News
Tesla, SpaceX, Elon Musk ventures cleared by SEC for private fundraising after tweet controversy
Tesla, SpaceX, The Boring Company (TBC), and Neuralink have all been granted waivers allowing them to continue raising capital by privately selling restricted securities (typically private equity or debt), heading off potential barriers that would increase the difficulty of raising capital through the sale of securities.
Cued by the commission’s settled suit over CEO Elon Musk’s improper and misleading dissemination of information material to Tesla shareholders, the United States Securities and Exchange Commission (SEC) has granted investment disqualification waivers – specifically “waivers of disqualification under Rule 506 of Regulation D” – to each of the four major companies owned by Elon Musk.
-
- Building giant factories like Gigafactory 2 demands major capital investments that often require private equity sales. (Tesla)
-
- Rockets are perhaps even more capital intensive. (SpaceX)
Losing the ability to raise funds in this manner would make it much harder for companies like Tesla and SpaceX to raise the money frequently needed for expansions and major R&D projects, described in the waiver requests as “extremely capital intensive.” However, the bulk of the arguments provided by each company’s legal representatives can be largely ignored. Arguing to the contrary – i.e. failing to make a strong case that the given company may need private equity investment – could close critical doors that each company may not need right this moment but would like to preserve as an option.
Still, each waiver request offers a slight glimpse into the inner-workings of SpaceX, TBC, and Neuralink, typically hidden from the public eye as privately held entities.
Tesla
Tesla, being a publicly-traded company, offered few secrets in its waiver request. However, it did publicize the best overview yet of what exactly the SEC’s demand for the regulation of Elon Musk’s Tesla-material communications might translate to inside the company. According to Tesla’s legal representatives, the company is arranging the creation of “new, permanent committee…of independent directors only [that] will provide an additional check on the procedures and processes for overseeing Mr. Musk’s Tesla-related public statements.” Tesla will also reportedly task “another experienced securities lawyer…to undertake an enhanced review of communications made through Twitter and other social media by the [sic] Tesla’s senior officers.”
The hope is that this new arrangement will prevent a recurrence of the misconduct that led to the SEC’s suit and the subsequent settlement. More likely, however, is that the threat of the modification or withdrawal of these four waivers will prevent Musk from stepping outside the bounds of the SEC’s binding settlement agreement, as doing so could truly harm the potential of all four companies.
SpaceX
In SpaceX’s waiver request, the company’s legal representatives confirmed that it has raised “more than $2 billion in [eleven separate] securities offerings” that fell under the purview of activities SpaceX would be disqualified from pursuing without a waiver from the SEC. The total value of investments on the public record currently hovers around $2.27 billion, including a partially-finished Series I round that has likely raised that to value to ~$2.5 billion since it surfaced in April 2018.
“The design and manufacture of launch vehicles and spacecraft is extremely capital intensive. SpaceX needs sufficient [and may need to raise additional] capital to fund its ongoing operations and future expansions, for example: development of its BFR launch vehicle and Crew Dragon spacecraft, continuing research and development projects, and making investments in tooling and manufacturing”
The Boring Company & Neuralink
As for TBC and Neuralink, the waivers didn’t offer anything unexpected, although they did provide great, brief overviews of what exactly the two companies are currently working towards. Although it was announced in late 2017 that Musk would sell stock to fund initial operations at TBC and Neuralink, both companies’ legal representatives confirmed the exact amount of funding raised by “Musk and various other third-party investors”: $112.5 million and $100.2 million, respectively.
Both expressly confirmed no intentions to pursue initial public offerings (IPOs) anytime soon, although Neuralink’s waiver indicated that it may invest in or acquire other companies pursuing brain-computer interfaces.
-
-
- Musk believes that TBC will finish its first test-tunnel in roughly six weeks, in early December. (TBC)
-
- The Boring Company’s next-gen tunnel-boring machine seen in its early stages, October 5th. [Credit: Tom Cross/Teslarati]
-
- While we have no clue what Neuralink’s stealthed work has produced, it’s perhaps the most long-term venture Musk has started. The path to market for medical devices is very long and even more expensive.
The Boring Company
“The Boring Company (TBC) is a fast-growing infrastructure and transportation company focused on developing cost effective, and fast tunneling technology, along with electric mass transportation systems to alleviate the massive problem of traffic and congestion within cities. The research, development, design, manufacture, testing, and construction of tunnels and mass transit systems is a capital intensive business. TBC needs sufficient capital to fund its ongoing operations and future expansions, for example: continued development and improvement of Tunnel Boring Machines (“TBMs”) and electric skates, the construction of mass transit tunnels including publicly announced projects in Chicago, Los Angeles, and Washington D.C..”
Neuralink
“Neuralink is a fast-growing bio-technology and medical device company focused on developing high bandwidth, long term, brain computer interfaces (“BCI”). The research, development, design, manufacture, testing, and certification of medical devices and BCI’s is purely capital intensive business requiting deep investment for years prior to any initial revenue. Neuralink needs sufficient capital to fund its ongoing operations and eventually bringing products to marked, for example: continued development of BCI’s, continued testing of implantable devices, financing of multi-year FDA trials and certifications, and the construction of FDA-approved manufacturing facilities. Neuralink will need to raise capital for these operations and expansions, and given the development stage of the company, it is most likely that such financing will be through private securities offerings in reliance on Rule 506 of Regulation D.”
-
Elon Musk has declared that SpaceX has effectively solved one of Starship’s most persistent engineering challenges: the reliability of its heat shield tiles.
During the company’s first-ever Earnings Call, the SpaceX CEO stated:
“I don’t want to jinx it or anything, but I think I would call the heat shield problem solved at this point. All indications from data and visual inspection is we have solved it. That doesn’t mean we won’t make improvements, but we do not see any technical obstacles to achieving rapid reusability at this point.”
Starship’s heat shield consists of roughly 18,000 hexagonal ceramic tiles covering the windward side of the upper stage. These tiles form the thermal protection system that shields the vehicle’s stainless-steel structure from the extreme heat of atmospheric reentry.
Elon says he believes the heat shield problem with Starship is currently solved.
He called it “arguably the single biggest problem” pic.twitter.com/eEE9vM5zlz
— TESLARATI (@Teslarati) August 4, 2026
-
During descent, atmospheric friction generates temperatures exceeding several thousand degrees Celsius and creates plasma flows capable of melting unprotected metal. The tiles absorb, radiate, and insulate against this energy, allowing the vehicle to survive and potentially fly again. Without a durable heat shield, full and rapid reusability, the cornerstone of Starship’s design for frequent launches, satellite deployments, and deep-space missions, would remain impossible.
The tiles have long been a source of difficulty. On earlier test flights, a significant number of tiles detached during ascent due to vibration, aerodynamic loads, and imperfect attachment methods using pins and adhesives. Gaps between tiles allowed hot plasma to infiltrate, causing secondary damage and hot spots on the underlying structure.
These issues echoed challenges faced by NASA’s Space Shuttle, whose ceramic tiles required extensive, labor-intensive inspections and replacements between missions, preventing rapid turnaround. SpaceX has iteratively improved materials, standardized tile shapes, refined attachment techniques, added secondary ablative layers, and tested sealing methods such as “crunch wrap” felt to close gaps.
Progress was visible across Flights 10–12, with steadily better tile retention, yet questions remained about whether the system could support the minimal-refurbishment goal of rapid reuse.
Flight 13 on July 24 provided the decisive evidence. Ship 40 flew a deliberately more demanding profile with higher dynamic pressure to stress the heat shield beyond typical operational loads. It successfully deployed 20 operational Starlink V3 satellites, the first such payload on a Starship mission, performed an in-space Raptor engine relight, and executed a controlled reentry.
Elon Musk sheds two new bits of detail on Starship after 13th test launch
Cameras on six of the satellites and onboard sensors captured extensive imagery and data of the shield throughout the flight. The ship then achieved its softest splashdown to date in the Indian Ocean, remaining intact and floating rather than breaking apart or exploding as on prior missions. This allowed drone inspections and continuous telemetry of the heat shield in near-real time.
-
Post-flight analysis showed the majority of tiles remaining attached with only minor damage and limited plasma streaking at seams. Musk noted that the mission delivered “all the heat shield data we needed and then some.” Combined with visual inspections, these results underpinned his subsequent assessment that the core technical barriers to rapid reusability have been cleared. While refinements will continue, Flight 13 marked a pivotal step toward Starship’s operational future.
SpaceX COO Gwynne Shotwell outlined ambitious plans for Starlink Mobile during the company’s August 4 Earnings call, signaling a direct challenge to U.S. wireless giants like AT&T, T-Mobile, and Verizon.
Shotwell noted that the three companies generate roughly $600 billion in combined annual revenue. “I anticipate us to be able to acquire quite a few of their customers because I think our service will be better,” she said. “We will eliminate dead zones leveraging the satellites in orbit. It will be better during any natural disaster… I’m quite excited about Starlink Mobile.”
SpaceX President & COO Gwynne Shotwell on @Starlink Mobile and its impact on Verizon, AT&T and T-Mobile:
“Roughly, between them, $600 billion a year. I anticipate us to be able to acquire quite a few of their customers. Our service will be better. We will eliminate dead zones… pic.twitter.com/UYZUkrGc0L
— Sawyer Merritt (@SawyerMerritt) August 4, 2026
SpaceX intends to combine its satellite constellation with terrestrial infrastructure. The company has acquired about 65 MHz of spectrum from EchoStar and plans to deploy next-generation Starlink Mobile satellites in 2027, with upgraded service targeted for the end of that year.
Shotwell described the enhanced network, leveraging more satellites and spectrum, as potentially “100 times better” than the current direct-to-cell offering, which already supports basic texting and app-based voice/video in coverage gaps through partnerships. She also indicated plans for low-cost cellular base stations that could integrate with existing Starlink dishes, creating a hybrid system for broader capacity in urban, suburban, and rural areas.
-
For the general public, Starlink Mobile promises significant advantages. Satellite connectivity can fill gaps where traditional cell towers fail, delivering service in remote locations, mountains, or during outages caused by storms, wildfires, or infrastructure damage—conditions in which ground networks often collapse.
Users could enjoy more consistent coverage without relying solely on dense tower builds, potentially at competitive prices as SpaceX scales. The hybrid approach aims to support full mobile services, including higher-speed data, while working with unmodified smartphones over time.
These developments revive long-standing but unfounded rumors of a Musk-developed “Tesla phone.” Speculative claims of a “Pi Phone” or similar device with built-in Starlink connectivity have circulated for years on social media, often featuring fabricated images and details. Elon Musk has repeatedly denied any such plans, stating Tesla has no intention of entering the smartphone market unless forced by extreme circumstances with app stores.
No official product, filings, or development announcements have ever materialized; the rumors remain hoaxes.
The announcement quickly pressured telecom stocks. Shares of AT&T, Verizon, and T-Mobile fell between roughly 2 and 4 percent in after-hours and premarket trading as investors weighed the competitive threat from a hybrid satellite-terrestrial network.
While execution challenges remain—spectrum deployment, infrastructure rollout, and regulatory hurdles—Shotwell’s remarks mark SpaceX’s clearest signal yet of entering the consumer mobile market as a full competitor.
-
Venture capitalist Chamath Palihapitiya has cautioned investors shorting SpaceX shares, drawing a direct parallel to the intense short-selling pressure Tesla faced in its early public years.
Responding to reports of elevated short interest in the newly public rocket, satellite, and AI company, Palihapitiya noted that similar dynamics played out with Tesla, where aggressive short sellers ultimately “went broke.”
SpaceX (NASDAQ: SPCX) went public on June 12, 2026, in the largest IPO on record, pricing at $135 per share. Shares quickly surged to an all-time high of $225.64 just days later, briefly implying a valuation exceeding $2 trillion. The stock has since retreated sharply amid valuation concerns, lockup expiration fears, and broader market dynamics.
By early August, it traded near $108–$125, representing a roughly 50 percent decline from the peak and bringing the market capitalization closer to the $1.5–1.7 trillion range. On August 4, shares closed up more than 9 percent at $125.33 ahead of earnings before facing pressure in after-hours and premarket trading.
Short interest has climbed dramatically. According to S3 Partners data widely cited in market reports, short positions reached approximately 219.3 million shares by late July, about 34 percent of the limited public float of roughly 640 million shares, and represented a notional value of around $24.6 billion.
Utilization of shares available to borrow hit 95 percent, with borrow fees rising. This level of shorting exceeded the dollar value of short bets against Tesla at the time and built rapidly ahead of two catalysts: the company’s first post-IPO earnings and an August 6 lockup expiration that could free up to 911.5 million additional shares.
-
CEO Elon Musk has issued warnings of his own. In mid-July, as short interest approached one-third of the float, he posted that “the survival probability of firms who maintain a significant short position in SpaceX over time is very low,” reiterating his view that the company could ultimately be worth more than Earth if it achieves its goals.
On August 4, just before earnings, Musk responded to the latest short-interest data by saying, “I try to warn them, but they just double down.”
SpaceX delivered its first quarterly results as a public company after the close on August 4. Second-quarter revenue rose 92 percent year-over-year to $7.8 billion, beating consensus estimates near $6.8–6.9 billion.
The net loss narrowed to $541 million, or 9 cents per share, better than the roughly 23–24 cent loss expected. Starlink/connectivity contributed about $4.3 billion (up 66 percent), while the AI business generated $2.6 billion (up roughly 250 percent). Capital expenditures were heavy at $18.4 billion, largely tied to AI infrastructure. Management projected a $100 billion annualized revenue run rate by year-end 2026 and outlined a path toward $1 trillion in annual revenue by 2030.
The combination of Chamath’s historical reminder, Musk’s repeated alerts, and the company’s ambitious growth targets underscores the high-stakes debate surrounding SPCX. Short sellers are positioned for near-term supply pressure from the lockup, while long-term bulls point to Starlink scale, Starship progress, and AI compute expansion as reasons the bears may ultimately face the same fate as many early Tesla skeptics.
SpaceX has solved Starship’s biggest challenge, Elon Musk says
SpaceX is coming for wireless giants with Starlink Mobile
