Dan Smith

iOS QA Engineer @[email protected]

[Michael Burry Stock Tracker ♟ @burrytracker]

Buying coffee vs. investing coffee money over 11 years

[Frank Meyrath @fmeyrath]

The biggest issue is not that it doesn't have potential. It's that it's likely already priced all of its lifetime potential it's IPO valuation

Compare this to Amazon's IPO valuation which was in the high hundreds of millions or low billions.

Where does SpaceX AI go from here? Likely to the crapper. And what happens if something happens to Elon musk? What would you guess the 80 to 90% of the valuation is tied up in his cult of personality?

[P.K. Merlott @PKMerlott]

@DJ_CURFEW "Normally this would take 2 years but we were able to do it in a week."

In the dating world, this would be the equivalent of asking your date if they've read Dianetics.

[George Noble @gnoble79]

This is the most OUTRAGEOUS deal I've seen in my 45 years on Wall Street.

SpaceX just disclosed Musk's new compensation package:

He gets up to 200 million super-voting shares if SpaceX hits a $7.5 trillion valuation, establishes a permanent human settlement of at least ONE MILLION people on Mars, and deploys roughly 100 terawatts of space-based computing power.

Let me put the 100 terawatts in perspective:

The entire electricity generation capacity of the United States is around 1.2 terawatts. The comp plan asks Musk to build more than 80x America's entire power grid... in orbit.

This is a science fiction screenplay that somehow landed in front of the SEC.

But here's why it actually matters for your portfolio...

The S-1 reportedly claims a $28.5 trillion total addressable market, with over 90 percent attributed to AI. CapeFearAdvisors flagged this one cleanly: when Palantir went public, it disclosed a $119 billion TAM and the SEC reviewed and accepted it.

SpaceX is claiming a market roughly 240x BIGGER.

Now let's talk about what is actually being sold here:

Reported 2025 revenue is approximately $15.5 billion. Starlink delivers around $11 billion of that with healthy margins, and the launch business is genuinely dominant. The problem is xAI - the AI piece doing all the heavy lifting in the trillion-dollar valuation pitch.

xAI generated just $210 million of revenue in the first 3 quarters of 2025 while burning through $9.5 billion in cash.

Ben Brey and Rupert Mitchell - a former Fidelity portfolio manager and a former head of equity capital markets at Goldman and Citi between them - ran a serious discounted cash flow on the actual operating businesses and arrived at roughly $400 billion. Lawrence Fossi covered their work recently and the math holds up.

The IPO is being marketed at $1.75 TRILLION.

The gap between what these businesses support and what Musk is asking the public to pay is roughly $1.35 trillion of pure narrative.

Then layer on what we just learned last week...

The New York Times investigation revealed Musk personally borrowed $500 million from SpaceX between 2018 and 2020 at rates as low as 1%, while bank prime rates sat around 5%. The same SpaceX has been used to bail out SolarCity, prop up Tesla during cash crunches, and absorb xAI when the AI losses became unmanageable.

This is the same playbook he's run for two decades.

Use a privately controlled entity as a personal piggy bank, and when the bills come due, find new investors to absorb the losses.

The IPO is structured to keep that game going FOREVER.

The Texas reincorporation strips away Delaware's fiduciary protections. Controlled-company status on the Nasdaq eliminates independent board requirements. And retail is being offered up to 30% of the offering (3x the normal allocation) because the institutions who actually do the math are quietly stepping away.

Here is the part that finishes the case for me:

Roughly $40 billion of the IPO proceeds are already spoken for before a single dollar reaches operations. About $23 billion retires SpaceX debt. Another $17 billion retires the high-interest debt sitting on xAI and X.

This raise is not funding the future. It's just plugging existing holes that retail investors will now own.

In my 45 years I've never seen a deal where the comp hurdle is colonizing another planet.

I've never seen a disclosed TAM that exceeds verified comparables by two orders of magnitude.

I've never seen a company asking the public to fund the retirement of debt incurred by separate private entities controlled by the same individual.

Every red flag I've watched precede a major bust over four decades is sitting in this prospectus, in plain sight.

The Tesla mispricing is being repeated on a far larger scale.

And this time the bag is being handed directly to retail.

Don't be the one holding it.

[Dan Smith @dsmudger]

@joecarlsonshow Are you sure you don’t wanna come over to 🧵s? It’s pretty nice over there. Or just cross-post to both 🤷‍♂️
🇬🇧✌️📈

[Raphaël Dabadie @RaphaelDabadie]

(9/9) 🧭 Final thought

Across all eight elections, the same pattern keeps appearing: most models favor center-left, technocratic, climate-focused agendas, and consistently downrank proposals tied to conservative, populist or sovereignist movements, even when those movements win in the real world.

This doesn’t mean models should mirror public opinion, but it raises a real question: what role should democratic preferences play in systems millions now rely on to think?

[Dan Smith @dsmudger]

@John_Vanture @elonmusk Is there a place I can bet money, that (like all his grandiose claims) it won’t?

[Dan Smith @dsmudger]

@moonsewage @J7UiBMjH8b @hyhieu226 I mean when you re-evaluate something you’ve just heard yourself say, or are even still in the middle of saying.

Much like the ‘thinking model’ LLM.

“A therefore B therefore C, oh wait I’ve heard C before, and know/think it isn’t right; why is that again, oh yes because of Q”

[Dan Smith @dsmudger]

@opngate @JoyceCarolOates In slight fairness, you did get 19K impressions on this one.

Tend to think this site simply became very pay-to-play, and obvs heavily encouraged bots and low-effort engagement farming by paying for that. Just in general. Rather than targeted shadow bans. Tho I’m sure it happens

[Dan Smith @dsmudger]

@dividenddude Bought one share at $144.71. As a watcher position. Lols

[Christian Keil @pronounced_kyle]

My 2-year-old son has a new favorite book: "BUSES."

And it is the greatest example of product-market fit I have ever seen:
‣ ~30 pages
‣ zero words
‣ two poorly-cropped images of busses per page

He LOVES it.

[Daniel Ashcroft 🫳🏼 @valtism]

@theo Do people in the US think that government shutdowns are normal like tipping culture and no tax on labels or do they see the insanity of it all?

[Dan Smith @dsmudger]

@moonsewage @J7UiBMjH8b @hyhieu226 Ah yes, that’s it, just like this:

[Dan Smith @dsmudger]

@moonsewage @J7UiBMjH8b @hyhieu226 And think certainly it can be that way but also other times it can be super linear.

Like when you stop yourself mid sentence and realise you’re saying something wrong. Or when you qualify up front or just afterwards that you’re “just thinking out loud here.. wait.. err.. so..”

[Dan Smith @dsmudger]

@joecarlsonshow Good margin of safety on a DCF basis.

[Dan Smith @dsmudger]

@ahoop @unusual_whales @Polymarket I’d bet against it (/anything he says he’s going to deliver “by the end of the year”).

The issue with this one, is that “watchable” is a nebulous and easy to move goalpost.

“Well, I watched it. Ergo, it was watchable. I win the bet! Ha!” 🤷‍♂️

[Dan Smith @dsmudger]

@ijsthee @TailosiveTech Guessing no practical way from a manufacturing perspective. M5 not-pro/max are prob low-binned units.

They’d have to save them up in warehouses ‘til Pro/Max yields got acceptable. Costing $. Or charge $$$$ for the early Pro/Max, then ramp the price down. Both worse choices IMO.

[BuccoCapital Bloke @buccocapital]

I’m not surprised this has 10k likes, but I think it’s pretty bad advice. And often actively destructive to both company culture and performance. In fact, it’s a pretty employee-hostile chart and an abdication of leadership responsibility. Let me explain…

The critical assumption underpinning this entire chart is that a single individual contributor, or manager, can resolve the problem

That is very often not the case. And what happens when you create a “bring me solutions not problems” culture is that people stop bringing you problems! That is very bad!!!

There’s a great Colin Powell quote about this. I hate war analogies in business, but I think it’s relevant here:

“The day the soldiers stop bringing you their problems is the day you stopped leading them. They have either lost confidence that you can help them or concluded that you do not care. Either case is a failure of leadership”

Do you know what is a good way to get blindsided by big fucking issues? Telling people to solve everything themselves, or that they need to have proposed solutions

It is just as likely that they are feeling a *symptom* of a really big problem. Maybe they can solve the symptom. But it doesn’t solve the problem. There is a deep Root Cause Analysis exercise that should be happening. Something structural is broken. Incentives are wrong. Whole departments are misaligned on strategy. The business is missing a critical piece of infrastructure and everyone is doing a dumb workaround

Encouraging individual heroics often exacerbates these issues, and kicks the can down the road on the real problem. It is not this person’s problem to solve. It’s your problem. You’re the leader. You need to go investigate.

Most importantly though, I think this chart is an abdication of leadership responsibility. Your job is to clear blockers and drive alignment. Yes, your job is to teach people to march up this chart of self-sufficiency for problems within their scope.

But they can’t do that without a culture that allows, and even encourages just as much “Level One: There is a problem” identification as Level 5 celebration of autonomy

The way that I think about this is that everyone in my department - from the Directors down to the Individual Contributors - is on a constant journey to improve their Problem Identification ability. Is this a problem that can be solved by me, or do I need to escalate this? That’s the right filter. The number of problems that can actually be solved by an IC using this pyramid is quite small. Managers, a bit bigger. Directors, bigger still.

Lot of time wasted, and problems unsolved, because cultures are built demonizing problem identification

[Dan Smith @dsmudger]

@LeakerApple My 8-core 2013 ‘trashcan’ Mac Pro geek-benches only very marginally more than that, *in multi-core* 💀👍

[Dan Smith @dsmudger]

@jason334990 @ahhshieet @joecarlsonshow Which is quite different I think, from say, “I think your online book store (which exists and is selling books), or your capacitive touchscreen telephone, is a bit of a meh idea. I mean it’s fine, but won’t be significantly more popular or profitable in the future than it is now”

[Dan Smith @dsmudger]

@jason334990 @ahhshieet @joecarlsonshow I think people say that of TSLA as he says things like “let me be clear, we have [capability/product] ready *right now*”.

And then 5-10y later, it’s still not there.

Indicating that those statements were/are very far past the line, of just a bit of over-optimism or puffery.