The ambitious plan could raise investor concerns about the billionaire’s responsibilities in all of his businesses.
SpaceX has approved a plan that links stock compensation for founder and CEO Elon Musk to building a colony on Mars and operating large data centers in space, Reuters has reported, citing confidential company journals.
Under the ambitious plan, Musk could be granted up to 200 million shares of preferred stock if the company reaches a valuation of $7.5 trillion and helps establish a permanent human settlement on Mars with at least one million inhabitants, according to the report on Tuesday.
Additional attractions are associated with creating a space-based computing infrastructure capable of providing at least 100 terawatts of processing power, roughly comparable to 100,000 one-gigawatt nuclear reactors operating simultaneously.
The structure means that Musk will not receive any shares unless targets are met. Goals are not tied to a set deadline as long as he remains with the company. Musk, who founded SpaceX in 2002 and is currently considered the richest person in the world with an estimated net worth of $800 billion, has drawn an average salary of around $54,000 a year since 2019, while holding tens of millions of stock options.
The compensation package comes as SpaceX is reportedly preparing for a massive IPO in June, with a possible valuation estimated at around $1.75 trillion.
Corporate governance experts cited by Reuters said the plan could raise questions for investors, especially given Musk’s leadership of many companies, including electric car maker Tesla, where his compensation is also tied to performance targets. Analysts said the deal could intensify scrutiny of how he divides his time and attention between competing businesses.
Last week, a New York Times investigation suggested that SpaceX had made loans to Musk, including borrowing backed by his assets. The newspaper said he borrowed about $500 million from SpaceX between 2018 and 2020 at below-market rates, using the company as a source of funding for other ventures such as Tesla and SolarCity.
The NYT described the arrangement as effectively turning the airline into a “piggy bank” to Musk’s vast business empire and said he may face more scrutiny from Wall Street as SpaceX prepares to go public.
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