After being merged with Elon Musk’s AI startup xAI, SpaceX is gearing up for a $1.25 trillion IPO — but since the entity is still currently private, it’s remained mostly out of reach of everyday investors.
But Powerlaw Corp, a fund that owns stakes in buzzy and not-yet-public companies including SpaceX, OpenAI, and Anthropic, is giving retail traders an early taste of what could be in store for them. As Bloomberg reports, the $1.2 billion fund announced in a regulatory filing that it’s looking to give mom-and-pop investors a shot at buying in.
“With the pool of capital in private markets, the best companies are not choosing to go public,” Powerlaw investor and Jazz Venture Partners managing partner John Spinale told Bloomberg. “This robs the public the ability to access the high-growth firms.”
Powerlaw will act as the intermediary and charge shareholders a 2.5 percent management fee. The fund is planning for a direct listing, meaning that it will sell existing shares by current stockholders, unlike an IPO, which involves selling new shares to raise capital.
However, the fund will still need approval from the US Securities and Exchange Commission before it can go ahead.
“Our investment objective is long-term capital appreciation,” the regulatory filing reads. “We seek to achieve our investment objective by investing in a concentrated portfolio of approximately 15 late-stage technology companies.”
Powerlaw’s portfolio includes six AI companies, including xAI, Perplexity, OpenAI, and Anthropic, as well as predictions market platform Kalshi, and even Palmer Luckey’s defense contractor Anduril.
“The fund reflects [parent company] Akkadian’s mission to democratize access to Silicon Valley’s premier technology investments,” the filing reads.
But taking advantage of the service could come with risks. For one, shareholders may not see immediate gains when share prices of these companies rise due to the way Powerlaw structures its trades. Closed-end funds also routinely trade at a significant premium to their actual holdings.
Information could also be hard to come by as privately traded companies like SpaceX and OpenAI aren’t required to disclose financial statements publicly. And a more prosaic possibility: these hype-fueled stocks could eventually crash for a variety of reasons.
And a similar investment platform, called Linqto, which aimed to allow accredited investors to invest in private and pre-IPO companies, filed for bankruptcy in July of last year after facing alleged security violations, further highlighting the inherent risks of trying to invest in private companies through an intermediary.
More on SpaceX: SpaceX Just Bought Elon Musk’s CSAM Company
The post Buckle Up: New Fund Will Let Regular Investors Buy SpaceX Stock appeared first on Futurism.
