Bottom Line Up Front: The SpaceX IPO is just around the corner, and I’ve gone on record (and with the internet these days, there is no walking that one back) that I think it is going to be the Most Consequential Financial Transaction of All Time (trademark pending.)
The analogy I keep landing on is the expansion of the railroad system in 19th century America. New territories, new businesses, new structures, new ways of thinking about what exactly is possible.
I’d like to make the argument that we are, right now, in approximately 1870 for the space economy.
In May 1869, Leland Stanford drove a ceremonial golden spike into the ground at Promontory Summit, Utah, completing the first transcontinental railroad. A telegraph operator tapped out a single word to a waiting nation: Done.
The country erupted. Cannons fired in New York. Bells rang in San Francisco. Two locomotives sat nose-to-nose in the Utah desert while men in stovepipe hats shook hands for the photographers. It remains one of the most iconic images in American history.
What the Central Pacific and Union Pacific pulled off — 1,776 miles of track across desert, mountain, and plains in just six years — was an audacious feat of engineering, logistics, and sheer stubbornness. The men who built that line weren’t just capitalists chasing a land grant. They were doing something that had never been done before, under conditions that made everyone around them say it couldn’t be done, and yet they did it anyway.
The transcontinental railroad is one of the great achievements that made America what it is today. Full stop.
But, as they say, the rest of the story is so much more than just that moment.
Spurs, Depots, and the (more than) Occasional Whorehouse
The trunk line builders were rightfully celebrated. Then (critical to this tortured analogy,) the ecosystem exploded and things really started to happen.
Within five years of the golden spike, 35,000 miles of additional track had been laid across the country, most of it short-run, regional, and aggressively specialized. Cattle lines running north out of Texas. Grain spurs connecting Kansas wheat fields to Chicago elevators. Mountain lines built specifically to haul Colorado silver. Passenger spurs running tourists into Yellowstone.
Then the second order effects: depot hotels, coal yards, telegraph offices strung alongside every major line, refrigerated car companies, specialized freight forwarders who understood the difference between moving livestock and moving dry goods. The water towers that let steam engines refuel across the Nevada desert. The brothels and gambling halls in Abilene and Dodge City and Amarillo — not romantic in the traditional sense, but economically rational expressions of a service sector finding its natural position alongside a major transit corridor.
The men who drove the golden spike became famous. The men who got rich were mostly the ones who looked at the completed trunk line and asked — okay, now what does that make possible that wasn’t possible before?
What SpaceX Actually Built
Let me be precise here, because I’ve seen too many analysts get this wrong in both directions.
SpaceX is the Central Pacific and Union Pacific combined, with better financial discipline and a generational management team. What Elon Musk and the team at Boca Chica have built isn’t just impressive: it’s the fundamental prerequisite.
Falcon 9’s reusability cracked open the economics of orbital access in a way that forty years of government launch programs couldn’t. Starship, if it delivers on its engineering promise, will do the same for heavy-lift. Starlink is a functioning orbital infrastructure business generating real revenue at real scale.
SpaceX has officially driven the proverbial golden spike.
The vertical integration that made SpaceX possible was a founding condition, not a universal market law. When you’re trying to do something that has never been done before — when every supplier quotes you parts that cost 50x what they should, when no one will give you a launch slot because you’re an unproven startup, when the entire incumbent industry has every incentive to watch you fail — you bring it all in-house or you don’t get off the ground. SpaceX had to own the stack or else it didn’t stand a chance.
This is a point that some of SpaceX’s competitors would benefit from internalizing. The launch market is effectively closed to new entrants. The U.S. government will maintain one or two additional providers for strategic redundancy, but the window for building a competing launch business from scratch is about as open as the window for laying new transcontinental track in 1875.
The window for launch-at-scale companies is gone.
What’s open now is pretty much everything else.
The Four Spurs Nobody Has Built Yet
When I look at the emerging space economy, I see the same infrastructure gap that existed in 1870 and the same opportunity hiding inside it.
Earth Launch: The most mature layer, and it’s already bifurcating into a SpaceX-dominant market with a handful of strategic alternatives. Rocket Lab has carved out a real niche in the small-sat market. Blue Origin persists as systemic obsessive billionaire-redundancy. This layer is largely spoken for.
Orbital Way Stations: These don’t really exist yet. There is no there between the launch vehicle and the final destination: no refueling infrastructure, no cargo transfer facilities, no crew handoff stations. The equivalent of the water towers and coal depots that made transcontinental rail practically possible. Someone is going to build this. It shouldn’t (but I won’t say it won’t) be SpaceX, because SpaceX is busy driving the locomotive, not stacking coal.
Cislunar Transfer: The corridor between Earth orbit and the Moon is the 19th century’s Kansas City: the junction point where value aggregates. Whoever controls the cislunar logistics layer controls access pricing to an entire economic zone. This is not a SpaceX problem to solve. It’s a spur someone can specialize in, excel at, and economically dominate without having to be perfect at everything else (most of which is pretty much impossible to begin with).
Lunar Surface Operations: Think what cattle towns were to the Texas ranching economy. The infrastructure that makes the resource valuable after it arrives. Habitation, power, in-situ resource utilization (extracting water ice and using it as propellant,) surface mobility. The actual doing of things on the Moon. Domain specialist opportunities, every one of them.
Deep Space Infrastructure: Mars, the asteroid belt, the broader architecture of human expansion beyond the Earth-Moon system is the frontier that makes the whole thesis make sense. The transcontinental railroad didn’t just move beef from Texas to New York. It opened the American West as a civilizational project.
The space economy isn’t ultimately about satellites and government contracts. It’s about the expansion of the human species, the diversification of our civilizational risk, and the material abundance that comes from accessing resources that make Earth’s entire mineral wealth look like a rounding error.
That last paragraph sounds like science fiction. I am aware of this. I also note that “a railroad from Missouri to Sacramento” sounded like science fiction in 1850, and someone drove the spike nineteen years later.
A Brief Detour Into a Counterargument I Find Unpersuasive
Peter Beck, the CEO of Rocket Lab, has argued publicly that serious space application companies need to own their own rockets. His thesis: controlling your own launch is a strategic necessity, a competitive moat, a mark of seriousness.
I’d push back on this. Rocket Lab’s success is genuine and hard-won. Beck built something real, and the Electron rocket is a legitimate achievement. But the lesson he’s drawing is a company-specific insight being extrapolated into universal market law, and it doesn’t survive first contact.
Investing in a years-(decades?) long effort to secure your own launch capacity ignores the inevitably rapid expansion of launch capacity in the near future. By the time anyone new actually self-achieves consistent, safe, reusable capacity, SpaceX (and Rocket Lab, I might add), will have dumped so much available mass-lift capacity into the market — launch commoditization being a core underpinning of the future of the industry — that it will have proven a fruitless endeavor, not to mention a massive diversion of capital from new opportunities.
The cattle town operators in Abilene didn’t need to own the Union Pacific to build profitable businesses. They needed to understand the train schedule. The refrigerated car companies didn’t need to own the locomotive, they needed to own the refrigeration. The grain elevator operators in Chicago didn’t need to lay their own track. They needed to be at the junction.
Owning launch is a legitimate strategy for Rocket Lab, which is in the launch business. For a domain specialist in, say, cislunar logistics or orbital manufacturing or lunar surface operations, trying to also own launch is a distraction from your actual competitive advantage, a massive capital expenditure with no strategic payoff, and an invitation to fight SpaceX on terrain where SpaceX has a twenty-year head start.
The Most Consequential Financial Transaction in Human History
Here’s the part that I think most financial analysts are missing entirely.
When SpaceX goes public, it won’t just be a large technology IPO. It will signal the creation of a truly institutionally investable asset class, one that will enable real money to be invested in the future of humanity.
Right now, the space economy is either venture-backed early-stage companies or supported by government contracts — usually both. There is no true index. There is no benchmark. There is no way for a pension fund or a sovereign wealth fund to get meaningful exposure to the sector without bespoke direct investment.
And most of them can’t do bespoke direct investment at scale. So they don’t.
The SpaceX IPO changes that. It gives every institutional allocator on earth a way to directly measure the projected/expected returns of investing in the space economy. Hold times, entry points, exit horizons, IRRs — everything an allocator needs to be able to bucket an investment into an existing portfolio, or create a stand-alone diversifying sleeve with a specific return profile.
The moment that happens, the capital flows into the sector don’t just increase — they multiply. Pension funds. Sovereign wealth funds. Insurance company investment portfolios. University endowments. The entire apparatus of global institutional capital, which has, on balance, been sitting on the sidelines of the space economy because there was nowhere to put it while staying on the right side of their fiduciary obligations or their current portfolio paradigms.
The spur builders in 1875 weren’t just benefiting from the existence of the trunk line. They were benefiting from the entire financial infrastructure that the transcontinental railroad had legitimized. Banks that had learned to evaluate railroad risk. Investors who had learned to think about infrastructure returns. A market for railroad bonds that didn’t exist a generation earlier.
That is what SpaceX’s public market debut unlocks for the space economy. And that’s why I’d argue it’s not just a large IPO. It might be the most consequential single financial transaction in human history, not because of SpaceX’s perceived value, but because of what it makes possible downstream.
Money now, Humanity later
This is the part that sounds crazy, but I’m going to say it anyway.
“The expansion of the human species” is the kind of phrase that sounds perfectly normal at a space conference and slightly unhinged at a dinner party (or on my regularly scheduled, highly relevant Predator-meme laced LinkedIn feed), but consider the alternative framing: every meaningful species/human civilization has, at some point, faced an existential concentration risk. All the eggs, one basket — one asteroid, one pandemic, one bad century.
The American West wasn’t settled because Thomas Jefferson thought Manifest Destiny sounded poetic. It was settled because land meant food, food meant survival, and survival meant you got to have opinions about all sorts of other things later on.
The math hasn’t changed. The basket has just gotten more sophisticated. Diversifying civilizational risk across more than one planet isn’t science fiction — it’s our only real choice. That is, unless we are just resigned to dying off one day for some reason that will look totally ridiculous in hindsight (…as if there would be anyone left to have hindsight. Which, by definition, there won’t.)
So yeah – if the SpaceX IPO unlocks serious capital for the sector and hands the stars to our grandchildren, I’m more comfortable on my soapbox. Suck it, finance nerds.
So. 1870. Now What?
If you’re an investor looking at the space economy right now, here’s my honest assessment: the trunk line is built. You missed the trunk line. Or rather, you never had a clean way to invest in it while it was being constructed, and you still mostly don’t. That window is closed.
What’s open is the spur economy. The domain specialists. The infrastructure layers. The companies that are looking at the completed trunk line and asking the right question.
The right question, for the record, is not “how do we build a better rocket?” The right question is: given that the rocket problem is largely solved, what becomes possible that wasn’t possible before?
The answer to that question is a multi-decade, multi-trillion dollar infrastructure buildout that will make the post-1869 American rail expansion look like a permit application.
The spike is in. The hard part — the genuinely heroic, audacious, historic part — has been done by people who deserve every accolade they’ve received and more.
Now comes the part where everyone else gets rich.
And space brothels.
