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| The Daily Pitch |
| PE, VC and M&A |
| Your edge on global private capital markets |
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| New avenues for investing in private markets are emerging. PitchBook's Late Stage Research helps investors evaluate opportunities among leading private companies expected to go public. PitchBook's Institutional Research Group is featuring SpaceX for the first report in the series, which will cover other major startups such as OpenAI and Anduril. |
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| SpaceX's astronomical IPO valuation: Not so crazy—under certain conditions |
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By Franco Granda, Senior Research Analyst, Private Company Coverage
SpaceX's proposed $1.5 trillion IPO valuation is not as absurd as it may sound, with a sum-of-the-parts analysis of its space launch and satellite businesses placing the company's fair value in the range of $1.1 trillion to $1.7 trillion, according to new PitchBook research.
The challenge for investors ahead of the listing is that SpaceX has never filed a public financial statement, yet it is preparing to go public in what would be the largest offering in history, looking to raise as much as $50 billion, according to news reports. So investors are tasked with valuing a company with bold business projections based on limited information about its books.
PitchBook estimates that SpaceX generated roughly $16 billion in revenue and $7.5 billion in EBITDA in 2025, with Starlink, its satellite internet business, accounting for over two-thirds of the top line at a 50%-plus EBITDA margin. Starlink's direct-to-cellphone service shifted from a network carrier-dependent roaming service to a spectrum-owning platform following SpaceX's $19.6 billion acquisition of EchoStar's wireless licenses—a purchase that exceeded SpaceX's entire 2025 revenue.
By 2040, PitchBook forecasts revenues of $150 billion and EBITDA of $95 billion, driven by Starlink's subscriber base growing toward 1.2 billion and Starship reaching a rocket launch cadence of more than once per day. At commercial scale, Starship would reduce the cost of deploying satellite capacity by roughly 70%. |
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As such, to justify paying nearly 95x 2025 estimated revenues (or 10x 2040 estimates), investors will need to keep strict tabs on the timing of Starship coming to market and on the ramp-up of Starlink service direct to cellphones.
The proposed $1.5 trillion valuation is defensible over a five- to seven-year horizon, but returns are tied to execution milestones rather than near-term earnings growth. Tesla had a similar trajectory as a public company, where its stock price moved based on production milestones long before the business fundamentals caught up to the multiple.
SpaceX recently acquired xAI, valued at roughly $250 billion in an all-stock deal. While it did broaden the company's narrative as a "AI plus space infrastructure platform" ahead of the IPO, the move also adds business integration complexity that's difficult to underwrite.
So as SpaceX plows ahead with its IPO plans, the aspirational growth initiatives it plans to fund with the proceeds—data centers in space and Moonbase Alpha, a self-sustaining lunar city—face challenges that make their near-term planning equally aspirational. |
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| Private Equity and the Future of Manufacturing: Exclusive Report |
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Featuring data from PitchBook, get insights into top manufacturing and private equity trends for 2026.
Access the report. |
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• Conflict between Iran, the US and US-ally Israel upends regional security, jolting oil markets and eroding confidence. For private markets, the ripple effects will be many. View our analysis
• Changes in consumer demand driven by GLP-1 use continued to reshape PE investment in the packaged foods industry in 2025, even as overall funding for the sector declined. Read the report
• Just out: Our Q4 valuations data for public companies in the medtech sector. See the data |
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| AES take-private frees it to power 'lumpy' data center demand |
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| The AES Corp. is targeting data center-fueled expansion. (Myung J. Chun/Getty Images) |
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By Jessica Hamlin, Senior Funds Columnist
Power behemoth The AES Corp. wants a shot at unbridled, data center-fueled expansion. To pull it off, the company has decided it must give up its spot on the NYSE.
A consortium of investors, including Swedish PE firm EQT, BlackRock's Global Infrastructure Partners, Calpers and the Qatar Investment Authority, agreed to take AES private Monday in an all-cash transaction.
The investor group plans to acquire Arlington, VA-based AES at $15 per share, representing a total equity value of $10.7 billion and an enterprise valuation of $33.4 billion, including assumed debt.
AES is a global power and utilities company that owns and operates 152 power generation facilities and six utility companies.
Over the past five years, the company's average project size has grown by more than 50%, driven by demand for power from new data centers, according to the company's most recent earnings report. Since its inception, the company has signed power purchase agreements with data center providers that require it to produce around 8.2 gigawatts' worth of power now and in the future.
"These are projects that are in high demand," Stephen Coughlin, chief financial officer at AES, said in the company's most recent earnings call Nov. 5. "The time to power is extremely important."
The company operates across four business units organized by technology: renewables, such as solar and wind generation; utilities; energy infrastructure, such as oil and natural gas; and "new energy technologies." The last bucket includes projects like the company's joint ownership of Fluence Energy, which makes energy storage systems.
As Coughlin alluded to in the company's final earnings call, revenues from such projects are "lumpy" in nature. This has not been well received by public stock pickers, who tend to put a high price on businesses with consistent, easy-to-model cash flows.
Without the consortium's offer, AES would likely have had to reduce or eliminate its dividend and halt new equity issuances, Jay Morse, chairman of the company's board of directors, said in a joint statement.
AES shares dropped sharply Monday amid the news, with retail investors likely disappointed with the offer price. Last week, shares were trading around $17. |
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Smart reads that caught our eye.
• SEC filings tell the true story behind OpenAI's $110 billion round. "On day one the actual cash committed was zero," writes investor and journalist Om Malik. [Om]
• Geopolitical shifts are helping revive European tech by drawing more talent, capital and strategic urgency to the continent. [The Economist]
• After air strikes weakened Iran’s leadership, decentralized proxy hackers are launching unpredictable cyberattacks, creating sustained risks for US companies. [ | | | | | | | |
