Starlink Begins Taking Preorders, Musk Eyes IPO When Cash Flow Predictable

SpaceX is expanding the beta testing of its Starlink satellite network that will offer internet service from space. Strong performance from the company could lead to an IPO of the satellite division.

What Happened: Starlink has widened the public beta testing for its satellite internet service, reports CNBC. Starlink is owned by SpaceX, the rocket company owned and founded by Tesla Inc TSLA CEO Elon Musk.

Customers can preorder the satellite service that will cost $99 a month. The preorder is fully refundable. A reservation does not guarantee service and service could take more than six months to fulfill.

Some customers got messages saying they would be covered in late 2021, others were told not until 2022. The service is available to customers in the United States, Canada, and the United Kingdom as part of the initial public beta rollout.

Starlink rolled out a public beta in October to some customers, offering service for $99 a month and a $499 upfront cost for a kit that includes a WIFI router and user terminal.

An FCC filing last week revealed Starlink has amassed over 10,000 customers since launching the public beta testing three months ago.

Related Link: Elon Musk Vs. Jeff Bezos: World’s 2 Richest People In Battle Over Satellites

What’s Next: The SpaceX-owned Starlink segment has been rumored as an IPO target for years.

Musk told reporters in 2019 that Starlink could generate $30 billion a year in revenue, making the company a hot target for a potential IPO.

Starlink has launched over 1,000 satellites and hopes to have 4,425 in orbit by 2024. The FCC has approved 11,943 satellites to be launched by Starlink.

In September, Musk said Starlink has plans to IPO and retail investors would get top priority. The billionaire entrepreneur told a follower on Twitter to hold him to it when it comes to retail investors getting first dibs at the Starlink IPO.

“SpaceX needs to pass through a deep chasm of negative cash flow over the next year or so to make Starlink financially viable,” Musk shared on Twitter.

The CEO warned that satellite constellation companies have gone bankrupt before. “We hope to be the first that does not.”

The IPO timing could come down to the timing of the company launching all of its satellites and service to more areas. This could provide financial stability and help with projections.

“Once we can predict cash flow reasonably well, Starlink will IPO.”

Photo courtesy: SpaceX via Flickr

Posted In: CNBCElon MusksatellitesSpaceXStarLinkNewsIPOsTech

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.