Elon Musk is discussing allocating as much as 30% of SpaceX’s initial public offering to individual investors — at least three times the usual retail slice — leaning on his rabid fan base and other loyal backers to help steady the stock after its debut, a person familiar with the matter said.

The structure of what is expected to be one of the most closely watched IPOs in years departs from the standard Wall Street playbook, and underscores Musk’s determination to shape both who owns SpaceX and how its shares trade once public, said people close to the structure, who asked not to be identified because the process is confidential.

Musk's plan, relayed to Wall Street by SpaceX Chief Financial Officer Bret Johnsen, pairs the oversized retail allocation with an unusually hands-on approach to choosing bankers, the people said.

SpaceX is assigning some firms narrowly defined roles based on personal relationships and past ties rather than allowing them to broadly compete for investors, they added, cautioning that the plan is not final and could change.

As part of that effort, Musk handpicked Bank of America to focus on domestic retail distribution, according to four people familiar with the matter.

SpaceX did not respond to a request for comment. Bank of America declined to comment.

Musk’s companies have long attracted devoted followings among non-institutional investors, a dynamic that SpaceX is seeking to harness as it prepares for its stock market debut at a valuation that could reach $1.75 trillion.

Longtime followers have drawn confidence from Musk’s history of reshaping industries by making large, early bets others once doubted. He pushed Tesla from niche electric vehicles into mass-market production and turned Starlink from a costly experiment into a cash-generating satellite network.

With SpaceX, he turned the company into a dominant force in rocket launches, advancing his ambition to make life interplanetary.

STRONG RETAIL DEMAND

Demand from retail investors is expected to be strong, spanning wealthy family offices that have backed SpaceX for years as well as smaller investors drawn to Musk's companies, the people said.

“This is one of those lifetime moments in which people may say they just have to get in,” said Rowan Taylor, managing partner of Liberty Hall Capital Partners, a private equity firm focused on aerospace and defense. The firm is not involved in the IPO.

The hype is comparable to the launch of Google in the public markets two decades ago, he said. “The appetite is a statement about investor confidence in Elon Musk.”

SpaceX is betting that those investors — many of whom have tracked the company for years in private markets — are less likely to rush for the exits immediately after listing, or engage in “pop-and-dump” trading, the people said.

In public listings, companies typically allocate no more than 5% to 10% of shares to retail investors.

Tech news website The Information has previously reported that allocation to individual investors could exceed 20%, with defined roles for banks.

WALL ST'S TARGETED MANDATES

SpaceX has assigned banks to specific investor pools and geographies in what market participants describe as a “lane” structure, directing firms to focus on defined parts of the offering rather than compete broadly across the deal.

Morgan Stanley is expected to handle smaller-ticket retail investors, among others, through its E*Trade platform. Bank of America is focused on high-net-worth individuals and family offices in the U.S., while UBS will market to those investors internationally, according to the people.

Citi is coordinating international retail and institutional distribution, working with banks with regional expertise to help sell shares to individual investors abroad, they said.

Other banks have been assigned regional roles, with Mizuho covering Japan, Barclays handling the UK, Deutsche Bank in charge of Germany and Royal Bank of Canada covering Canada, according to the sources.

SpaceX has not yet finalized the size or timing of the offering, which is expected to test investor appetite for what could be one of the largest IPOs in history.

Barclays, Citi, Deutsche Bank, Mizuho, Morgan Stanley, and RBC declined to comment.

UBS did not immediately respond to requests for comment.

The largest IPO on record so far is Saudi Aramco, which raised about $29 billion in 2019.