The Mega-AI IPO Valuation Debates Begin! ARD #82

Michael Parekh AI: Reset to Zero

20 hours ago

16 MIN READ

The Mega-AI IPO Mega-Wave is on the calendar. Now the valuation debates begin.

Three trillion-dollar names — SpaceX/xAI, OpenAI, Anthropic — sprinting to file. Each one comes with a very different valuation argument now sitting on the analyst desks. Rev up those spreadsheets — there’s going to be a lot of IPO matrix math ahead.

Paraphrasing Warren Buffett and Benjamin Graham, there’s a lot of risk/return valuation voting and weighing to wade through. Today’s post and podcast is just a step in this ongoing exercise ahead.

Three Takes today, one on each of the trillion-dollar names. Plus a Gadget AI on Oura, the smart-rings leader, filing for IPO at $11+ billion. Plus a two-question reader segment on the wearable I actually use the most + the one feature I wish all health wearables had.

(1) SpaceX / xAI — Starlink Doing the Heavy Lifting

SpaceX/xAI. The IPO filing dropped last week. Now the valuation debates begin.

The Information ran the marquee analytical piece this week — “Why SpaceX is worth $700 billion, not $1.75 trillion” — and the headline is the whole thesis. The Information argues a sober DCF on the consolidated SpaceX/xAI entity lands at roughly $700 billion, not the $1.75 trillion Elon is pitching to passive-index investors.

The Wall Street Journal ran the supporting piece — “Starlink is making all the money” — saying the quiet part out loud: Starlink’s broadband cash flow is the only fundamentally-driven business in the consolidated entity. Everything else — Mars, Starship, xAI/Grok — is narrative-driven optionality.

Veteran tech analyst Om Malik captured it in his piece “The Rocket That Runs on Broadband” — riffs well on the same notes.

For longtime readers — I framed the Starlink-pitch realities in AI-RTZ #1007, “Elon Musk SpaceX/xAI IPO Starlink”. The boundless-ambitions context is in AI-RTZ #1066, “Elon’s Boundless AI Ambitions”. And the canonical “robots-and-robotaxis still in the concept stage but getting trillion-dollar narrative valuations anyway” pattern is in AI-RTZ #510, “Tesla’s Robotaxi and Robots Ride”.

MP Take: Think the Information trillion-dollar number above is in the right direction. Public markets show that a trillion-dollar premium to fundamental, secular valuations can persist for a long time — when driven by a broad institutional and retail following of believers. Tesla is a case in point — where fundamental analysts have long argued its valuation is over a trillion dollars too high based on its core auto business. Robots and Robotaxis are still in the concept stage, yet institutional analysts and investors are awarding them a trillion-dollar valuation based on the Elon Musk “financial anti-gravity narrative machine.” So SpaceX/xAI can also execute that playbook — as long as investors play the Elon Musical Chair game, and the music continues to play under the stars.

(2) OpenAI — Threading the Needle Between Consumer and Enterprise AI

OpenAI. Confidentially filed for September 2026 last week. Now the valuation question.

TSG Invest has been the most-circulated pre-IPO valuation tracker on OpenAI for analysts and retail traders working through the secondary-market dynamics ahead of the filing reveal.

Axios ran the broader retail-buyer risks piece this week — “AI mega-cap IPOs and retail buyers” — covering how the three trillion-dollar IPOs are likely to land with the retail allocation side of the demand curve. Worth reading for the structural read on retail-vs-institutional dynamics across all three.

I assessed OpenAI’s IPO odds in detail in AI-RTZ #1021, “OpenAI IPO Prospects Assessed” — the framework there is the substrate for today’s Take.

MP Take: OpenAI has a lot more fundamentals and momentum under the hood — despite recent “side quest” issues. Its broader ambitions — both consumer and enterprise, devices and all — are barely sheathed. Despite all the headwinds, OpenAI still has some of the best AI talent in the world, and products to prove it. Although it is fighting to keep its “Coke” vs Anthropic’s “Pepsi” spot, it maintains an iconic global brand in ChatGPT. Much to do to merge ChatGPT with AI Coding product Codex, and then morph that into an AI “Super-App.” Then presumably make all that and more available on its own OpenAI AI Smartphone and portfolio of AI devices. Against Apple and Google both. Build unprecedented amounts of AI Compute with Partners, and own AI Chips. Oh, and still maintain core focus and discipline on financial execution barely four months ahead of an IPO filing. An AI Marathon indeed.

(3) Anthropic — Rocking a Developer-Driven Global Enterprise Lead

Anthropic. The third of the trillion-dollar IPO trifecta. October window.

Implicator AI ran a useful valuation read this week — “Anthropic weighs $950 billion after SpaceX, Amazon and Google deals” — pinning the post-compute-deals pre-IPO valuation at roughly $950 billion.

Seeking Alpha had the secondary-market read — “Anthropic’s pre-IPO valuation tops $1T in private trading” — flagging that private-trading desks are already marking the company above $1 trillion ahead of the October filing window.

I framed the Anthropic-vs-OpenAI half-of-2026 dynamic in AI-RTZ #1079, “Anthropic and OpenAI Half of 2026” — which gives you the comparative-positioning frame ahead of the October Anthropic file + September OpenAI file collision.

MP Take: Anthropic remains the tortoise outrunning the OpenAI hare. The last six months have shown how fast positions can change in this market — with Claude Code and Cowork coming from “nowhere” to take over a multi-billion-dollar global market that barely existed two years ago. And a I’ve said before, they’ve got a bead on the consumer market, as a through line via the enterprise door. Brand name ‘Claude’. All that, and It’s still months away until October when Anthropic files. Meanwhile, the revenue ramp continues to $50+ billion ARR in June. All as Anthropic aggressively signs up AI Compute as fast as possible — stretching its ability to scrounge said compute from sources as unexpected as Elon Musk’s SpaceX/xAI. It all points to the company’s speedy and crafty execution. An AI Safety North Star-driven founding team remains positioned to take the lead spot in the mega-AI IPO from where we sit today.

Gadget AI — Smart Rings Leader Oura Files for IPO at $11+ Billion

Bloomberg broke the filing detail this week — “Oura, maker of popular smart rings, files confidentially for IPO” — pegging the filing at roughly $11+ billion valuation.

For the broader wearables competitive context — ZDNET ran a useful comparative read this week — “Google Fitbit Air vs Whoop” — covering the screenless, wrist-based fitness tracker category where Whoop and the new Google Fitbit Air compete on a subscription-plus-hardware model adjacent to Oura’s ring form factor.

For longtime readers — I covered the Apple-Oura-and-AI-Smart-Rings positioning in AI-RTZ #550, “Apple, Oura and AI Smart Rings”. And the Apple healthcare-devices context is in AI-RTZ #404, “Apple Watch and AI Healthcare”.

MP Take: This is an opportunistic move by Oura given the current environment for AI Devices enthusiasm. Early adopter users have embraced Oura rings — much like Meta’s early success with 3 million+ AI Smart Glasses sold to date. The Health devices category is a big one with Apple and Google the two “gorillas” in the US. Their Watch and wrist-based devices go up against similar functionality offered by smart rings. Also in the mix is private company Whoop — with their health fitness wrist brand and subscription model. That is the other private company to watch in the space amongst the “elephants” in healthcare devices.

Questions

Q1 — What health wearable does MP use the most?

Answer: The Apple Watch Ultra remains my core wearable here.

Addicted to the Apple Rings for daily health-habit discipline. It’s now second nature to continue the daily streak for months on end.

Q2 — What’s the one wearable-health feature most wished for?

Answer: Automated way to enter daily food intake via a smartphone camera feature. Where the software takes care of estimating and entering everything off a single picture.

This will likely become a possible application on AI Smart Glasses and AirPods camera app. But can be done with smartphone cameras today.

MP Take: The food-camera wish will likely become a possible application on AI Smart Glasses and the AirPods camera app first. But can likely be done with smartphone cameras today — and is the single biggest unlock for the daily-habit-tracking layer that all the wearable hardware companies are competing to own.

Shorts Clips from today

Clip 1 — Elon’s Anti-Gravity Financial Machine

Watch on YouTube Shorts

The Information argues SpaceX is worth $700 billion, not $1.75 trillion. WSJ says Starlink is making all the money. Om Malik calls it “The Rocket That Runs on Broadband.” The rest of the SpaceX/xAI bundle — Mars, Starship, Grok — is narrative-driven optionality on top of the broadband cash flow.

MP Take: Think the Information $700 billion direction is right. But public markets show a trillion-dollar premium to fundamentals can persist a long time when driven by broad institutional and retail believers. Tesla is the case in point — Robots and Robotaxis still in concept stage, yet awarded trillion-dollar valuation on the Elon “financial anti-gravity” narrative machine. SpaceX/xAI can execute that same playbook — as long as investors play the Elon Musical Chair game, and the music continues to play under the stars.

Clip 2 — Anthropic’s $40B AI Deal with Elon

Watch on YouTube Shorts

Anthropic eyes October IPO. Implicator AI pegs the post-compute-deals pre-IPO valuation at roughly $950 billion. Seeking Alpha says private-trading desks are already marking the company above $1 trillion. And the through-line: Anthropic aggressively signing AI Compute as fast as possible — stretching to sources as unexpected as Elon Musk’s SpaceX/xAI on a $40+ billion deal.

MP Take: Anthropic remains the tortoise outrunning the OpenAI hare. Claude Code and Cowork came from nowhere to take over a multi-billion-dollar global market that barely existed two years ago. Revenue ramp continues to $50+ billion ARR. Anthropic scrounging compute from sources as unexpected as Elon Musk’s SpaceX/xAI points to speedy and crafty execution. An AI Safety North Star-driven founding team remains positioned to take the lead spot in the mega-AI IPO from where we sit today.

Clip 3 — Oura & Whoop’s IPO Plans

Watch on YouTube Shorts

Bloomberg broke it — Oura, the smart-rings leader, files confidentially for IPO at roughly $11+ billion. ZDNET ran the comparative read on Google Fitbit Air vs. Whoop. The wearables-IPO category is suddenly hot — three viable smart-ring and wrist-tracker plays converging on the public market window.

MP Take: This is an opportunistic move by Oura given the current environment for AI Devices enthusiasm. Early-adopter users have embraced Oura rings — much like Meta’s early success with 3 million+ AI Smart Glasses sold to date. Health devices is a big category with Apple and Google the two gorillas in the US. Watch and wrist-based devices go up against similar functionality from smart rings. Whoop with their subscription model is the other private company to watch amongst the elephants in healthcare devices.

Clip 4 — The AI Smart Ring’s Rise

Watch on YouTube Shorts

The AI smart ring form factor went from niche to IPO-ready in two years. Oura at $11+ billion confidential filing. Whoop holding the subscription-plus-hardware ground. Apple and Google the gorillas with Watch and wrist-based devices. The full positioning map across the wearables category gets concrete.

MP Take: Health devices is a big category. Apple and Google the two gorillas in the US — Watch and wrist-based devices go up against similar functionality from smart rings. Whoop with their health fitness wrist brand and subscription model is the other private company to watch amongst the elephants. The Apple Watch Ultra is MP’s core wearable — addicted to the Apple Rings for daily health-habit discipline.

Have a great weekend. Monday — ARD 83 on AI-RTZ #1097. Stay tuned.

NOTE: The discussions here are for information purposes only, and not meant as investment advice at any time. Thanks for joining us here.

Links

Theme — Mega-AI IPO Valuation Debates (overall framing)

Axios — AI mega-cap IPOs and retail buyers (cross-Take umbrella): https://www.axios.com/2026/05/20/spacex-openai-anthropic-ipos

Take 1 — SpaceX / xAI — Starlink Doing the Heavy Lifting

The Information — “Why SpaceX is worth $700 billion, not $1.75 trillion”: https://www.theinformation.com/newsletters/the-briefing/spacex-worth-700-billion-1-75-billion?rc=fzcdtg
WSJ — “Starlink is making all the money”: https://www.wsj.com/business/starlink-spacex-ipo-elon-musk-967fba39?mod=hp_lead_pos8
Om Malik (On My Om) — “The Rocket That Runs on Broadband”: https://om.co/2026/05/21/the-rocket-that-runs-on-broadband/
AI-RTZ #1007 — Elon Musk SpaceX/xAI IPO Starlink (backcat):

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AI: Elon Musk SpaceX/xAI IPO’s Starlink pitch realities. RTZ #1007

I’ve written extensively of late, on how Elon Musk has been building up his ‘AI Data Centers in Space’ narrative of late for his recently recreated SpaceX/xAI. A potentially big milestone mega-IPO to come in this AI Tech Wave. After recent shell games with…

3 months ago · 5 likes · Michael Parekh

AI-RTZ #1066 — Elon’s Boundless AI Ambitions (backcat):

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AI: Spacex/xAI IPO filing outlines Elon’s boundless AI Ambitions. AI-RTZ #1066

So many AI balloons being floated in Elon Musk’s SpaceX/xAI confidential IPO S-1 filing. Especially driven by xAI/Grok’s AI priorities over SpaceX/Starlink. Let’s unpack…

a month ago · 8 likes · Michael Parekh

AI-RTZ #510 — Tesla’s Robotaxi and Robots Ride (backcat):

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AI: Tesla’s ‘Robotaxi & Robots’ Ride. RTZ #510

In the last few days, one founder/CEO showing a glimpse into the future ‘stuck the landing’, while the other one ‘crashed and burned’. The former of course was Mark Zuckerberg with a preview of his $10,000++ AR (artificial reality) glasses, available in ‘a few years’. The latter was Elon Musk…

2 years ago · 4 likes · Michael Parekh

Take 2 — OpenAI — Threading the Needle Between Consumer and Enterprise AI

TSG Invest — OpenAI pre-IPO valuation tracker: https://tsginvest.com/openai/
AI-RTZ #1021 — OpenAI IPO Prospects Assessed (backcat):

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AI: OpenAI IPO prospects assessed 6 months early. RTZ #1021

The handicapping on Wall Street is getting louder…

2 months ago · 5 likes · Michael Parekh

Take 3 — Anthropic — Rocking a Developer-Driven Global Enterprise Lead

Implicator AI — “Anthropic weighs $950 billion after SpaceX, Amazon and Google deals”: https://www.implicator.ai/anthropic-weighs-950-billion-after-spacex-amazon-and-google-deals/
Seeking Alpha — “Anthropic’s pre-IPO valuation tops $1T in private trading”: https://seekingalpha.com/news/4580143-anthropics-pre-ipo-valuation-tops-1t-in-private-trading
AI-RTZ #1079 — Anthropic and OpenAI Half of 2026 (backcat):

half of $2 trillion in Cloud Co backlogs. AI-RTZ #1079″,”truncated_body_text”:”I’ve discussed the intensifying ‘Coke vs Pepsi’ competition between Anthropic and OpenAI ahead of their respective trillion dollar each, mega-AI IPOs later this year. All as Elon Musk races to get SpaceX/xAI public by June with a $1.75+ trillion IPO.”,”date”:”2026-05-07T05:02:49.403Z”,”like_count”:12,”comment_count”:0,”bylines”:[{“id”:37467,”name”:”Michael Parekh”,”handle”:”michaelparekh”,”previous_name”:null,”photo_url”:”https://bucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com/public/images/608453d4-b43c-4981-929c-ac64bd59c50c_400x400.jpeg”,”bio”:”Tracking every tech wave since 1982. Daily AI analysis from an ex-Goldman Sachs Partner. 1,000+ posts & counting. What’s being created, why it matters, who’s doing it, where it’s going, and how to make it count.”,”profile_set_up_at”:”2021-09-09T10:50:46.889Z”,”reader_installed_at”:”2022-03-09T14:46:22.002Z”,”publicationUsers”:[{“id”:617936,”user_id”:37467,”publication_id”:684161,”role”:”admin”,”public”:true,”is_primary”:true,”publication”:{“id”:684161,”name”:”AI: Reset to Zero”,”subdomain”:”michaelparekh”,”custom_domain”:”www.michaelparekh.com”,”custom_domain_optional”:true,”hero_text”:”Tracking every tech wave since 1982. Daily AI analysis from an ex-Goldman Sachs Partner. 1,000+ posts & counting. What’s being created, why it matters, who’s doing it, where it’s going, and how to make it count.”,”logo_url”:”https://substack-post-media.s3.amazonaws.com/public/images/fc611a35-7a1a-4559-829c-3d16f4dc3546_804x804.png”,”author_id”:37467,”primary_user_id”:37467,”theme_var_background_pop”:”#B599F1″,”created_at”:”2022-01-12T16:14:30.751Z”,”email_from_name”:”Michael Parekh”,”copyright”:”Michael Parekh”,”founding_plan_name”:null,”community_enabled”:true,”invite_only”:false,”payments_state”:”disabled”,”language”:null,”explicit”:false,”homepage_type”:”newspaper”,”is_personal_mode”:false,”logo_url_wide”:null}},{“id”:5452281,”user_id”:37467,”publication_id”:5345150,”role”:”admin”,”public”:true,”is_primary”:false,”publication”:{“id”:5345150,”name”:”Michael’s Substack”,”subdomain”:”airambling”,”custom_domain”:null,”custom_domain_optional”:false,”hero_text”:”My personal Substack”,”logo_url”:”https://bucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com/public/images/608453d4-b43c-4981-929c-ac64bd59c50c_400x400.jpeg”,”author_id”:37467,”primary_user_id”:null,”theme_var_background_pop”:”#FF6719″,”created_at”:”2025-06-15T16:41:19.956Z”,”email_from_name”:null,”copyright”:”Michael Parekh”,”founding_plan_name”:null,”community_enabled”:true,”invite_only”:false,”payments_state”:”disabled”,”language”:null,”explicit”:false,”homepage_type”:”newspaper”,”is_personal_mode”:false,”logo_url_wide”:null}}],”twitter_screen_name”:”MParekh”,”is_guest”:false,”bestseller_tier”:null,”status”:{“bestsellerTier”:null,”subscriberTier”:1,”leaderboard”:null,”vip”:false,”badge”:{“type”:”subscriber”,”tier”:1,”accent_colors”:null},”paidPublicationIds”:[277517,6349492,6647671,1373231],”subscriber”:null}}],”utm_campaign”:null,”belowTheFold”:true,”type”:”newsletter”,”language”:”en”,”source”:null}” data-component-name=”EmbeddedPostToDOM”>

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I’ve discussed the intensifying ‘Coke vs Pepsi’ competition between Anthropic and OpenAI ahead of their respective trillion dollar each, mega-AI IPOs later this year. All as Elon Musk races to get SpaceX/xAI public by June with a $1.75+ trillion IPO…

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