Today's number: 12. That's how many tons of KitKats someone stole from a truck in Europe last week. That's more than 400,000 candy bars. Ed, I actually identify as chocolate. My pronouns are her and she.
Took a while. Right. Actually, Ed, maybe we'll get this one a little faster. Although, who knows? With that Princeton degree in classics, I'm mad at it. Anyways, no. No. Sorry.
One joke. One joke. Come on. Why do we always have to do three jokes?
What does the crowd want? The crowd wants more dog humor.
Oh, is that what they want?
I'm at therapy with my partner and my partner starts bitching that I can't even answer the most simple questions. And the therapist looks at me and says, 'What does she mean?' And I said, 'Uh, that's a feminine pronoun.'
Think about it. It's coming. There it is. Now we get it.
Got it. Got it pretty quick.
Almost up to Cal State Northridge level IQ from Princeton. By the way, CSUN, I feel bad now. That's an insult to CSUN. CSUN is an amazing university. The Cal State system, Ed, is really the crown jewel of California. I used to think it was the University of California. Nah, it's really the Cal State system. I've gone way off script. How are you, Ed?
Well, it's a very exciting day, Scott, because this is officially our first episode on the new Prof G Markets YouTube channel. We wanted to make it easier for everyone to find and subscribe directly to all of our markets content in one place. We thought that the Property Pod channel was getting a little bit cluttered. So from now on, if you're watching on YouTube, this is where we will be. We will be posting every day with the stories that are moving the markets. So please hit subscribe so that you don't miss what matters. We would love to have you with us. Scott, how are you feeling about our new channel?
I'm super excited. And if you like what you hear, please just right now do us a favor and hit subscribe. And also, there's really a secondary benefit here because Ed's feeling a little bit, quite frankly, Ed's feeling a little bit insecure because, as you probably heard, pretty much every podcast in the portfolio was nominated for a Webby.
Let me think. No Mercy, No Malice was nominated for best newsletter, best thought leadership. Raging Moderates, best news and politics. Pivot, best tech and business. And let me see, Prof G Markets was nominated for... Yep. So Ed is feeling a little insecure.
So what do you think that's about? What do you think that's about? I mean, you should be feeling insecure too, because it's also your show, but what do you think that's about? Why did we not get nominated? What is that?
I have absolutely no idea how these award shows figure out who gets nominated and why. All I know is there's about 700 million categories and it costs money to enter. It's a total grift. I mean, I can't wait to accept the award. I mean, if we're really going to be honest, I think what's gone on here is pretty transparent in that with you turning 27 and Claire turning 28, everyone just decided you're over the hill and they need to turn to younger nominees.
That could be true. I like that.
Kara Swisher, I don't know if you know this, I have another podcast and a co-host, Kara Swisher. She's literally getting every lifetime achievement award in the world right now. And I'm like, you know, that just means everyone thinks you're dying soon. She's getting all these lifetime achievement awards from all these different, you know, German Shepherd owners of Maine lifetime achievement award. She's good at knowing all the people who run these things. That's what I need to get better at. I need to show up and meet the people who are on the committees and go rub elbows with the people who run establishment media. I need to up my appearances on the mainstream cable news networks. I need to get really, really in bed with the establishment. And once they know that, and once they know I'm their friend, that's when we'll start winning some awards.
Yeah, I think you can pull that off. You're just going to have to become substantially more interesting a person. But I think that's... you're a cisgender white dude from Princeton who just turned 27. That's not like, 'God, I want to meet him.'
Hey, we can be cool, too.
Yeah, we don't check very many boxes.
May I launch us into this show?
What the hell? Let's do it.
Okay. Today, we're discussing the biggest unanswered questions in the markets right now, the SpaceX IPO, and losers in the sneaker wars. Let's start with our first story. It feels like one of the most uncertain market environments in years right now. Not because of what we know, but because of how much we don't know. There are a number of huge open-ended questions with massive implications, from what happens next in Iran to how AI ultimately reshapes the economy. And the challenge is these are the kinds of forces that can materially move markets. And no one has clear answers. So Scott, let's walk through some of the biggest questions out there and try to figure out what investors should actually be doing in an environment like this. We probably have to start with the Iran question. I mean, what we saw on Wednesday when Trump made his speech at 9:00 p.m., people were thinking that he was going to say something that made it sound like we were going to get out of Iran in some capacity or that we were winding things down. He kind of said that but also not really. He also seemed to double down and say that we were going to get more aggressive but that we're going to do it over two to three weeks. It wasn't the kind of speech that markets really wanted to hear. And then what did we see? We saw an immediate drop in S&P futures right when he made that speech. And then we saw oil surging way back up again. And this is just another example of the uncertainty in the markets right now around this Iran question where we're basically just waiting for what is Trump going to say. We've had many, many instances of this. We had back on March 9th when Trump said, 'I think the war is very complete,' and then the markets went up. And then a few days later he said more negative things. He said, 'We don't even know their leaders. We don't know who we're dealing with.' Markets went down. Then he says that we're having very good and productive talks with Iran. Markets go up. Then Iran says, 'No, those talks didn't happen.' Markets go down. We are essentially being whipsawed back and forth because of the huge, huge weight of this war and what it could do to global markets and to global economies.
And no one really knows what to do. So we're just kind of following the president's lead here. What do you make first of the market's reactions to what's been happening on the Iran front?
I think that the president has no fidelity to the lives of servicemen and service women, to the markets more broadly. I think that we're in the midst of what will be seen as the greatest financial scandal in history where we're using the US military, our geopolitical currency globally, our allies, relationships with our allies, all as a means of creating volatility such that the president can engage in insider trading. I think a good autocrat not only punishes his enemies, which is more difficult with a court system in the US. You can do it to a certain extent. You can put Dario and Moe's firm on a supply chain risk list and make it very difficult for them to do business, but you can't have them thrown out of a window like Putin does in Russia with people he doesn't like. So, what he turns to is more what Putin does on the upside, and that is he carves up US assets and gives them to people loyal to him, inspiring a great deal of loyalty. People are sort of like, 'Okay, I sort of buy into many of his policies, but you know, everyone's getting rich but me. I'm going to get rich and just kiss his ass and maybe he'll give me a defense contract I don't deserve, a government contract I don't deserve, buy a golden share in my company when I'm failing to compete, Intel, whatever it might be.' And if I go along, get along, he'll make me much, much richer. And the ultimate example of that, the most corrupt one, where he will be in front of a camera and a jury in three to five years, maybe more like five to seven, pretending to be really old and that he doesn't remember, he is giving so much information to people about what he is about to say, not about to say about the war in Iran, because every time he has anything resembling a cogent date around the end or even a strategy here, the markets surge and oil drops. And then when he comes out with this word salad of 'I'm going to bomb them to the Stone Age' or 'it's over when I feel it in my bones' or there's reports of amphibious vehicles and another 200 Marines deploying to the region, the markets plummet. And as evidenced by tons of reporting here, there is massive options activity before he makes these announcements. So clearly word is leaking out. He knows it's leaking out. He could have secure phones. He could be 100% in a secure location. Instead, he's obviously leaking this information on purpose to his friends and family. And we have never seen this kind of... and it's not the insider trading that is so upsetting. That's criminal. What's upsetting is he's using our military, our tax dollars, the death and destruction of other people and US service members' lives as pawns in what is, I believe, the greatest insider trading scheme in history. And I believe that's going to slowly but surely unfold. I realize I'm on a bit of a rant here, but bear with me.
I've said for a while that one of the most dangerous things about America and income inequality, which I think is our biggest problem, is the 0.1% no longer are vested in the success of America. What do I mean by that? The 0.1% have their own transportation. They don't give a fuck about four-hour TSA lines. They go to Teterboro. They have their own planes. They don't have security. They have their own police forces. They live in buildings in neighborhoods that have incredible security and doormen so you always feel safe. They have their own health care. There's no waiting in line. They have concierge health care systems. They get whatever they want. They have the best health care in the world. So what is their vested interest? If the people have the 40% of Americans who have medical or dental debt, they can't relate to not being able to take care of your parents. They can't relate to it. They have been removed from what it is to be in America. And the same thing is happening on a larger level with America. And that is as we break free, we are actually removed from the global economy in the short run. I believe in the long run we'll pay a huge price. But if you look at the global markets and some of our allies, their stock markets are down more than ours because we are blessed with energy independence, food independence, and when there's a flight to safety, America is sort of a Giffen good. And this is something you learn in economics and that is in Ireland when potatoes got more expensive, their demand went up because it crowded out expenditure or consumer income you could spend on beef or chicken. So you were poor, so you had to buy more potatoes because you couldn't afford. And I wonder if America has become the ultimate Giffen good and removed from the vested interest of the global well-being of the West because quite frankly for a lot of reasons that aren't our fault, when there's danger, when there's insecurity, there's a flight to US stocks and we are somewhat immune and don't have the same vested interest in the global health, just the same way the 0.1% are no longer invested in the health of America.
Just to your point on the inequality problem, the fact that so many of, I mean, the wealthiest Americans don't seem to have a vested interest in America, I think it is reflected in so many of the comments that we've seen from the administration, which has mostly been stacked with a bunch of really rich people, mostly former businessmen who made a ton of money. Someone like Scott Bessent who got on stage and talked about how Americans want to buy their fourth, fifth, and sixth houses. Like that right there is the perfect example of what you're describing. It's hard to create policies that make sense for regular Americans when your entire worldview is shaped by the experiences of the top 0.01% of Americans and that shapes your entire worldview and that seems to be the kinds of people who are in office right now, which might explain why some of these policies have been so far skewed in favor of the richest. But just to go back to the market's response and what we've seen with Iran so far, I mean, it's clear that there's no way to understand what Trump's agenda actually is. Like there's no rule. There's no strategy. There's no framework you can really use. We used to think it was TACO. Like Trump does something and then the markets tell him off and then he stops doing it. But we've seen a lot of moments where the TACO actually hasn't materialized. And so it's starting to get to the point where there might actually be no way to predict or explain what he's going to do, including with this speech. And I'm sure this is something that a lot of the people within the administration get very, very upset about and get very annoyed about. They're probably trying to create a strategy, create an agenda, and then he just turns on it. An example would be what is going on in the communications between the CIA and Trump. One thing you didn't mention, which they seemed to not see eye to eye on and they had no explanation for. The CIA said that Iran was not an imminent threat and they said that their nuclear capabilities had been eviscerated. That was their statement. That was their position. And then Trump comes out and says, 'Why are we doing this?' Because they are an imminent threat and because their nuclear capabilities are rising and because we need to neutralize it. That was a fundamental disagreement between the CIA and Trump, which leaves us with basically zero understanding of what the hell is even going on here. And so as an investor, it makes things very, very difficult because there actually aren't... I mean, the job of the investor is to try to understand what the future might generally look like and then build a thesis, build an investment thesis around that understanding of the future. The trouble is that there is just no way to predict it at this point because this guy is so erratic. Not even his aides, not even his CIA can predict what he's going to do or say. And the trouble is he's having influence over some of the most important, significant market-moving events in history. I mean, how he responds to this war, how his thought process and strategy materializes will literally move trillions of dollars. It will reverberate not just for years, but for decades. It could completely roll the oil markets for a very, very long time. And the job of the investor is to try to figure out where do I stand on this. I think investors look at what's happening with Iran, they throw their hands up, they say, 'We have no fucking clue.' So, what will we do? We'll just kind of follow what he says, see what happens, and then kind of play it by ear. But what compounds onto this problem, and this is why I believe we are in the most uncertain investment environment in many years, probably since COVID, is it's not just Iran that is a big question, but there's also the AI question, which people don't know what to do with. Will AI destroy the labor market or will it not? Will it be less powerful than people think, i.e., it's a bubble? That's what some people said. Or will it be more powerful than people think, i.e., it will destroy things like software and that's why we're seeing software getting crushed. And again, the markets are just responding to little stimuli that they see every now and then, such as Satya Nadella's research. Some guy on Twitter posts a viral AI blog post and then suddenly $300 billion in market value is erased overnight because investors go, 'I don't know, maybe he's right. Maybe we should sell.' And that becomes a problem. And then I'll just keep going here. There are several other giant questions that no one really knows the answer to at all. Another one would be this potential looming crisis in private credit. Are we going to have a private credit meltdown? Has the industry issued too many bad loans, especially in the software industry? And are we about to experience a credit crunch in what is now a $2 trillion industry? That is another giant question. And in my interview with John Mauldin, something he said off mic, which I think is very true, is he said, 'If this were any other year, all we would be talking about right now is private credit.' That would be the number one issue on every investor's mind. But that's not the number one issue because we've also got oil. We've got potentially the inflationary effects of Iran. What might that do to interest rates? People thought that we were going into a rate-cutting cycle. Now, it appears that we're starting to price things a little differently. People think we won't have any rate cuts this year. And in fact, the chances of a rate hike over the next 12 months have exploded, which means, I mean, this is all to say, no one knows what the fuck is going on right now. I mean, no one has any conviction in their positions because you can't have any conviction. There's no way to really game out the future. And unlike previous questions where it's maybe been limited to one or two industries, all of these questions affect literally everything, everyone's lives, everyone's business, which is why I believe it's an interesting moment right now. Uncertainty is extremely high. Tail risks are all over the place. And I think that leaves us with an important question, like what are you supposed to do in that environment? I'm not entirely sure yet, but that is certainly the question that I'm starting to approach.
I'm fairly confident advising people what to do in an environment like this, and that is simple: nothing. Because when you do something, you're trying to time the market, and that is near impossible. And I learned this the hard way when Trump was elected in 2016. I thought, 'This guy's such a fucking idiot. We just elected a reality show host who has bankrupted almost every company he started, is a rich kid who's managed to turn whatever it was, three or $500 million of his dad's money, into zero a couple times.' I thought, 'This guy doesn't understand the economy. He's reckless. Markets are going to just crash.' And I sold everything and I had some gains. So, I had to pay capital gains. And then six months later, the markets were ripping and I had to buy back in at a higher price. I lost 30 or 40% of my net worth by having an emotional reaction to the markets. And the markets have separated from your emotions and to a certain extent from what's going on in the world. Year to date, the Dow's down 5%. But over the past year, it's up 8%. If you didn't know what was going on, you wouldn't know what was going on by looking at the markets. You would know something's going on in oil. But quite frankly, so far the market's response has been a bit of a yawn. March 31st was the best day since May 2025. The S&P rose nearly 3%, the NASDAQ nearly 4%. Then Trump promised to hit Iran extremely hard in his Wednesday night speech. When he said that, futures were down more than 1%, oil rose 7%. There's just no fucking way this guy or some of his acolytes aren't making a ton of money here. He knows what he's doing.
That's a whole other thing. Yeah.
The only thing that's given me any solace here, and I would recommend it to everybody else, I was up late, whatever, till two, watching this Yahoo say nothing. Except it's like, how can I say nothing yet create uncertainty in the markets? That's what he told the speed driver. I want to say nothing but yet I want to create an environment of...
Let's also eliminate half a trillion dollars in value.
I want to create an environment of uncertainty and insecurity. I don't care about my reputation. I don't care about America's reputation abroad. I don't care about US servicemen. Just create volatility because I wink-wink told people this was what was going to happen. The only thing that took my blood pressure down to like 300 last night was watching over and over the launch of Artemis 2 that launched four NASA astronauts into space and will slingshot them around the moon. And what's interesting is it's going to cost, or so far it's cost about $44 billion to develop, and the war in Iran has now passed about $38 billion. So so far, you know, pick your fighter here. Artemis 2 or this escalation in the war. And NASA estimates that a base on the moon will cost, by the way, $20 billion to develop. But what's happened here with this uncertainty? Cali has now raised the odds of a recession this year from 20% to 30% just over the past month. I'm shocked it's not higher actually, but the president is such a terrible parent. And that is, everyone's mom and dad is the president, or the nation's dad or mom. Let's say dad, there's never been a mom. And there won't be probably for another eight or 12 years. Who the fuck am I kidding? But as a parent, you need to provide some level of certainty and clarity. This is what kids need to know what they can expect from their parents. They need guardrails. They need to know that if I do this, I'm going to get in trouble. They need to know who they're coming home to from school. And the most traumatized kids later in life, it's not just the ones that are abused. It's the ones who didn't know what to expect every day from their parents. Their parents were inconsistent. I mean, and there's some research here. You'd rather have an asshole dad than a dad who is super nice and super mean all in the same fucking day. You just need to develop the coping mechanisms to deal with expectations. And right now the world, our allies, our enemies don't know what the fuck to expect from this guy. And the uncertainty is worse than, you know, people. It's easier to deal with Putin right now and Xi because other countries and other leaders have a reasonable idea of what to expect from this person.
Yeah, I think that's a really good point, especially the comparison to like Trump as the dad of America. I just think about what James Sexton told us last week where he was like, 'Hurt people hurt people.' I mean, the effects of having an erratic parent and the long-lasting traumatic effects on the child are very well documented and studied and we all know what happens there. But it's interesting like when you draw that parallel, it does make me think like what are going to be sort of the PTSD, post-traumatic effects on the American people that will last decades as a result of this ridiculously uncertain and fraught environment that he has brought upon us. I mean, I guess we're getting a little bit therapist here. Maybe that's not our lane. But it does certainly make me a little concerned.
Just real quick, I feel as if I can diagnose President Trump fairly well. He's an asshole and he's an obese man with no love in his life and will be dead soon. That's my diagnosis here.
We'll be right back after the break. And if you're enjoying the show so far, send it to a friend and please follow us on YouTube, Spotify, or wherever you get your podcasts.
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We're back with Prof G Markets. SpaceX has officially filed for an IPO and it could be the biggest one ever. The company has confidentially filed with the SEC with a potential listing coming as soon as June. It's reportedly targeting a valuation of more than $2 trillion and could raise up to $75 billion in the offering. We have known this was coming, but now it is imminent. Scott, there is a ton here to talk about. I mean, just the fact that this is going to be the largest IPO ever. Also, what it says about the space industry, which has been ripping, and of course, everyone's very excited about it right now because of the launch of Artemis 2 and other things as well. We could talk about what this will do for Elon. The fact that he will become a trillionaire if this happens, if it goes through, he'll be the world's first trillionaire. A lot of different angles here. Where do you want to start?
A decent definition of intelligence: the ability to hold two thoughts in your head at once. You know, being able to understand nuance. And there's nuance here. And that is people have a tendency to go, 'Is this an amazing company, buy the stock, or is it not an amazing company, don't buy the stock.' And what they fail to realize is that they also have to set all of this against the valuation that it's being priced at. So first off, let's talk about SpaceX. It has moats the size of the Amazon. I think it has greater barriers of entry right now than any company in the world. It's responsible for 85% of all space launches in the US last year. And its launch costs are a fifth of its closest competitor. And that's basic when you talk about launch, it's like talking about a semiconductor. It's pretty much how fast and how cheap it is. It doesn't matter how quickly you get shit into low Earth orbit. It matters how inexpensively. And they can do it for five times less. They can shoot up five of the same satellites for the same cost as their closest competitor costs to send one satellite into space. It's got incredible adjacent products. I'm going to be using Starlink on my flight home. I will now choose an airline or a means of transportation based on whether it has Starlink or not. So you're talking about airlines that are flying the same goddamn tin can at the same price to the same area. The only thing they can differentiate on is service, the configuration internally, which is getting harder and harder because you can't maintain differentiation there. But Starlink for a brief moment is a point of differentiation. It's sweeping the maritime market. It comes in with a better product at like a quarter the price. So in sum, is this an amazing company or is it ridiculously overvalued? The answer is yes. And also this man-of-the-the-people shit where he's saying he's reserving 30% of the shares for the retail investors. He's doing that because retail investors are the only ones stupid enough to pay this price. Institutions weren't going to cover the allotment here. So he gets to say, 'Oh, I'm a man of the people and I'm allocating it to retail,' as if they're getting in on something. So anyways, just a bit of a prediction here. If you get allocation in the IPO, great. And within two minutes, you want out of this thing. There might be a pop. They'll probably, the bankers and Musk, will price it such that there is a pop out of the gates. But you do not, in six months, if this thing gets out anywhere near 1.8 trillion or 1.7 trillion in valuation, you do not want to be in this stock three, six months in when people start to rationalize. Even Musk and his jazz hands can't figure out a way to justify anything resembling this valuation.
The point you make about holding two things in your head at the same time. Another aspect on this IPO is that there is both a lot of BS and a lot of jazz hands here and also a lot of actual material business substance. So I mean, let's just look at what SpaceX is. I mean, as you mentioned, they are the world leader in getting stuff out into space, responsible for more than half of all orbital launches globally last year. So they're launching more than the entire world combined. If you look at the US, they accounted for 85% of launches. So they've got that business, we've called it space hauling in the past, and in that sense they are the market leader by a huge, huge margin, and also they're doing it at the cheapest price. Also the satellite business, Starlink, they control over 10,000 satellites in orbit as of last month. That's more than two-thirds of the entire world's total. So they've got this telecommunications business as well, which is also very exciting and also ripping. And there's a lot of reason to be excited about that. And then also they've got xAI, which has merged into SpaceX as of last year. It's very unclear how that actually played out and to what extent they are actually properly merged at this point, and I guess we'll start to find that out when they start to release the filings as they file for IPO, which will be very interesting to see what is going on there. But also consider the fact that xAI is one of the leading frontier model companies in the world. I mean, they are competing, yes, they're behind, but they are competing with OpenAI and Anthropic. And so in a lot of ways there's also a big AI play here that is separate from the space business that you should also consider. And then also consider the fact that xAI is now an owner of X, formerly known as Twitter. So then at the same time it's also a social media company, and then the question becomes, are you bullish on X as a social media platform? Is that something that you're excited about? All of these businesses are getting melded into one. And I do think that that is by design because Elon, I mean, he's such a magician at commanding these extraordinary multiples because he promises all of these complex and interesting things that you can only really think about way far out into the future, which leaves investors with no choice but to basically just say, you know, screw it. The TAM's going to be massive because they're doing space and they're doing AI and also telecommunications and digital media. They're doing all of these different things. So it would be stupid to put a normal multiple on the revenues here. So whatever. Let's just say that the market cap is, call it $2 trillion. We'll make it the largest IPO in history. We'll cross our fingers and wait and see. And that is kind of the approach here. It has been his approach before, especially in the case of Tesla, where he just wraps the taxis and the humanoid robots all into one thing. And it's going to be the same thing with SpaceX.
Yeah. Like I think that he's conglomerating and I think what he's trying to do is SpaceX is the lipstick. It's an amazing company with an amazing product and xAI and Twitter are the pig. I mean, okay, xAI is growing within the Twitter community, but the reality is people are coming to grips with the fact that the winners and losers in AI in terms of LLMs, it's all about one thing. It's about the enterprise market, and that is consumers have access to a ton of free product and there's some revenue there. Nothing in the consumer market is going to justify these types of valuations when they have access to a ton of free open-weight LLMs. So this is all about the enterprise market, and let's talk about the enterprise market. You have Anthropic is now 40% of enterprise spend, and I read yesterday that they're getting 70% share on new spending in the enterprise market, and it's evidenced by the fact that OpenAI is focusing because they are clearly freaked out. OpenAI has about 27% share, Google 21%, xAI is negligible, like barely even registers. So I'm not sure I buy that xAI is a better LLM. Now, what's interesting is, can the superior connectivity of SpaceX slash whatever they're doing with Starlink give xAI an advantage? I think what he's effectively doing here is he's saying, 'Okay, I have one amazing company in space. There's nothing cooler. I can talk about it and have videos of launches. It's going to be really dramatic, really cool.' What's perfect for him is like the ultimate carnival barker, 'and then I can bury this other shit in it which will give it an AI and a media spin.' And then I think eventually he'll roll in Tesla, which is also starting to collapse, and talk about autonomous connectivity that's unrivaled, all flowing through LLMs which inform these incredible products. So it's going to be a story. There's going to be so much spin here, but it's perfect for him because he was able to artificially elevate Tesla for a decade. There's just no fucking way to rationalize Tesla's valuation other than him saying, 'Oh, Robotaxi or autonomous driving. It's coming, a thousand, a million autonomous taxis on the road within 12 months.' I think he said that in 2017. So what is he?
He's bored of that now. Now it's humanoid robots. I mean, now that the taxis...
Look over here, a humanoid. We haven't heard much about those humanoid robots lately.
So this is the ultimate. He's got an amazing company that'll be sort of the lead, the lipstick on these different pigs. This is going to be an incredible act of showmanship. An amazing company. Maybe worth 300 billion. I don't know. Maybe worth 400 billion.
I think that segues us well into this retail investor element. I mean, the stat that is important for people to know is that SpaceX is allocating more than 30% of the IPO shares to retail investors. Most IPOs will save 10% for retail. So there is clearly — I mean, you could read this as, oh, this is nice of them because they're opening up to retail investors and they're giving retail investors a shot. Or you read it as they need the retail investor to prop up this very, very ridiculous valuation because perhaps it will be the retail investors. Maybe they view it quite cynically. Maybe they see that the retail investors might be the dumb money and they say retail investors will be the ones who are most susceptible to our kind of ridiculous narrative laundering story here about a future of AI combined with space. By the way, we should mention that he's also talking about building data centers in space. That's like one of his big themes for SpaceX, which many people, many experts have said is completely ridiculous and doesn't make any sense whatsoever. The idea that we're going to — I mean, we have land on Earth. Why are you going to go build a data center on a space station in space? It just doesn't really make sense. But it might be the kind of story that retail is particularly susceptible to. I mean, some people would say that we're being patronizing to retail investors, perhaps. But I mean, let's also consider the fact that 43% of Tesla is owned by retail investors. Like, retail is the thing that is supporting that extraordinary valuation. And it does appear that they believe that that is what is going to support this valuation too. I'm maybe just cynical, but I view it as them sort of taking advantage of retail as opposed to offering them an opportunity.
Probably the most — you would argue the most innovative company of the last five or 10 years has been Nvidia. And Nvidia is trading at a forward PE of somewhere between 17 and 20. That's a price to earnings.
I mean, you made the Google comparison earlier, which I think is a good one, because when Google IPO'd, the company was trading at 10 times trailing revenue, the revenue growth was 240%. You look at SpaceX, which is going public at more than 125 times trailing revenue. The growth is 20%. So when you think about it, SpaceX's revenue growth is 10 times lower than Google's was when Google IPO'd. And yet the valuation is more than 10 times higher than Google's was when Google went public. So the whole thing is kind of flipped on its head here. And the only thing that could justify the valuation is if you believe that there's this very, very special future of space and AI and data centers that all comes together in the perfect way. And it's all — I mean, you really, it's just hopium. You have to hope that this is going to be a massively successful business. Maybe it will be, but that's a lot of hope in there. You're putting a lot of faith in his ability to grow these revenues tremendously. $16 billion in revenue last year. That's not that big. That's not that impressive. $8 billion in profit. Okay, whatever. The valuation's just — it's just too high.
When I hear that type of striking insight from you, the only thought that kind of runs through my mind is that it's hard to believe that I was nominated for three Webbies and you were nominated for zero. Hello, ladies. Watch your shoulders. Watch his shoulders. Hello. I'm sorry. Yeah, that's fascinating. Yeah, you're going to trigger me again and then I'm going to start getting salty and upset.
You still have time, my brother. When I was 27, I knew every line from the Planet of the Apes and could make a bong out of any household item. That was really my accomplishments to that point. You're doing just fine, Ed.
Ah, but you know, I'm getting to that age where you started actually to do some cool stuff. I mean, I'm 27 now. I'm pretty sure that's when you were starting your first company. Like, we're rubbing up against your glow-up period here. So I take your point.
Company's doing a lot of work there. It was me working out of a $280 apartment in Rockridge, Oakland, calling the alumni of HBS saying, 'I'm a brand strategist. Will you hire me?'
