Yesterday, I explained why Elon Musk might be preparing to merge Tesla and SpaceX into one enormous technology company.
A big reason for this potential merger is artificial intelligence.
By combining their AI capabilities, Musk could create a business that develops its own chips, trains its own AI models and puts that technology to work in everything from robots to rockets.
And with SpaceX already having completed the largest IPO in history, investors are clearly willing to pay enormous sums for that vision.
But Musk isn’t alone.
Two of his biggest AI competitors, OpenAI and Anthropic, are also preparing to go public. And their potential valuations are staggering.
In fact, when you put all three companies together, you get a number that’s almost impossible to believe.
This week’s chart puts it into perspective.
Three Companies Worth More Than 45 Years of Tech IPOs
This week’s chart compares the combined valuations of SpaceX, OpenAI and Anthropic with the value of thousands of technology companies when they first went public.
And the difference is shocking.
According to data compiled by University of Florida finance professor Jay Ritter, 3,365 U.S. technology companies went public between 1980 and 2025.
Add up the market value of each company on its first day of trading, and you get approximately $4.07 trillion.
Then there’s SpaceX, OpenAI and Anthropic.
Together, their actual and estimated valuations add up to roughly $5.2 trillion, which is around 28% more than the combined valuations of all 3,365 prior tech IPOs.
And remember, we’re talking about a group that includes some of the most successful technology businesses in history.
Companies like Microsoft, Apple, Amazon, Google and Nvidia all went public during that period.
Of course, this isn’t a perfect apples-to-apples comparison. We’re adding together the historical IPO valuations of thousands of companies without adjusting for inflation. And OpenAI and Anthropic haven’t completed their offerings yet.
But it’s still an extraordinary comparison. And it shows us just how dramatically the technology industry has changed.
Not long ago, most technology companies went public long before they reached anything close to a trillion-dollar valuation.
Amazon was worth roughly $438 million when it went public in 1997. Google was valued at approximately $23 billion when it debuted in 2004. Even Facebook, which had already attracted nearly a billion users by the time of its 2012 IPO, entered the public market at a valuation of roughly $104 billion.
Today, some technology companies are reaching valuations many times larger while they’re still privately held.
And AI is a major reason why.
OpenAI helped ignite the generative AI boom with ChatGPT. Anthropic has emerged as one of its strongest competitors, particularly in AI coding and enterprise applications.
Both companies are attracting enormous investment because their backers believe AI could become as essential to the economy as electricity or the internet.
Meanwhile, SpaceX has built a dominant rocket-launching business and a global satellite network through Starlink. And its acquisition of xAI has brought Musk’s Grok technology into the same company.
In other words, investors aren’t simply betting on three successful technology companies. They’re betting that these businesses could become some of the most important players in the AI economy.
And there’s another reason their valuations have grown so large before reaching public investors.
The private markets have changed.
Venture capital firms, sovereign wealth funds and other institutional investors can now provide enormous amounts of funding to companies that might once have needed an IPO to finance their expansion.
That allows businesses to remain private longer, even as their valuations climb into the hundreds of billions or trillions of dollars.
The result is that ordinary investors may not get an opportunity to buy shares until much of a company’s early growth has already taken place.
And that’s something worth thinking about as more AI giants prepare to enter the public markets.
Here’s My Take
I believe artificial intelligence will create some of the most valuable businesses in history. And SpaceX, OpenAI and Anthropic could all play enormous roles in that future.
But there’s a difference between believing in a technology and believing that any price is worth paying for the companies developing it.
A trillion-dollar valuation comes with trillion-dollar expectations.
These companies will eventually need to generate enough revenue and cash flow to justify what investors are willing to pay for them today.
And while I expect AI to create extraordinary opportunities over the coming years, I don’t believe investors should assume that every blockbuster IPO will be a blockbuster investment.
Sometimes the best opportunities come from companies that are already publicly traded, supplying the chips, energy, infrastructure and other technologies that make the AI boom possible.
That’s where I’ll continue looking for opportunities as AI reshapes the global economy.
Regards,
Ian King
Chief Strategist, Banyan Hill Publishing
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