When you’re about to become a multi-millionaire, it helps to have a thousand friends in the same boat. More than 1,000 current and former SpaceX employees have organized a collective effort to negotiate reduced advisory fees from wealth management firms and private banks, targeting rates below 0.5% of assets under management.
The standard industry rate sits around 1% AUM. That might sound like a rounding error, but on the kind of equity windfalls expected from SpaceX’s IPO, the difference between 0.5% and 1% could mean millions of dollars per person over time.
The numbers behind the negotiation
SpaceX has adjusted its IPO valuation target to a minimum of $1.8 trillion, down from prior discussions that floated figures north of $2 trillion. The company is planning to raise up to $75 billion through the public offering.
Wall Street banks working the deal are expected to earn around $500 million in underwriting fees. SpaceX executives are reportedly negotiating those fees down as well, a parallel effort to the employee-driven push on the wealth management side.
