Musk's SpaceX Raises $500M As Valuation Nears $30.5B

Elon Musk needs a boost to launch SpaceX’s internet-service business, according to a Wall Street Journal report. The firm is raising $500 million from existing investors and major Tesla Inc TSLA shareholder Baillie Gifford to propel its valuation to $30.5 billion.

What To Know

SpaceX will add to its previous $2 billion in equity funding shortly after raising $250 million in last month’s loan sale. The new stock is valued at $186 per share — up 10 percent from the April raise, according to the Wall Street Journal.

News of the raise follows a Monday report that Musk has been using SpaceX employees and equipment for his Boring Company without Board authorization. The diversion of resources was said to initially alarm SpaceX investors, including Peter Thiel’s Founders Fund, who questioned Musk’s use of company assets for inevitably private gain.

The Boring Company has since compensated SpaceX, and Founders Fund said it had “no concerns whatsoever” on the firms’ relationship.

Why It’s Important

SpaceX faces heightened competition in the private space race, with four distinct entities launching rockets Tuesday and Richard Branson’s Virgin Galactic demonstrating last week how close it's come to advancing commercial space travel.

With Musk’s contender requiring additional investment and commitment, some analysts suspect Musk may shift greater focus to his flight venture — either making it his sole focus or seeking to blend its assets with others under Musk’s leadership. Either outcome has significant implications for Tesla, which some say would be better off with new management.

While SpaceX has settled financing terms with investors, it has not yet received the funds. The firm could announce the arrangement by the end of the year.

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