On August 6, the primary tranche of locked-up SpaceX shares was launched. Roughly 911.5 million shares turned eligible to commerce in a single session.
SPCX went up 6%.
Then it went up once more the following day, closing out a two-day acquire of about 11% on the precise occasion everyone had circled on their calendar because the plunge.
I had circled it too.
The Consensus Was Apparent, And Clearly Fallacious
SpaceX’s public float earlier than that day was about 639 million shares. The unlock added roughly 143% to the tradeable provide in a single day.
Put one other manner, the freely tradable portion of the corporate went from about 4.9% of shares excellent to about 11.8%. The float greater than doubled, from roughly 639 million shares to about 1.55 billion.
Brief curiosity had constructed up in anticipation. Each cheap individual anticipated a flood of vendor to push the inventory worth beneath $100.
The sellers did not present, and I wasn’t in a position to purchase the dip because of this.
Why The SpaceX Sellers Did not Present
The relative ache had already been taken.
Shares IPO’d at $135 on June 11 and spiked above $225 within the first days of buying and selling. Then they fell greater than 50% to shut at $108.27 on August 5, after the corporate’s first public quarterly outcomes.
Each share of that decline was bought by the free float. The locked-up holders could not take part. Solely the roughly 639 million shares that would commerce from day one had been doing any of the harm.
Individuals who might promote spent seven weeks promoting forward of people that could not, and brief sellers piled on prime of them. By August 6, the provision everybody was bracing for had already been front-run.
Then two issues occurred directly.
The shorts had no flood to promote into, so a few of them lined (purchased).
And the newly freed holders opened their screens to a inventory down greater than 50% from its excessive and sitting beneath its IPO worth. For those who’ve held SpaceX privately for a decade with a value foundation within the single digits, you might be in no rush to hit the bid on the native low. You’ve got waited 20 years. You possibly can wait just a few extra weeks or months.
The staggered construction helped too.
SpaceX launched the block in phases slightly than one cliff. About 20% got here free on August 6, tied to first earnings. Smaller tranches comply with each few weeks by October, a bigger launch comes after Q3 earnings, and the remainder of the 180-day block frees up December 8. Elon’s personal block of roughly 6.4 billion shares stays locked till June 2027.
Handed On The IPO, However Owned It Anyway
I did not purchase the IPO. I wrote about why in Dangerous Exit Liquidity: Why I am Passing On The SpaceX IPO. It felt too dangerous at a $1.2 trillion valuation to take a position new cash.
There was additionally a mechanical cause. Constancy, my primary brokerage, enforces a 15-calendar-day holding interval on IPO allocations. Flip inside that window and also you’re banned from IPO participation for six months. Not a commerce I needed to be locked into.
However I already owned SpaceX by a conventional enterprise capital fund. I simply did not know precisely how a lot or when the shares had been bought.
When The Fund Bought SpaceX And At What Worth
Again in 2022 I dedicated $200,000 to a standard enterprise capital fund classic, a 12 months after the mania died down. A fund like that invests many of the capital over a three-year interval, and you do not know precisely what it purchased, how a lot of it, or at what valuation till nicely after the very fact.
The March 31, 2026 capital assertion confirmed SpaceX at 9.5% of the fund and my ending steadiness at $348,549. So a 9.5% place implied about $33,100. That was the extent of my data.
Then the distribution letter arrived on August 7, 2026, with the small print relating to the worth of buy and the date.
The fund purchased SpaceX at $16.20 a share and distributed shares in opposition to a reference worth of $133.11.
That is an 8.2X a number of on invested capital in two years and 9 months. On paper it is a unbelievable return.
Now the half that introduced me again to earth.
Want To Make investments Massive Cash To Make Life-Altering Cash
My first response to the distribution was disappointment. That is it? 92 shares. About $12,250.
That’s roughly what our household spent on 30 days in Honolulu this summer time, together with flights, three weeks of summer time camp, meals, transportation, clothes, and leisure. An entire summer time of reminiscences, or 92 shares of a rocket firm.
Then I remembered the 92 shares are solely 20% of my stake, as a result of the fund can solely distribute what’s truly unlocked. The opposite 368 shares come because the remaining tranches liberate. So my full place is 460 shares, price about $61,200 at that reference worth.
Higher than a poke within the eye. Nonetheless not sufficient to purchase a Tesla Mannequin Y Efficiency out the door at $60,000, since I owe taxes on something I promote.
For context, my largest particular person public holdings are greater than 15X the scale of this place. If SpaceX fell 50% tomorrow, it would not transfer the needle. If this had been a top-five holding, I could trim a bit of based mostly on valuation alone. At $61,200, the mathematics would not justify the tax invoice.
Sadly, it is advisable to make investments huge cash to make life-changing cash. In 2022, I dedicated $400,000 whole to the enterprise capital agency’s two funds: $200,000 to its early stage fund and $200,000 to its progress stage fund, which owns SpaceX shares. I ought to have invested extra as a result of 2022 is popping out to be an important 12 months.
What I am Doing With My SpaceX Shares
The prudent investor in me says promote the 92 and let the remaining 368 journey, since they liberate over the following a number of months anyway. Take some off, keep within the recreation.
The one who would not need to be on the authorities’s leash by paying extra taxes says maintain every thing. The corporate is rising quick, simply raised an infinite quantity of capital, and betting in opposition to Elon has been a dropping commerce for 20 years working.
The sincere reply is that it would not matter. $61,000 would not change my life, not to mention the ~$12,000 I can promote at present earlier than taxes. There’s nothing I need to purchase that money movement cannot cowl, which I proved to myself with a 30-day aggressive $40,000 spending experiment in Hawaii this summer time.
So I am holding. There are lots extra starlink satellites to place into orbit to cowl the world’s demand. The subsequent era of satellites will probably be vastly extra succesful. Demand for AI compute appears insatiable, as AI revolutionizes the world. And possibly there will probably be thrilling new area growth applications sooner or later. I am curious to see how far Elon can take his area enlargement goals.
The entire level of investing in nice companies will not be prematurely exiting a rising area. That precept would not cease making use of simply because the shares lastly confirmed up in my brokerage account. It additionally would not harm that Morgan Stanley has a $300 worth goal with a $600 bull case.
One other Lockup Check With VCX
What’s attention-grabbing concerning the SpaceX case examine is that I ran the identical experiment twice. I invested an analogous quantity in Fundrise’s Innovation Fund at the start of 2023, again when it wasn’t listed, and stored dollar-cost averaging into it till February 2026 as a hedge in opposition to a tough future for my youngsters as a consequence of AI.
Fundrise introduced on July 24 that it was accelerating the lockup expiration on the Innovation Fund (NYSE: VCX) from September 14 to August 13. Beforehand restricted shares grow to be tradeable on August 14.
Roughly 100,000 pre-listing holders with a value foundation within the $10 to $19 vary are about to get liquidity on a inventory that has traded above NAV because it listed. The consensus is that it goes down on the brand new provide.
That’s the similar consensus everybody had about SpaceX on August 6.
I do not know what’s going to occur. What I do know is that the market spent weeks pricing within the SpaceX unlock and acquired the path improper anyway. The premium in VCX has already compressed considerably from its peak, which seems just like the market front-running the occasion, precisely because it did with SPCX.
The form is identical. Rocket up after itemizing, then a slide into the lockup date whereas everyone positions for the flood.
And here is the query long-term buyers need to ask. For those who’ve held VCX for 3 years, are you actually dumping every thing within the 20s and low 30s simply because it’s liquid?
My Plan For VCX Upon Lockup
My plan is to carry what I personal and purchase extra after the lockup if VCX trades beneath my September NAV estimate of $31. I’ve already taken revenue promoting my unrestricted shares when valuations had been aggressive. Proper now, valuations are cheap.
I discover it uncanny that VCX is buying and selling proper round my NAV forecast put out a month in the past, the day earlier than the lockup expires. Perhaps my base case NAV forecast of $45 in 2027 and $60 in 2028 will come true too. Solely time will inform.
The additional it falls beneath $31, the extra I purchase. If it hits $25, I plan to again up the truck. I’ve put aside about $150,000 for the occasion throughout 4 of my portfolios.
The reason being Anthropic, and the potential for retail mania to return. Sitting in San Francisco, watching consumers front-run one another in house bidding wars, and speaking to enterprise capitalists, angel buyers, and other people working contained in the AI labs, my learn is that demand for an Anthropic IPO can be groundbreaking. I put that likelihood at 80%.
I might be improper. 80% will not be 100%. In the meantime, sturdy demand through the Anthropic IPO might curiously not ignite VCX once more, which has greater than 20% of the fund in Anthropic. However I would slightly personal the publicity earlier than the occasion than battle for it on day one with everyone else. Battling for warm IPO shares is a dropping proposition.
It is the identical cause I would slightly purchase my dream San Francisco house earlier than hundreds of AI employees get liquid than bid in opposition to them at an open home.
The newest experiences from the WSJ have Anthropic going public in September or October of 2026. Due to this fact, the timing of this lockup expiration could not be higher.
In the meantime, on August 13, each Bloomberg and The Monetary Instances got here out saying Anthropic is searching for a $2+ trillion IPO valuation based mostly on 20X year-end $100+ billion in anticipated revenues. If that occurs, my base case 2027 NAV estimate of $45 is simply too conservative and my Blue Sky state of affairs is now doubtlessly in play.
My money is able to purchase the dip. And if my recreation plan would not work out, that is simply the way in which issues go along with threat property. At the very least I got here up with a plan and tried.
Full disclosure: I have been a Fundrise affiliate accomplice since 2016 and I personal VCX shares I purchased earlier than it listed. About 5% of VCX is in SpaceX and over 20% is in Anthropic. Danger property can and do lose cash. Please make investments at your personal discretion.
The identical 2022 classic conventional VC fund that held 9.5% of its worth in SpaceX additionally holds 14.3% in Anthropic, as of the March 31, 2026 capital assertion when Anthropic was valued round $360 billion. Which means my share of Anthropic is price about $101,000 at a $960 billion valuation.
My purpose is to personal not less than $500,000 price of Anthropic shares earlier than IPO, which is why I’m a purchaser of VCX right here. As a FIRE investor since 2012, I have to earn funding returns to supply for my household since I don’t have a day job. Consequently, I can’t afford to be too improper.
Reader Questions
For those who personal SpaceX shares, did you promote into the unlock or maintain? What was the deciding issue?
For these holding VCX by August 14, have you ever already determined what you are doing, or are you ready to see the tape?
Have you ever ever obtained an in-kind distribution from a fund and been stunned, in both path, by what truly confirmed up?
Personal The AI Buildout With out A Countdown Clock
Watching a place swing on an earnings print after which swing once more on a lockup date is a reminder of why I preserve a significant chunk of internet price in actual property. Actual property produces earnings, it would not require me to have an opinion by 9:30am, and no person publishes a countdown clock to my rental property’s lockup expiration.
There is a much less apparent overlap with every thing above too. AI runs on compute, and compute has to bodily stay someplace. The hyperscalers are spending lots of of billions a 12 months on knowledge facilities, and each one in every of them wants land, permits, and energy the grid was by no means constructed to ship. The fortunes of the steam period weren’t made on the engine. They had been made on the railroads and metal the engine required.
Fundrise invests in that buildout alongside residential and industrial property in lower-cost areas of the nation. I’ve invested over $300,000 in its actual property product thus far. The funding minimal is $10, so you possibly can take a look at the waters earlier than committing actual capital.
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Cash is simply too essential to be left as much as pontification, which is why I have been writing from firsthand expertise since 2009.
