalization.

Behind these staggering figures, the first group to feel the excitement is the workforce at the Boca Chica and Hawthorne facilities.

In the most recent internal share sale, a price of $420 per share meant that engineers who once slept on factory floors alongside Musk and endured countless periods of "production hell" could soon see the emergence of many new multi-millionaires and even billionaires.

For Musk, however, an IPO is by no means a traditional cash-out or exit. It is an expensive form of refueling.

Until recently, Musk had consistently opposed taking the company public.

At a company-wide meeting in 2022, Musk poured cold water on any IPO expectations, telling employees not to romanticize the idea of going public. "Going public is absolutely an invitation to pain, and the stock price only serves as a distraction," he said.

Three years later, what changed Musk's mind?

No matter how bold the ambition, it still requires capital.

According to Musk's timeline, within two years the first Starship will attempt an uncrewed landing test on Mars. Within four years, human footprints are expected to be planted on the planet's red soil. His ultimate vision is even more ambitious. Within twenty years, through the continuous operation of 1,000 Starships, he aims to build a self-sustaining city on Mars.

The capital required to realize that vision remains astronomical.

In multiple interviews, Musk has stated plainly that the sole purpose of accumulating wealth is to make humanity a "multi-planetary species." Viewed from this perspective, the tens of billions of dollars raised through an IPO can be seen as an "interstellar toll" charged to Earth.

We watch with anticipation, hoping that the largest IPO in human history will not be converted into yachts or mansions. Instead, it will be transformed into fuel and steel, paving the long and difficult road toward Mars.

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