CNBC Television: Ron Baron on upcoming SpaceX IPO: This is going to become the largest company on the planet

Sourced by youtube-ingest on 2026-05-12. From creator-uploaded YouTube captions (en, broadcast CC1). Duration: 8:11. Video: https://www.youtube.com/watch?v=FcZiyBgHiJo.

Show notes (from YouTube)

Ron Baron, Baron Capital founder, CEO and portfolio manager, joins 'Squawk Box' to discuss the upcoming SpaceX IPO, the future of Tesla, his thoughts on Elon Musk, and more.

Transcript

COURSE OF THE PAST YEAR. SO BECKY AST SPACE MOBILE A STOCK ON THE MOVE. I'LL SEND THINGS BACK OVER TO YOU GUYS.

OKAY, DOM, THANK YOU VERY MUCH. WE HAVE A LOT OF GROUND TO COVER WITH OUR NEXT GUEST, BEGINNING WITH ELON MUSK'S SPACEX, WHICH IS PLANNING THE LARGEST STOCK DEBUT IN HISTORY. SO LET'S GET RIGHT TO RON BARRETT. HE IS AN EARLY INVESTOR IN SPACE X. HE IS THE FOUNDER, THE CEO AND THE PORTFOLIO MANAGER OF BARON CAPITAL, WHICH STARTED OUT IN 1982 WITH $10 MILLION IN ASSETS UNDER MANAGEMENT. BY 1992, IT HAD GROWN TO $100 MILLION, AND TODAY IT IS AROUND $50.9 BILLION IN ASSETS UNDER MANAGEMENT. RON, WANT TO THANK YOU FOR BEING WITH US THIS MORNING.

TO BE EXACT.

55,898,000,000 55 BILLION 55,000,000,890. ON WITH US. IN NOVEMBER OF LAST YEAR, IT WAS 45 BILLION. WHAT GREW.

O SPACE X GREW. AND I GUESS I DON'T KNOW, BUT THAT'S THE BIG ONE. SO THAT HAPPENS TO BE 15 BILLION OUT OF OUR 55 OR $56 BILLION IS SPACE X, AND TESLA'S OUR SECOND BIGGEST AT 5 BILLION. SO WE MADE OUR CLIENTS $61 BILLION IN PROFITS AND OURSELVES SINCE 1992, WHEN WE HAD $100 MILLION, 61 BILLION CAME FROM 100 MILLION. AND NOW I THINK THAT IN THE CASE OF TESLA, WHICH WE'VE BEEN INVESTING IN, MET HIM IN 2010 IN AN IPO, TOOK ME FOUR YEARS TO BE COME CONVINCED THAT HE WAS GOING TO BE SUCCESSFUL. I THOUGHT HE WAS BRILLIANT, KEPT TALKING TO HIM, KEPT VISITING HIM. 2014, GO TO VISIT HIM AGAIN AND SAID, MAN, I HAVE TO INVEST IN THIS NOW. NOW IS THE TIME. STOCK TRIPLES FROM 25 TO 75. I DON'T OWN A SHARE. IT DOUBLES AGAIN. THE PAIN IS TOO GREAT. AND AND THEN WE INVEST $400 MILLION BETWEEN 2014 AND 16 AND MAKE ABOUT $8 BILLION SO FAR IN PROFIT. AND I THINK WE'RE GOING TO MAKE FIVE TIMES THAT AMOUNT IN TEN YEARS. AND THEN SPACE X STARTING IN 2017, BECAUSE I HAVE THIS RELATIONSHIP WITH HIM. IT'S VERY GOOD. AND I LEARN ABOUT SPACE X AND I'M INTERESTED IN IT. AND I SAY, I LIKE TO INVEST IN THAT. AND THEY DO THESE TENDERS TWICE A YEAR IN SPACE X, BECAUSE EVERY SINGLE EMPLOYEE IS A SHAREHOLDER IN SPACE X, I C BECKY, YOU ARE THIS FANTASTIC ENGINEER. YOU'RE MAKING $250,000 A YEAR. BUT WHAT YOU'RE NOW WORTH $5 MILLION, DON'T YOU THINK IT WOULD BE A SMART THING TO SELL SOME OF THAT STOCK A LITTLE BIT, TO PUT THE MONEY IN THE BANK AND PROTECT YOUR FAMILY? SO THEY HAVE THESE TENDERS TWICE A YEAR FOR $1 BILLION APIECE. AND WE'VE BEEN ONE OF THE LARGEST, IF NOT THE LARGEST PURCHASER IN EACH OF THESE DEALS. AND RECENTLY AND THEY GET OVERSUBSCRIBED WITHOUT ANY ANNOUNCEMENTS. AND NO BANKERS HAVE BEEN OVERSUBSCRIBED IN ONE AFTERNOON. AND SO WE'RE TREATED JUST LIKE ONE OF THE LARGEST INSTITUTIONS IN EACH ONE OF THESE OFFERINGS.

BASICALLY, YOU ARE PAYING THE EMPLOYEES SO THAT THEY CAN BECOME MORE LIQUID AND HOLD ON TO THOSE THINGS. AND THAT'S HOW YOU'VE GOTTEN YOUR OWNERSHIP. STAKE IN THIS PRIVATE COMPANY.

SO WE'VE INVESTED.

IN WHICH, BY THE WAY, THAT'S PART OF THE REASON THAT THIS COMPANY HAS BEEN ABLE TO REMAIN PRIVATE FOR SO LONG.

YEAH. RIGHT. AND, AND SO WE'VE INVESTED ABOUT 1,000,000,007 SINCE 2017, AND THAT'S NOW WORTH ABOUT $15 BILLION AT CURRENT MARKET PRICES. SO OF THE 61 BILLION OF PROFITS, 20 BILLION COME FROM HIM.

YOU HAVE BEEN SOMEBODY WHO HAS BEEN AN APOSTLE KIND OF SPEAKING ABOUT THIS FOR YEARS. I CAN REMEMBER HAVING A CONVERSATION WITH YOU PROBABLY BACK IN 2020, 2021. YOU TRIED TO CONVINCE ME TO DO IT. WE'RE NOT ALLOWED TO INVEST. AND I HAD TO TELL YOU THAT. BUT YOU WERE SAYING SPACE IS WHERE IT'S GOING TO BE. THIS IS THE INVESTMENT YOU REALLY SHOULD GET INTO. I HAD TO SAY NO THE WHOLE WAY THROUGH. YOU'RE NOW LOOKING AT THIS COMPANY ABOUT TO GO PUBLIC. AND WHAT DO YOU THINK THE OPPORTUNITY IS HERE? WHAT DO YOU THINK HAPPENS?

THIS IS GOING TO BECOME THE LARGEST COMPANY ON THE PLANET. THIS IS THIS IS. SO WHEN YOU GO PUBLIC, I DON'T KNOW IF IT'S GOING PUBLIC AT 1.5 TRILLION OR 1.75 TRILLION OR MAYBE A LITTLE BIT MORE. BUT WHERE IT GOES PUBLIC, I THINK THAT THE COMPANY OVER THE NEXT 10 OR 15 YEARS IS GOING TO BE WORTH 10 TRILLION, 20 TRILLION, 30 TRILLION. AND I COULD BE VERY LOW. IT COULD BE VERY LOW ON WHERE IT'S GOING TO BE. SO SO TODAY WE CAN TALK A LITTLE BIT ABOUT INFRASTRUCTURE.

WHY? YEAH, LET'S TALK ABOUT WHY.

BECAUSE THERE'S.

SEVERAL LIKE 70 BILLION OF THAT WOULD BE WHAT WHAT THE PUBLIC CAN ACTUALLY BUY INTO, I THINK.

70 BILLION. EXACTLY. RIGHT. IN FACT, RIGHT AFTER THE OFFERING, THEN THEY'VE CHANGED THE RULES SO THAT FIVE DAYS AFTER THE IPO IS COMPLETED, THERE WILL BE A ONE INDEX IN WHICH IT WILL BE INCLUDED TEN DAYS. THERE WILL BE ANOTHER INDEX IN WHICH IT'S INCLUDED 15 DAYS. THERE WILL BE ANOTHER INDEX IN WHICH IT'S INCLUDED.

YOU'RE TALKING ABOUT THE NASDAQ INDEX.

THE PRESIDENT NEW YORK STOCK EXCHANGE YOU KNOW, WHEN I WAS YOUNG, I DROVE AN ICE CREAM TRUCK ONE SUMMER AND MAYBE SUMMER AND A HALF. AND ONE OF THE THINGS THAT WAS IMPORTANT TO ME WAS I HAD TO. YET MY CARNIVAL BORE ICE CREAM TRUCK TO THE BEACH ROUTE BEFORE MISTER SOFTEE GOT THERE. AND SO YOU HAVE SO, SO ONE OF THE GUYS IN MY OFFICE SAID, AND THE NEW YORK STOCK EXCHANGE PRESIDENT WANTED TO COME OVER AND TALK TO ME FOR SOME ADVICE. AND MY FRIEND SAYS, PAT PETER LYNCH IS OUR CHIEF OPERATING OFFICER. I SAID, DO YOU EVER THINK WHEN YOU'RE DRIVING AN ICE CREAM TRUCK, THAT THE PRESIDENT OF NEW YORK STOCK EXCHANGE IS GOING TO COME TALK TO YOU FOR ADVICE? ARE YOU SERIOUS? AND AND THEY SAID, WELL, I WAS ABLE TO MEET MR. SOFTEE TO WHERE HE WAS GOING. AND, AND SO SO.

HE CAME TO ASK YOU FOR ADVICE ABOUT WHETHER THEY SHOULD PUT THAT INTO THE INDEX EARLY.

WELL, SHE WAS TELLING ME ABOUT THE DIFFERENT INDEXES, BUT SHE WAS ALSO HOPING THAT THEY WOULD LIST ON THE NEW YORK STOCK EXCHANGE. AND THEY CHOSE.

THEY CHOSE THE NASDAQ.

I THINK THEY'VE CHOSEN NASDAQ, WHICH IS WHERE ALL THE TECHNOLOGY COMPANIES ARE. AND SHE WAS SAYING THAT, YOU KNOW, THERE ARE ALL THESE OTHER THINGS THAT SHE COULD OFFER.

BUT THAT WAS PART OF THE AUCTION PROCESS WHERE THE TWO EXCHANGES WERE BIDDING IT UP, SAYING, HEY, WE CAN OFFER TO GET YOU INTO THE INDEX SOONER.

I DON'T KNOW, I THINK THEY'VE PRETTY MUCH DECIDED THAT AS A LEADING TECHNOLOGY COMPANY, THEY SHOULD BE LISTED ON NASDAQ, WHERE ALL THE OTHER LARGE TECHNOLOGY COMPANIES HAVE ENLISTED. BUT BUT THERE ARE A LOT. THERE'S A LOT. SO WHAT ENABLED THIS COMPANY IS HIM. SO HE COMES UP WITH THE IDEA THAT YOU'LL BE ABLE TO LAUNCH A ROCKET AND REUSE IT. AND, AND NO ONE EVER DID THAT BEFORE. AND NO OTHER ROCKET COMPANY WAS INTERESTED IN DOING THAT. BECAUSE IF THEY DID, THEN WHAT WOULD HAPPEN IS THAT THERE WOULD NOT BE A DEMAND FOR AS MANY ROCKETS. SO NOBODY WANTED TO DO THIS. AND AND THEY ALWAYS SAID IT WAS IMPOSSIBLE. THEY SAID IT WAS IMPOSSIBLE BECAUSE NOBODY TRIED. AND WHEN THEY DID TRY, IT TAKES NOBODY'S BEEN ABLE TO ACCOMPLISH IT. SO THAT'S WHAT ENABLED THIS. THAT'S WHAT ENABLED US TO HAVE STARLINK AND STARLINK. AFTER YOU HAVE THAT, AND WE HAVE THE FALCON NINE, THEN IT BRINGS IT UP AND COMES BACK. THEN WE DECIDED, HEY, WAIT, THERE'S A DEMAND FOR IN SPACEX DATA CENTERS. AND HAVING INSTEAD OF HAVING DATA CENTERS ON OUR PLANET WHERE IT'S VERY, VERY DIFFICULT TO GET THE GOVERNOR ONE IN NEW JERSEY, BECAUSE SHE SAID, OUR ELECTRICITY BILLS ARE TOO HIGH, WE'RE GOING TO STOP THIS DATA CENTER CONSTRUCTION, MAKING OUR ELECTRICITY BILLS GO UP. HER ROOMMATE, WHEN SHE WAS IN CONGRESS IS THE IS A CANDIDATE FOR GOVERNOR IN VIRGINIA. SHE WON SAME SAME IDEA. SO SO HERE YOU HAVE PEOPLE WHO ARE SAYING.

NOT IN MY BACKYARD.

THAT'S THE DEAL.

NOBODY WANTS IT IN THEIR BACKYARD.

SO I WOULD HAVE THOUGHT THEY WOULD LIKE IT BECAUSE IT WOULD PAY TAXES. BUT PEOPLE DON'T LIKE IT BECAUSE NOT ENOUGH JOBS AND BECAUSE THE ELECTRICITY BILLS ARE GOING UP.

SO THEY PUT IN USAGE.

TO WATER IS SHORT AND ELECTRICITY IS A PROBLEM.

AND THE WATER YOU NEED FOR COOLING, WHICH YOU DON'T NEED IN SPACE, RIGHT?

YOU DON'T NEED THE COOLING IN SPACE. NUMBER ONE, AS LONG AS YOU HAVE GIANT RADIATORS AND THEN ELECTRICITY, WHICH IS A HUGE COST, YOU DON'T NEED THAT EITHER BECAUSE YOU'RE USING THE SUN. SO BASICALLY YOU'RE GETTING FREE, FREE ELECTRICITY AND FREE COOLING ONCE YOU GET INTO SPACE. AND SO NOW, BECAUSE OF THE IDEA OF GOING TO SPACE, WE'VE NOW DEVELOPED THE STARSHIP. AND THE STARSHIP. ONCE THAT WORKS IS GOING TO BE 100 TIMES