(Bloomberg) -- The constellation Monoceros, faintly visible against the Milky Way, has for centuries occupied the heavens as “the unicorn.” The other space unicorn? Elon Musk’s Space Exploration Technologies Corp. The billionaire entrepreneur’s onetime side hustle has, in less than two decades, evolved from a novel idea—reusable rockets—into the most highly valued startup in the US. The $210 billion colossus launches satellites, operates the Starlink internet service and counts itself as a critical NASA subcontractor, ferrying astronauts to the International Space Station. 

Yet investing in SpaceX is anything but simple. The Hawthorne, California-based company remains privately held, which means its shares don’t trade on a stock exchange—not yet anyway. Although that day may come should the company ever go public, for now obtaining a piece of SpaceX (like many unicorns) is not unlike getting past an exclusive club’s velvet rope. Playing hard to get helps create demand and push up the company’s valuation.(1)  

What’s the easiest way to invest in the meantime? Well, you can try asking Musk yourself or landing a job at SpaceX, where you might earn shares(2) as a perk of being a rocket scientist. Or maybe you can find a shareholder who’s vested and willing to sell—a venture capitalist or other wealthy individual who invested in the company’s early days, perhaps, or a former employee. Even if you succeed, this retail-investing mission is about as advanced as it gets. Consider what follows a modest guide for the galaxy’s most determined investors. 

• First of all, do you actually have the money for this journey? Because the only legal way to acquire shares in this type of company is to become what’s known as an accredited investor.(3) US regulators define that as an investor who’s had two consecutive years of earned income above $200,000 (or $300,000 for a married couple) or has a net worth of $1 million (excluding the value of your primary home).(4) Not one of the 24 million American households that meet this threshold? There are still a few ways to gain exposure to SpaceX—just skip ahead to “What to Do When Nobody Wants Your Money.”

• Arranging a purchase from an individual who holds common or preferred stock(5) personally is the most direct route to getting in. How to find such a person? Well, there’s always LinkedIn, but a private wealth manager (think UBS or Morgan Stanley, not Betterment) will have specialists who can find and vet individuals or groups that want to sell shares. Unfortunately, even if you find a willing seller, SpaceX may refuse you. The company doesn’t like adding investors who haven’t been vetted. It’s also a hassle to update the share registry if individuals are trying to trade it like a public stock, so in recent years SpaceX has added provisions restricting whom investors can sell to. This makes shares that don’t have restrictions rarer, and because they aren’t subject to fees as with shares held by a third-party manager, they’re often sold at a premium to the price at time of tender.
• What SpaceX has more difficulty policing are shares held by institutions or individuals in special vehicles. In such arrangements, an investment firm(6) owns and manages a pooled fund, which can contain thousands of shares in a single company such as SpaceX. People can trade their piece without SpaceX knowing, and because people typically hold smaller slices, they’re more numerous (and hence liquid) than an individual’s vested stock. Again, any self-respecting wealth manager will have contacts with access to this type of share, but you’ll typically need to invest at least $100,000(7) to participate. You’ll also need to pay your manager(8) for their efforts.
• Don’t have or don’t want to have (and pay for) a wealth manager? The next option is to create an account on a registered broker-dealer platform such as Hiive or Rainmaker Securities, marketplaces that specialize in the trading of nonpublic securities. These firms vet sellers (who can include individuals with vested shares) on their platforms. You can log in, browse and compare prices and volumes on offer. Having a marketplace helps create transparency on pricing, potentially giving you better value—though, again, you’ll need to have at least six figures to spend and be willing to pay a fee for the service.(9)

What to Do When Nobody Wants Your Money 

• If you’re still watching SpaceX from afar, you’ll need to opt for a less ambitious approach. One option is a diversified fund that includes stakes in the company as part of its portfolio. One of the better-known mutual funds is the Baron Focused Growth Fund (BFGFX).(10) SpaceX accounted for 9.5% of its portfolio as of April 30. The fund requires a minimum purchase of $2,000.(11) Fidelity Investments, another SpaceX backer that’s participated in multiple fundraising rounds, has mutual funds that first acquired shares in 2015.

• Another, newer option is Destiny Tech100, a publicly traded closed-end fund focused on pre-public companies. SpaceX and Sam Altman’s OpenAI make up almost two-fifths of its holdings. Destiny Tech100 trades like a stock, making it easy to buy and sell … but it trades at an enormous premium to its underlying assets, updates the fair value of its holdings on a quarterly basis and has shown extreme volatility.(12) Also, the results so far haven’t been great: The fund started investing in 2021 and had racked up a loss of 34% on its US investments as of December.

• Another unconventional way to tap into SpaceX is to buy shares of publicly traded companies that are suppliers for its rockets and satellites. Mid-caps such as turbo pump maker Graham Corp. and rocket landing leg manufacturer Hunting Plc are among the companies in SpaceX’s supply chain that are poised to piggyback on its growth.

• Have a few hundred dollars to spend rather than a few thousand? A more arm’s-length approach(13) to investing in SpaceX is to acquire shares of highly liquid and publicly traded companies that themselves have ownership stakes. Bank of America Corp. and Google parent Alphabet Inc. have both invested in previous SpaceX funding rounds. Those holdings are a tiny part of their portfolios, however, and are unlikely to be a major catalyst for appreciation in their respective stocks.

• Or maybe just skip SpaceX and settle for an ETF that invests in publicly traded, space-related companies.(14) ARK, Invesco and iShares all offer space-themed ETFs that let investors add a dash of the heavens to their portfolios.

• If all else fails, acquire some SpaceX merch. Shirts go for $30. 

(Updates SpaceX’s valuation. A previous version of this story corrected the name of the Baron mutual fund.)

(1) In June 2024, Bloomberg reported SpaceX plans to sell insider shares at $112 apiece in a tender offer that values the startup at about $210 billion.

(2) A portion of an employee’s shares will typically vest twice a year. Leaving before vesting risks the shares being lost, helping with retention.

(3) Unregistered and, by extension, privately held securities aren’t regulated by the US Securities and Exchange Commission. Only accredited investors can buy them, presumably because they’re sophisticated enough to understand the risks associated with illiquid assets.

(4) A nonaccredited investor who sneaks through these requirements will, in many states, have a right to undo the investment transaction and get refunded. That said, lying about being an accredited investor and providing false financial statements doesn’t go over well with authorities.

(5) Preferred shares are higher priority and likely to retain more value in the event of insolvency and the fire sale of assets. In an initial public offering, the two share types typically convert into the same class of stock.

(6) Private institutions invested in SpaceX have included Valor Equity Partners and Draper Fisher Jurvetson.

(7) SpaceX shares are a hot commodity; the companies and individuals holding them aren’t in the business of nickel-and-dime transactions. Be prepared to drop a six-figure amount to gain access.

(8) The fee will range from 0.1% to 2% of the total transaction.

(9) It’s worth noting that whether you’re using a wealth manager or a platform, completing a deal can take weeks; once a price is set, registration and other documents need to be exchanged and signed. This isn’t like buying a public stock—there’s no standardized clearing process, and in some cases the manager of a share vehicle may refuse a new buyer in favor of an existing backer.

(10) Baron Funds has a total of six retail mutual funds that directly hold shares in the company.

(11) Baron requires a minimum investment of $35,000 to attend its swank annual investment conference at the Metropolitan Opera House in New York, which in the past has featured interviews with Elon Musk.

(12) Sohail Prasad, chief executive officer of the fund’s parent company, Destiny XYZ, told Bloomberg Television that the fund’s volatility is part of a “discovery process” among investors trying to figure out what yet-to-list technology companies are worth. Bloomberg Opinion columnist Matt Levine is skeptical: “[I]f you buy shares in DXYZ, you are getting almost no exposure to Stripe and SpaceX; you are mostly getting exposure to DXYZ’s own premium. More than 90% of the value of the stock is premium; the portfolio is an afterthought.”

(13) And potentially fee-free!

(14) An ETF is a publicly traded fund that tracks an index, in this case companies focused on the space business. ETFs provide exposure to a group of diversified and theoretically lower-risk assets.

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