Insiders betting on Musk are now reaping "historic-level returns"

Author: Li Hailun, Tencent Technology

The largest initial public offering (IPO) in history is entering its final countdown. Elon Musk’s SpaceX is expected to set its IPO price on June 12, with trading beginning the following day.

Investors are targeting an estimated valuation of around $2 trillion. Based on this, Musk himself would directly become the world’s first trillionaire. But the real drama of this deal is that wealth will not flow solely to Musk. As the prospectus is disclosed, a group of long-hidden loyal deputies and early allies behind Musk will see their holdings’ value surface for the first time.

Their “loyalty” and patience are paying off with the most substantial returns in history.

Musk’s “Shadow Partners”

Among all those who have gained enormous wealth from SpaceX’s IPO, Antonio Gracias’s identity is the most unique.

He is not an employee of the company, yet he is more deeply embedded in Musk’s business empire than most executives.

55-year-old Gracias is the founder of Chicago-based investment firm Valor Equity Partners. The two met through the Silicon Valley network formed after Musk’s early PayPal transactions in the early 2000s. At that time, Musk had just sold the company to eBay, while Gracias was running his own investment firm, Valor Equity Partners.

During Tesla’s near-bankruptcy from 2008 to early 2009, Gracias personally lent Musk $1 million. Since then, he has become one of Musk’s closest private friends. He was also a groomsman at Kimbal Musk’s wedding, and the two families have even vacationed together.

This two-decade-long friendship is now transforming into staggering wealth. Gracias, through investment entities affiliated with Valor, holds over 500 million shares of SpaceX Class A stock, about 7.3% of the company’s Class A shares, making him the second-largest individual shareholder after Musk.

Based on a conservative valuation of $1.5 trillion, these shares are worth about $91.6 billion. If valued at $2 trillion, they exceed $140 billion. Regardless of the final pricing range, he will rank among the top 50 wealthiest people globally.

Gracias appears on nearly all of Musk’s company boards. He served as Tesla’s independent chairman for eight years and has been a director at SolarCity, Neuralink, and The Boring Company. He even agreed in early 2025 to provide financing for Musk’s failed hostile takeover of OpenAI, valued at $97 billion.

Gracias’s financial relationship with SpaceX is not limited to equity. The prospectus discloses an unusual arrangement. In October 2025, a subsidiary of xAI called CTC signed a lease agreement for AI infrastructure hardware with Valor. In January and April 2026, they signed a second and third lease respectively. The three agreements require CTC to pay nearly $20k to Valor over their terms, with SpaceX itself providing full guarantees for these payments.

This means that if CTC’s subsidiary cannot pay, SpaceX bears legal responsibility to cover the costs. Such guarantees send a signal: xAI may not be able to secure this level of financing on its own credit and needs parent company intervention. In fact, documents show xAI is heavily leveraged, including secured senior notes with interest rates as high as 12.5%. This is typical of borrowers in financial distress, indicating the company’s difficulty in obtaining conventional financing.

The structure of these transactions has raised alarms among auditors. PwC, SpaceX’s auditor, refused to classify these agreements as ordinary leases, instead characterizing them as “failed sale-leasebacks.”

In a typical sale-leaseback, one party sells an asset to another and then leases it back for use, with the buyer gaining actual control of the asset. But PwC believes the contract terms allow CTC to retain actual control of the GPU, making Valor’s role closer to that of a lender with the GPU as collateral. The auditors mandated SpaceX to record this $9 billion debt on its balance sheet as a related-party liability payable to the entity in which the board members serve.

SpaceX President and COO

Among all the soon-to-be new billionaires, Gwynne Shotwell’s story is most representative. The 62-year-old joined the company in 2002, ranked 11th in seniority.

Initially, her task was to bring sales orders for the then-unknown Falcon 1 rocket. Over more than two decades, she has become the company’s president and COO, frequently appearing at industry events and serving as SpaceX’s de facto public face while Musk focused on other ventures.

According to the prospectus, Shotwell directly or through trusts holds 12.4 million SpaceX shares and 4.7 million stock options. If the company is valued at $2 trillion, her holdings alone would be worth about $20 billion. Her total compensation in 2025 was $85.8 million, mainly from substantial restricted stock awards.

Born in Illinois, Shotwell studied mechanical engineering and applied mathematics at Northwestern University. She started her career in aerospace, working on thermal analysis and small spacecraft design.

She met Musk in 2002 and quickly joined SpaceX, becoming president in 2008. For an engineer who has bet her entire career on a company once mocked as a “crazy dream,” this wealth represents a long-overdue recognition.

SpaceX CFO

Compared to the frequently visible Shotwell, Johnsen appears more as SpaceX’s internal financial steward, responsible for supporting the high-cost company’s capital lifeline.

He joined SpaceX in 2011, after nearly a decade in finance at Broadcom and semiconductor firm Mindspeed. During the long years of secretive operations and financial performance, Johnsen was the main contact for answering tough questions and coordinating stock transactions.

In December 2025, Johnsen sent a memo to employees outlining the reasons for going public. He wrote: “Our idea is that if we execute very well and the market cooperates, an IPO can raise substantial funds.”

Johnsen holds about 9.6 million SpaceX shares. At a $2 trillion valuation, this is worth roughly $1.4 billion. His total compensation in 2025 was $9.8 million.

“PayPal Mafia”

Luke Nosek’s connection to Musk dates back to PayPal days. He is a co-founder of PayPal and served as Vice President of Marketing and Strategy, and is a core member of the so-called “PayPal Mafia.”

In 2002, eBay announced and completed its acquisition of PayPal. Nosek, along with Peter Thiel and others, co-founded Founders Fund, and in 2008 led its first investment in SpaceX. He then gained a seat on the board and has served there ever since.

Later, Nosek left Founders Fund to establish his own venture capital firm, Gigafund, investing over $1 billion in SpaceX, as well as supporting Neuralink and The Boring Company.

Nosek directly owns nearly 25 million shares of SpaceX Class A stock, and through Nosek Capital holds another approximately 8 million shares. At a $2 trillion valuation, his total holdings are worth about $5.3 billion. Like Musk, Nosek has pledged nearly 2.4 million SpaceX shares as collateral for loans.

Institutional Players and University Funds

Beyond individual wealth stories, SpaceX’s shareholder roster also features some institutional players.

Donald Harrison, a Google executive, represents this early institutional investor on SpaceX’s board. Founders Fund co-founder Steve Jurvetson has been a long-time ally of Musk, serving as a director since 2009.

Venture capitalist Ira Ehrenpreis joined the board in February 2026, expected to chair the Compensation and Nominations Committee. Randi Glein, co-founder of DFJ Growth, became a director in 2026 after long service as an observer, and will chair the Audit Committee. Ehrenpreis holds about 1.37 million shares of SpaceX, valued conservatively at around $250 million; Glein owns about 278k shares, worth roughly $50 million.

A more dramatic story involves higher education institutions. About ten years ago, Scott Wilson, chief investment officer at the University of Washington, invested roughly $50 million of the school’s funds into SpaceX. This bet has now soared to over 10% of the university’s $17 billion endowment, mainly through co-investments and late-stage rounds via external private equity and venture capital managers.

Anders Hall, investment director at Vanderbilt University, estimates the school’s position in SpaceX at about $15k, some of which was invested through relationships with general partners over a decade ago. As of June 2025, the university’s endowment totaled $10.9 billion.

However, the massive IPO payout is a double-edged sword for endowments. They will receive large cash inflows, but the wealthiest private schools will face higher net investment income taxes. The U.S. Congress has increased the rate from 1.4% to 4% or 8%, depending on the school’s size.

AI Creates Sky-High Bills

What the SpaceX IPO reveals is not only a chance for a few to get fabulously rich but also the company’s awkward financial reality.

This rocket and AI company has yet to turn a profit, and its spending far outpaces its earnings. In 2025, the company lost $4.9 billion. In just the first three months of 2026, it lost $4.3 billion on revenue of $4.7 billion.

Annual revenue is growing at about 33%, but capital expenditures are doubling each year. In 2025, SpaceX spent $20.7 billion, with about 60% invested in AI. In the first three months of 2026, the company spent $10.1 billion, with $7.7 billion flowing into AI.

Once listed, all these debts and spending pressures will shift to public shareholders. They will also inherit billions of dollars of debt obligations from a series of private deals, including lease agreements with Valor.

A particularly startling clause in the prospectus states: Once 1 million people live on Mars, Musk will receive up to 20k additional shares, which are now already part of his vast voting power pool capable of controlling the company.

For a consistently unprofitable company, investors will have to judge between aggressive spending, massive losses, and a governance structure entirely controlled by insiders.