The biggest IPO in history is reserving 30% for retail. Standard IPO practice is 5-10%.

SpaceX is planning to raise up to $75 billion at a $2 trillion valuation, per Bloomberg. CFO Bret Johnsen said, "retail is going to be a critical part of this and a bigger part than any IPO in history."

On March 31, OpenAI announced the closing of their $122 billion round, $3 billion of which went directly to individual investors. They also announced ARK Invest ETF's participation, giving any brokerage account holder indirect exposure to OpenAI.

Is it a coincidence that in the same week the two most valuable private companies in the world make deliberate moves to expand access to retail investors?

No. It's an ongoing trend, and happening from every angle of capital markets:

- Retail access funds: Robinhood, Powerlaw, Destiny, Fundrise, ARK have launched vehicles holding SpaceX, OpenAI, Anthropic, and others.

- Brokerage infrastructure: Goldman acquired Industry Ventures. Morgan Stanley acquired EquityZen. Charles Schwab acquired Forge. Big bets that retail demand for private markets justifies acquired rails.

- Direct private funding round allocations: Private company cap tables are opening up to retail participation via wealth management platforms, and sometimes direct offerings!

What changed?

The companies seem to have decided they want retail investors.

SpaceX wants loyal holders who won't flip on day one. The diamond hands that made Tesla and Palantir cult stocks. And at a ~$2 trillion valuation, maybe institutional investors ask too many questions? Big assumptions are required to model a return at that entry point. Retail invests on a different calculus: belief in the mission, vibes.

Is this a good thing?

The private markets being open only to accredited investors, and having friction to complete trades, act as safety mechanisms. 30% of SpaceX's float is roughly $22 billion hitting the retail market immediately. That's a lot of stock dropping into retail hands after private market value creation has already worked its magic.

What do you think?


Disclaimer: This communication is for informational purposes only and does not constitute an offer or solicitation to buy or sell any securities or investment products. Consult with your financial advisor or an investment professional before making any investment decisions. Past performance is not indicative of future returns. Investments in private companies are illiquid, as there is a limited secondary market for private company shares.