SpaceX Took Official Step To Go Public, But Being a Public Company Isn’t What It Used To Be
By: Natalia Renta
Elon Musk’s SpaceX took the first official step to go public yesterday by confidentially filing paperwork with the Securities and Exchange Commission (SEC). Its two AI rivals, OpenAI and Anthropic, are expected to go public this year too. Even though it’s better for our financial system and our economy if large companies go public instead of operating in the secrecy of the private markets, thanks to efforts to consolidate power and strip shareholders of their rights, being a public company isn’t what it used to be.
The price of admission for companies being able to tap into public markets used to be increased transparency and accountability to their new dispersed shareholder base. But these three companies vying to hone technologies that could reshape our economy and our lives are poised to go public at a time when policymakers have dramatically weakened checks and balances on the behavior of corporate insiders at the behest of Musk, venture capital (VC), private equity (PE), and other powerful interests.
This means the founders of these companies, their VC and PE backers, and Big Tech companies with substantial existing equity are set to be in the driver’s seat of the development and deployment of AI, with very little chance for regular shareholders or anyone else to weigh in. This creates numerous opportunities for self-dealing and consolidated control over critical decisions that benefit insiders over workers saving for retirement and the broader public.
Although we don’t have full information about the governance structures of SpaceX, OpenAI, and Anthropic, we know that their founders — Elon Musk, Sam Altman, and siblings Dario and Daniela Amodei respectively — exercise significant control over their companies. We also know that VC and other PE firms are large shareholders. For example, Peter Thiel’s Founders Fund and Valor Equity Partners have significant stakes in SpaceX. Big Tech companies are also large investors: Microsoft has a significant stake in OpenAI, Google in Anthropic, and Amazon possibly in both.
SpaceX is incorporated in Texas, and OpenAI and Anthropic are incorporated in Delaware. Both states, in addition to Nevada, have actively participated in a corporate law race to the bottom by changing their laws to make them friendlier to corporate insiders in an attempt to get more company incorporations and the franchise fees that come with them.
Locking in control
A tried and true method for founders and other insiders to retain control even after opening up more shares to outsiders is by issuing special classes of shares with much higher voting rights. For example, Larry Page and Sergey Brin together have 90 percent of voting power at Alphabet, Mark Zuckerberg has over 60 percent voting power at Meta, and Chairman Peter Thiel, CEO Alex Karp, and software engineer Stephen Cohen control just under 50 percent of Palantir. It would not be surprising if Musk, Altman, and the Amodei siblings decide to take a similar approach when their companies go public. This could mean regular shareholders are shut out of having even the smallest say in significant decisions such as director elections, mergers, how much these founders pay themselves, related party transactions, and how AI will be deployed.
To make matters worse, as of 2024, Delaware allows companies incorporated in their state to enter into contracts granting prominent shareholders the right to make decisions historically reserved for boards of directors. The basics of corporate law are that shareholders elect boards of directors, which in turn hire and oversee executives. These directors owe a fiduciary duty to all shareholders. Contracts that allow individual shareholders to unilaterally make important corporate decisions upend this structure. Delaware made this change to their law at the behest of VC and other PE firms to quickly overturn a decision by a Delaware judge that a shareholder could not contractually usurp a long list of critical decisions belonging to boards of directors.
In practice, this means that founders like Sam Altman, VC and PE backers like Andreessen Horowitz or Valor Equity Partners, and Big Tech shareholders like Amazon could enter into contracts that give them the final say on whether a public AI company makes new investments, amends its founding documents, hires or fires executives, incurs new debt, issues new stock, pays dividends, and much more, even if these decisions go against the interests of the average shareholder.
Keeping regular investors in the dark
SEC and state corporate law changes driven by Musk, VC, PE, and other powerful interests have also made it so that regular investors have much less access to critical information about the companies they are considering investing in or already own. The SEC dramatically expanded the ability of companies to file the public offering paperwork confidentially, giving investors much less opportunity to kick the tires before making the decision whether or not to purchase shares. Also, NASDAQ just changed its rules to allow large companies that recently became public to be included in a very popular index in a much faster timeline, creating the conditions for regular investors to own potentially overvalued shares of companies before the market has had a meaningful chance to evaluate them. To make matters worse, the SEC is also laying the groundwork to water down corporate disclosure requirements, which would leave regular shareholders even more in the dark about the companies they’re invested in, including the risks the company faces, conflicted transactions, insider trading policies, and executive pay.
On the state corporate law side, Delaware, Texas, and Nevada have all changed their laws to restrict the ability of shareholders to access a company’s internal documents through “books and records requests,” which are often necessary for shareholders to get information they need to uncover wrongdoing and bring a lawsuit against an insider. Delaware recently changed its law to significantly restrict the type of documents shareholders can request, Texas prohibits these requests as a way to get information to bring a lawsuit challenging wrongdoing, and Nevada all but prohibits them under any circumstances.
This all boils down to shareholders and the public having limited visibility into the companies shaping the future of AI and making up a significant share of stock market activity, even once they are publicly traded.
Shutting off access to courts
Even if regular shareholders are somehow able to uncover wrongdoing, their ability to get redress through the courts is getting shut off. In September 2025, the SEC made an about-turn on its position on shareholders’ ability to have their day in court in cases of corporate fraud and misconduct. Now, the agency will effectively allow corporations to go public with provisions that force shareholders into arbitration, which are confidential, one-off proceedings that are expensive, opaque, and tilted in favor of repeat corporate players. To add insult to injury, in a thinly-veiled attempt to push states to allow forced arbitration, SEC Chairman Atkins underscored that Delaware prohibits forced arbitration and wondered aloud what Texas will do.
Another significant block to the courts comes from a Texas law allowing corporations to amend their bylaws to require a three percent ownership stake in order to bring a shareholder lawsuit. That threshold may not sound like much, but that means someone would have to own tens of billions of dollars worth of shares in the big AI companies to be able to have their day in court.
Even for those able to bring a case to court, their ability to win may be significantly impeded. Passed in 2025, Delaware’s infamous SB21 makes it easier for corporate insiders to escape scrutiny for conflicted transactions that can harm regular shareholders. Even though Musk had reincorporated Tesla in Texas by then, the new Delaware governor said “It’s really important we get it right for Elon Musk” when pushing the state legislature to pass SB21. Texas and Nevada’s standards are even laxer, with extremely high legal standards protecting insiders from liability.
All of this adds up to founders, VC and PE firms, and Big Tech being able to make self-serving decisions that harm workers saving for retirement without meaningful accountability.
What can be done
When the balance of power shifts in the federal government, instead of trying to exempt AI from state regulation, Congress should legislate strong standards so AI is developed and deployed in the public interest, not according to the idiosyncrasies of founders and the financial interests of their VC, PE, and Big Tech backers. A critical part of this effort needs to be to set a corporate governance floor for AI companies (and public companies more generally) so that regular shareholders, workers, and affected communities have the power to further their interests in decisions that will significantly affect their lives. States also need to step up, regulating AI in the public interest, resisting the corporate law race to the bottom, and strengthening and deploying their corporate accountability tools.