SpaceX is buying xAI. Ever since this merger of two Musk corporations grew to become a rumor, loopy numbers like $1.5 trillion began being thrown round when discussing the entire valuation of SpaceX, so that you may sum it up by saying “Combining SpaceX and xAI will get you the largest IPO of all time!” and yeah, that’s extra believable now than ever. For reference, SpaceX’s valuation was estimated at round $800 billion lower than two months in the past.
However is that this merger as foolish because it sounds?
The mixed firm will likely be a “vertically-integrated innovation engine,” in response to a new SpaceX press launch with Elon Musk’s private signature on it. By his personal reckoning, the corporate now offers in “AI, rockets, space-based web, direct-to-mobile gadget communications and the world’s foremost real-time data and free speech platform.” One other means of claiming this may be that SpaceX is now the corporate behind vertically-landing rocket boosters, the vast majority of the satellites at the moment in orbit, very fats rockets that are likely to explode, an ISP, the microblogging app referred to as X, a sassy chatbot referred to as Grok that’s well-known for lewd pictures, and far rather more.
SpaceX will now personal, as an illustration, Grokipedia, the AI-written, anti-woke parody of Wikipedia. And bear in mind Vine, the defunct 6-second video social media app? Sure SpaceX, which possesses billions of {dollars} in Pentagon contracts and is chargeable for crewed NASA missions, now owns the rights to Vine too. Musk claims he’s bringing it again “in AI kind.”
As many have identified earlier than me, SpaceX grew to become a genuinely indispensable participant in humanity’s aerospace and house journey efforts by means of an iterative course of involving a rare variety of spectacular and public rocket explosions that just about actually wouldn’t have been tolerated if SpaceX have been a authorities company. It has at all times walked a fragile tightrope, protecting boring folks comfortable, whereas additionally topic to the foolish stuff and horrors that associate with being run by Elon Musk.
Gwynne Shotwell, the president and COO of SpaceX, has been described by the Wall Avenue Journal as “a Musk translator, particularly for officers who rely upon SpaceX however are sometimes unnerved by his actions.” In that very same Journal article, former NASA administrator Invoice Nelson—additionally a Democratic ex-Senator—referred to as Shotwell, “the regular hand” on the firm, and added, “I’ve a substantial amount of confidence in her. Due to that, I’ve a substantial amount of confidence in SpaceX.”
Again in 2022, when Musk was in the midst of shopping for Twitter in as chaotic a trend as doable, Nelson says he referred to as Shotwell, and mentioned, “Inform me that the distraction that Elon may need on Twitter shouldn’t be going to have an effect on SpaceX.”
“I guarantee you, it isn’t,” he says she informed him. “You don’t have anything to fret about.”
Now think about being Shotwell 4 years later. Twitter is now X. Final yr, the proprietary AI chatbot on X briefly began calling itself “MechaHitler” at one level, after which it generated tons of scantily-clad photos of kids. So not solely has the drama elevated, however you’re the president and COO of the corporate that made all that stuff too.
And picture Shotwell having to deal with this merger whereas Musk, the attention-starved celeb CEO of this conglomerate has spent the previous couple of days attempting to publish his means out of any penalties or disapprobation led to by the general public disclosure of emails during which he repeatedly requested Jeffrey Epstein if he may celebration on his non-public island.
So one can solely speculate what Musk’s psychological state was when he finalized the plans for this merger. However what stands out to me is that he desires buyers in xAI and SpaceX—and maybe beginning in June, future holders of publicly traded SpaceX inventory—to consider that this merger creates an organization that gels and has a unified agenda. However you may wish to take as massive of a bong rip as you possibly can earlier than you attempt to get your head round that agenda as Musk describes it in his press launch:
This rocket and AI firm will really be an AI-in-space firm, you see, as a result of, in response to Musk’s estimate, “inside 2 to three years, the bottom price option to generate AI compute will likely be in house.” In spite of everything, “in the long run, space-based AI is clearly the one option to scale.” Clearly.
However coaching fashions with house compute is just the start, as a result of Musk claims that by combining these two ideas, they’ll be “scaling to make a sentient solar to grasp the Universe.”
Corporations don’t must at all times make sense. Samsung has motels. Pink Bull has a nature journal. Konami has aerobics gyms. Typically these incongruities are affluent leftovers from a special period for a corporation, however typically they reveal the caprice or frivolity of firm management, which may be no massive deal.
However then once more, it’s not farfetched to suppose that Elon Musk’s caprice—and the truth that an economically highly effective subset of Wall Avenue bulls suppose that caprice is tantamount to knowledge—might quickly management the world’s best-funded AI firm at a time when AI is the load bearing construction propping up the entire economic system. If the IPO goes effectively (the New York Occasions’ sources say Musk hopes it’s going to increase $50 billion), that AI firm goes to be in your 401(okay) whereas it’s additionally in command of the lives of astronauts.
In different phrases, we’re headed for a time when the Wall Avenue bulls must be proper. Greater than ever Elon Musk’s caprice might must really be knowledge, as implausible as that could be. AI had higher not be a bubble if this IPO goes effectively, and the worth of Musk himself had higher not be inflated both. All of our well-being may rely upon it.
