A company is valued at 100 billion, 300 billion or perhaps even more than one trillion US dollars before ordinary investors can buy even a single share of it. In the past, an IPO was the step out of the garage and onto the big stock-market stage for many growth companies. Today, for some companies, it looks more like the moment when a long private financing round finally becomes publicly tradable. Most of it has then already happened without the investors who later join through brokers, ETFs or savings plans.
OpenAI confidentially filed documents for a possible IPO on June 8. Anthropic had already announced this step on June 1. At SpaceX, whose IPO is scheduled for June 12, there has been talk for months of a possible valuation well above one trillion US dollars. At times, there was even talk of a listing at a valuation of two trillion US dollars. Especially with new stock-market entrants, such huge numbers create only one feeling: FOMO. Something supposedly big is emerging, and anyone who is not part of it might miss the next stock-market sensation and possibly a lot of money.
It is precisely this feeling that is dangerous on the stock market. SpaceX, OpenAI and Anthropic stand for space travel, satellites, artificial intelligence, data centers, chips, data and infrastructure. Behind them are real factories, server halls, employees and expensive investments. But an important company is still a long way from being a cheap stock. Anyone who only enters at a very high valuation often buys the past return along with it.
Mega-IPOs arrive late on the public market
The classic IPO had a simple narrative for private investors: a company grows, needs capital, opens itself to the stock market, and many investors can participate in the further journey. This actually typical process no longer fits all listed companies, because for the very large growth companies, a considerable part of value creation has been shifting to private markets for years. There, venture capital funds, sovereign wealth funds, strategic investors and very wealthy investors finance the early years, and in places the valuations are simply kicked upward. The biggest returns have then already been generated.
The public market no longer necessarily gets the company at an early stage. It gets it when the company is already large enough to justify billion-dollar valuations, when further financing is required, or when early investors and employees finally want a liquid market for their shares. That is normal capital-market logic, but for private investors the entry point is different.
Anyone who was involved early in a private financing window is on a different timeline. An investor who enters at 20 billion US dollars and later sees a stock-market value of 500 billion dollars has already taken the steepest part of the route for himself. Anyone who only buys at the IPO starts his calculation at 500 billion US dollars. From that moment on, the company has to grow out of this valuation in such a way that revenue, margin, capital requirements and free cash flow fit the price.
This exact circumstance is often neglected with mega-IPOs. Many discussions revolve around the name, the founder, the technology or the size of the market. On the stock market, however, all of this always counts in connection with the price. A stock does not become better because a company becomes more important. It becomes better when the price paid leaves enough room for future profits.
An IPO creates an exit door
An IPO is often seen as access for new investors. But that neglects what happens on the other side. An IPO primarily creates liquidity. Earlier investors can place shares. Employee shares become tradable. Founders and existing shareholders receive a public market price. New shares can bring capital into the company, while existing shares can finally change hands.
Many of the early owners use this opportunity to turn their shares into money and sell. Anyone who risked capital early is allowed to realize gains later. Anyone who worked for years in a private company and received stock options eventually needs a market in order to be able to dispose of them. That is completely legitimate. So an IPO is not automatically a gift to private investors. It is a trade. On one side are buyers who are paying for a future. On the other side are sellers who already have a past with the company behind them. The higher the valuation at the IPO, the more future has to be delivered afterward.
With companies like OpenAI or Anthropic, there is a second point as well: artificial intelligence often sounds like almost unlimited scaling. In practice, operating large models costs a great deal of money. Data centers have to be built, chips bought, power contracts signed, models trained, staff paid and customers won. Software can have high margins. But AI infrastructure can also be a capital sink as long as usage, prices and productivity do not fit together.
At SpaceX, the calculation is different, but also not simple. Rockets, satellite networks, launch facilities, production, regulation, insurance and military or government contracts form an economic basis. At the same time, it remains a business with high investments, technical risks and long timelines.
Index funds can automatically become buyers later
Many private investors first see mega-IPOs as a topic for individual-stock buyers. Anyone who is not planning a direct purchase and only invests broadly through ETFs considers himself far enough away. That is not quite right. Large IPOs can later move into many people’s portfolios through index rules without these investors ever having consciously made an individual decision.
An index follows rules. If a company is included in such an index after its IPO, funds that track this index have to buy the stock. Not because the valuation is attractive, but because the rulebook requires it. That is exactly why the latest changes at index providers also matter for investors who never want to touch a single IPO stock.
On May 1, 2026, Nasdaq introduced a fast-entry rule for the Nasdaq-100. Very large new Nasdaq listings can thereby enter the index more quickly if they meet certain size criteria. Nasdaq does apply discounts in the weighting when the free float is very low, but it does not exclude a stock solely because of the low market distribution. FTSE Russell has also adopted fast-entry adjustments for large IPOs, and S&P Dow Jones decided against acceleration on June 5, 2026. For S&P indices, criteria such as trading history, profitability, free float and liquidity remain decisive.
This has a simple consequence: if a very large company with a small tradable share comes to the stock market and quickly moves into an index, automatic demand meets limited supply. Then passive funds do not buy because the stock is cheap. They buy because they have to. For investors in ETFs, this is no reason to fundamentally question index funds. But it is a reason not to confuse the packaging with a quality judgment.
A global ETF, a Nasdaq ETF or an AI ETF removes many individual mistakes from the portfolio. But it does not remove every valuation from the portfolio. When the largest and most expensive companies receive ever more weight, the investor carries this market valuation along with them. That was easy to see in recent years among the large platform, cloud, semiconductor and AI infrastructure stocks. Anyone who invested broadly automatically owned the winners. In weaker phases, the same effect works in the other direction.
Large companies can be too expensive on the stock market
With SpaceX, OpenAI or Anthropic, the temptation is particularly great to confuse size with safety. Large investors, large markets, large names and large technical ambitions feel safer than an unknown small cap. But the stock market does not reward size in itself. It rewards the development of profits in relation to the price that was paid for them.
The higher the valuation at entry, the fewer mistakes remain allowed. In AI, rising energy costs, tighter chip supply, new competition, falling model prices or regulatory interventions can be enough to damage expectations. In space travel, technical delays, launch costs, political dependencies or high capital requirements can change the calculation. In both cases, the company does not even have to fail. It is enough if reality becomes somewhat slower, more expensive or less profitable than the market had previously paid for.
A good company can always be a bad stock. Not because the business model is worthless, but because the entry price anticipates too much. Railways, the internet, solar, fiber optics, e-mobility and crypto have all triggered real developments. Nevertheless, in many hot phases, prices were paid that later did not fit the profits. With mega-IPOs, this could happen again: everyone knows the name, everyone knows the story, and everyone has a rough idea of what the company does.
The public market comes late to the table
Actually, the stock market should enable broad participation in productivity and economic growth. People should not only earn income, consume and pay taxes. They should be able to build ownership in companies. That is exactly why stocks are so important for long-term wealth creation.
If the early phases of the most valuable future companies increasingly take place in private markets, this participation becomes smaller. The early opportunity lies with investors who have access to private rounds. The broad public gets the tradable stock later. By then, the story is better known, the valuation higher and the selling interest on the other side greater.
This is not an argument against IPOs. It is an argument against mental convenience. An IPO is not a quality seal. It is a financing event, a liquidity window and a public price for a company that was previously valued for a long time outside the stock market. Anyone who understands this difference looks at big names more soberly. Does fresh capital flow into the company, or are mainly existing investors selling? How large is the freely tradable share? When do lock-up periods expire? What valuation is being called? How much revenue already exists, what margins are realistic, how high is the capital requirement and when does free cash flow arise?
Classification: Late access has its price
SpaceX, OpenAI and Anthropic can become important companies of this era. They can shape space travel or artificial intelligence for years. But that alone does not yet create a return. The coming mega-IPOs show how strongly capital markets have changed. In the past, the IPO was more often the public start of a growth story. Today, for enormous companies, it can be more the moment when private increases in value become publicly tradable. For early investors, it is an exit channel. For new investors, it is a high starting point.
Anyone who buys at such a point does not need reverence for big names, but a hard calculation. What has already been earned in the private market? What expectations are embedded in the price? How much profit can really arise in the future? And how much of it has already been paid for today?
The IPO is then not the beginning of the story. For many early capital providers, it is the moment when the story finally becomes liquid. Private investors should know exactly that before fascination with large companies makes them forget the small but decisive calculation…
