Elon Musk’s proposed pay package in SpaceX’s IPO filing reveals what the company actually is: a $1 trillion monster built to colonize Mars

Elon Musk’s new pay package for SpaceX is the largest in the company’s history, but there’s a slight problem: He won’t get the money until 1 million people live on Mars.

The SpaceX board of directors granted Musk 1 billion Class B ordinary shares of restricted stock on the basis of his existing approximately 5 billion shares, which is worth approximately US$700 billion based on the expected IPO valuation of US$1.75 trillion.

The new shares, which could add $600 billion or more to their value, would vest only if SpaceX meets two conditions: reaching a milestone of $7.5 trillion in its peak market capitalization and establishing a permanent human colony on Mars with at least 1 million residents.

The prospectus answers a question on Wall Street’s mind: Why would SpaceX go public this way? The filing comes three months after Musk merged his artificial intelligence company xAI and social media platform X into SpaceX, a deal that valued the rocket company at $1 trillion and the artificial intelligence company at $250 billion. The combined company set to shock public markets next month looks Frankenstein-like, but the mission statement in the document itself suggests that the seemingly mismatched parts have only one purpose.

“Since its existence, human civilization has lived on one celestial body: Earth. The current paradigm confines human civilization to one planet, which exposes humanity to unpredictable and uncontrollable existential threats on a global scale,” the document reads.

A few sentences later, it added: “We don’t want humans to have the same fate as the dinosaurs.”

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SpaceX is a Mars company, everything else is infrastructure built for the trip.

Mars colonization is a goal that Musk has been pursuing since he was a child reading Asimov’s works. It requires more than just rockets. It requires robots to build habitats, carry out agriculture, produce fuel and build all the necessary infrastructure to allow humans to survive in an environment that seeks to kill humans. It requires the robots to run on artificial intelligence that can run on Mars because of the communication lag with Earth. And it requires a lot of money because the technology doesn’t exist yet.

The merger allows Musk to bring all three parts under one roof. xAI itself was heavily in debt and unable to raise the funds to build the AI ​​infrastructure needed for such a colony. SpaceX does not have an artificial intelligence business itself. As the document shows, the idea is that the new company can use Starlink’s revenue plus SpaceX’s launch business to subsidize the construction of artificial intelligence, and use xAI’s technology to truly achieve large-scale governance on Mars.

Who will pay the rest? That’s what an IPO is for. SpaceX’s launch business does not appear to require public capital, with Starlink alone generating more than $11 billion in revenue last year. But the entire Mars supply chain will require more funding than even one profitable rocket company can produce.

Public capital must fund this layer: Starship production will need to be scaled up to deliver millions of tons of cargo to Mars and to produce orbiting artificial intelligence computing satellites, which SpaceX says will begin deploying as early as 2028. S-1 hinted at this throughout, including the stated goal of deploying space-based AI data centers powered by the sun starting in 2028.

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SpaceX claims the total addressable market for this technology is $28.5 trillion, roughly equivalent to the current size of the U.S. economy. Of this amount, $26.5 trillion is invested in artificial intelligence. The space and connectivity businesses that most people typically associate with the company add up to less than $2 trillion.

Whether public market investors would be interested in financing such a high-risk project is another question. Timeline estimates for Mars range from a few decades to forever.

Paul Sutter, a NASA consultant and Johns Hopkins University research scientist, wrote in Scientific American magazine that Musk’s Mars timeline does not match the real plan. “It’s like announcing a camping trip the following weekend without purchasing any camping supplies. And your car is in the store, and it explodes,” Sutter wrote.

In addition, the combined company posted a net loss of $4.3 billion in the first quarter alone, according to the filing. The drag comes almost entirely from xAI, which was folded into SpaceX in a merger in February. The AI ​​unit generated $818 million in revenue but lost $2.5 billion in operations while spending $7.7 billion on capital expenditures — mostly Nvidia GPUs, which the company leased from its own board members. In addition, if you add in the $1.9 billion in accounting charges to pay off xAI’s old debt early, then most of the net loss is SpaceX absorbing xAI’s balance sheet. Starlink and launch businesses remain profitable.

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The prospectus begins with an inscription from Musk himself, above the company’s mission statement:

“You want to wake up in the morning and think that the future is going to be great – that’s what spaceflight civilization is about. It’s about believing in the future and thinking that the future will be better than the past,” he wrote. “I can’t think of anything more exciting than going out and being a star.”

This story originally appeared on Fortune.com

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