SpaceX Backers Face Prolonged Uncertainty Over Multi-Layered SPVs

SpaceX is scheduled to make its public debut on Friday, but the event is causing anxiety for certain backers. Many investors who supported the company through special purpose vehicles, or SPVs, do not know their true share allocations. An SPV is a structure where multiple parties pool their funds to invest in a single asset. However, the intense demand for SpaceX shares has created an unprecedented situation. Investors have formed SPVs stacked four or five layers deep.

These multi-layered structures have recently been banned by other tech companies like Anthropic and Anduril. For SpaceX backers, the reality is that investors in the lower tiers might receive fewer shares than expected. In rare cases, they might not receive any shares at all. The exact allocations will remain a mystery until the company’s post-IPO lock-up periods begin to expire over the next four months. Lock-up agreements are designed to prevent insiders from selling their stock immediately, which avoids excessive selling pressure.

Justin Ernest, the managing partner of Sabertooth Capital, stated that the first-layer SPV has thirty days to distribute stock. Consequently, each subsequent layer must wait an additional thirty days. Ernest estimated that the bottom layer might wait up to nine months for the final disbursement.

Furthermore, shares could be eroded by high administrative fees at each level. An anonymous secondary investor warned that communication is severely restricted, with individuals only knowing what happens in the layer directly above them. Trust is a major concern in these convoluted chains. Giovanni Pennetta, a former fund manager, was recently sentenced to four years in prison for fabricating access to Anduril shares. Idan Miller, a secondary market manager, predicted that if the lock-up periods expired today, several other vehicles would be exposed as fraudulent operations.