Why can't we invest in privately owned Space Companies?

[BenVitale]

According to this article...

Like publically traded space companies, the number of privately owned space companies continues to grow. It is not possible to invest in privately held companies by purchasing stock, so to contribute to their success it might be worth considering directly patronizing their services, making a donation (though usually not tax-deductible), or volunteering your time or abilities.

Source: Privately Owned Space Companies

 

[russ_watters]

Typically, a company needs to become at least somewhat economically viable before it can go public. Until then, private investors hold all the risk and get all the reward.

http://en.wikipedia.org/wiki/Initial_public_offering

 

[Pengwuino]

You can invest in private corporations, space flight or not. You simply don't have the mechanisms of stock markets and brokerages and all that good stuff. You have to approach them directly to see if they'll even accept your investment. Most companies don't want public investment because by other people owning part of your company, they also have the power to make decisions and most companies simply don't want outsiders telling them how to run their business.

 

[D H]

You only asked the question in the title of the thread, Ben. So I'll ask it here:

Why can't we invest in privately owned Space Companies?

The answer is the same reason you can't invest in Cargill, LEGO, Jaguar, Chrysler, Mars (candy bar company), Toys "R" Us, ...: The stock is privately held. There is no stock for you, or anyone else, to buy. Stockholders do bring money, sometimes a lot of it, but that money comes with a price. Annual stockholder meetings, greater scrutiny from the government, hostile takeovers, the list goes on. Some companies just don't want the grief that comes with the infusion of cash.

 

[G037H3]

Start your own company.

Buy a water heater, stick a dog in it, and attach a stable propulsion mechanism to it.

Fire it into space -> ? -> profit!

 

[loseyourname]

You can invest in a company that doesn't issue stock, but you'd probably need to be involved in an angel or venture capital firm, or be a bank. Closely-held firms might issue bonds, also, but it might be difficult to find them listed anywhere for auction or purchase unless you're a preferred customer of the original underwriter and knew about them at the time of issue. Heck, even David Bowie issued bonds a few years ago, but I'm not sure who owns them or how you'd purchase them yourself. Enterprises that are as capital-intensive as space exploration are definitely not funded entirely by founder equity.

 

[BenVitale]

D.H.,
Oh, yeah, I forgot to post the question in the 'Message'.

Thanks to all of you for the input.

I looked at some of the companies in the List of private spaceflight companies

I've noticed so far that an Abu Dhabi (U.A.E.) investment company took 32% stakes in Virgin Group’s Virgin Galactic commercial space plane venture.

http://www.spacenews.com/venture_space/abu-dhabi-company-invest-virgin-galactic.html I've tweeted Tim Harford and asked him,"these private companies don't issue stocks to the general public. Why's that?" ... and his answer was: "I think the simple answer is they don't have to if they don't want to."

(Tim Harford is the author of The Undercover Economist; and is a Financial Times columnist)
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