Houston expert shares how to implement thought leadership into your B2B marketing

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What is thought leadership and how can it help you achieve your marketing goals? This Houston expert explains. Photo via Getty Images

Did you know that 52 percent of decision-makers and 54 percent of C-level executives spend an hour or more per week reading thought leadership content? This is according to a recent Edelman and LinkedIn survey on thought leadership.

I often counsel my clients about the role of thought leadership in B2B marketing. Thought leadership remains a strategic approach that can set a company apart, establish credibility and a strong brand voice and position it as a trusted expert in its industry. But what exactly is thought leadership, and how can it support a B2B marketing strategy?

Why a thought leadership strategy matters

Thought leadership marks a commitment to provide value through insights beyond mere selling. It involves producing content and ideas that address the company's target audience's most pressing challenges and questions. This content helps position the company as a service partner, go-to resource and industry advisor.

Builds credibility and trust: Trust remains vital in a B2B context where longer sales cycles and purchasing decisions undergo scrutiny. Thought leadership lets a company demonstrate its expertise, solution-based thinking and value meaningfully to decision-makers. According to industry data, an estimated 75 percent of decision-makers say an organization's thought leadership content is more trustworthy for assessing its capabilities and competencies than its marketing and product sheets.

Differentiates from competitors: By sharing insights, a company can differentiate itself in a crowded market. Thought leadership helps companies stand out by proving their deep understanding of the customer's challenges and needs and the solutions available for more efficient and cost-effective operations.

Enhances brand awareness: Regular publication of insightful content, whether through blogs, webinars or white papers, can increase brand visibility and keep the company top of mind for customers and potential customers.

Supports sales efforts: Well-crafted thought leadership content can powerfully warm up leads. It provides sales teams with material that resonates with prospective customers' pain points and aspirations. According to the Edelman report, nine in 10 decision-makers and C-suite executives said that they are moderately or very likely to be receptive to sales or marketing outreach from a company that consistently produces high-quality thought leadership.

How to implement a thought leadership strategy

Identify key insights and topics: Start by understanding the questions and challenges the target audience faces. Use this insight to create content that addresses these issues, offers solutions or provides novel perspectives. Include strong research and data, and offer case studies or practical steps. Depending on where the audience spends its time, consider publishing on LinkedIn, industry blogs, podcasts or webinars.

Remember that consistency is key: Thought leadership isn't a one-and-done approach. Build an ongoing and consistent content program. Keeping to a schedule helps maintain audience engagement and reinforces the organization's position as an industry leader.

Measure and adapt: Like any marketing strategy, measuring the effectiveness of your thought leadership efforts remains critical. Setting clear objectives provides the foundation for defining success and measuring outcomes effectively. Metrics could include media coverage, website traffic, social media engagement and business development leads. Additionally, sales impact can be measured by actions such as first-time discovery calls and sales-qualified leads.

Thought leadership proves an invaluable strategy for B2B marketing. It aims to assert the expertise of a company and build meaningful connections with its audience. A business can establish a strong, credible brand that attracts and retains customers by providing valuable insights and solving real-world customer challenges through high-quality content.

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Melanie Taplett provides communications and public relations services to the energy, manufacturing, technology, engineering and construction industries. Contact her at mtaplett@taplycom.com.

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Two seasoned public relations experts are providing resources for startups and small businesses. Photo courtesy of All You Need Method

Two female founders create a PR solution for startups and small businesses in Houston and beyond

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Public relations can feel elusive and overwhelming to small business owners. Carla Nikitaidis and Kathryn Worsham Humphries, two seasoned communications consultants, are used to hearing clients ask if they need PR — and more often than not, "what does PR even mean?"

The two women are lifting integrated marketing's curtain to help early-stage businesses and entrepreneurs understand and implement their own communication plans. Houston-based Humphries and California-based Nikitaidis launched All You Need Method, an online course and consulting business designed for small business owners, to help provide agency-level strategy without the expensive price tag.

All You Need Method compiles Nikitaidis and Humphries years of communications experience into an accessible course, The PR Starter Kit.

"We packaged it together in a way where if you're the founder of a small business, you can take our course and get started down the right path of telling your story, being strategic, setting goals, and growing your brand," explains Humphries.

The $249 course is a small sum compared to the often costly prices of hiring on a PR agency, which Humphries explains have monthly retainers ranging from $3,000 to $20,000. The price point is much more manageable for a small company, she explains.

The partners first crossed paths in New York City, sharing a mutual love for PR. Nikitaidis worked for a string of large agencies, representing popular brands like Target, CVS, and Shiseido. Humphries, a University of Texas graduate, landed in Manhattan to fulfill internships at Ralph Lauren, Teen Vogue, and Lonny magazine.

When Nikitaidis left her agency role to start CMN PR, a firm focused on early-stage businesses, and brought Humphries on as her first employee. "She was so smart and strategic — such a partner from day one," says Nikitaidis.

After five years of CMN PR, the two joined a client's in-house team and, eventually, departed to their own adventures. Humphries joined the global social media team for Gap Inc. and eventually returned to Houston to start her consultancy, KWH Creative. Nikitaidis became director of communications at Nextdoor, in the early days of the app, and vice president at The OutCast Agency in San Francisco before relaunching her company as CMN PR & Consulting in 2020.

Nikitaidis and Humphries met in New York years ago and have worked together in the past. Photo courtesy of All You Need Method

When the coronavirus started, the two women realized that small businesses were struggling more than ever. They set out to create tools for the early-stage entrepreneur and even business owners reassessing their plans in the wake of 2020's hardships.

"There are so many businesses that are pre-PR agency or even pre-consulting services that just need a little bit of help. They don't need a $5,000 or $10,000 monthly retainer — what they need is some strategic guidance," says Nikitaidis.

All You Need Method seeks to democratize access to media for solopreneurs on a budget.

"We're not anti-PR agency," Nikitaidis stressed. "We just think that the system and how it's kind of set up right now is broken."

Traditionally, publicists have been the conduit between brands and the media. Through press releases and pitches, communications professionals build relationships with reporters to help the brands they represent get media coverage. The Public Relations Journal even sought to investigate the role of PR gatekeepers in a 2011 study.

"If you think about how agency life has evolved, you used to have to go through an agency to have access to media. Now that the conversation is completely broken down — you don't need a third-party to have that conversation," continues Nikitaidis.

Before reaching out to the media or unveiling a product, Humphries believes you should have "core foundational pillars in place." The PR Starter Kit course guides our seven-step formula the two founders have used with their clients to help them stand out in a crowded media landscape. The course provides customized templates, a competitive analysis, content creation tips, and clarity on how to use integrated marketing to reach your business goals.

The PR Starter Kit includes approximately one hour of video training and worksheets that could take an estimated five hours to complete. The videos are broken up into segments so "you can go at your own pace" overtime, suggests Nikitaidis.

For a personalized approach, All You Need Method also offers one-hour strategy sessions via Zoom for $250. The consultation process answers PR and marketing questions pertaining to the brand's business, addresses individual pain points, and focuses on bonus goals.

"We're always trying to map back or help small business owners approach PR and marketing as something that's going to move their business goals forward," Nikitaidis added.

Building customer relationships and servicing your clients may sound like "Business 101," but Humphries finds that 2020 has shifted the needs of brand audiences and their lifestyles.

"I feel like a lot of small business owners have a vague idea of who their target audience is, but they haven't actually sat down and drilled down on all the details," explains Humphries.

Especially in light of the coronavirus pandemic, consumer behavior has changed. She recommends understanding what they could most use from you right now based on your areas of expertise and your product or service.

The coronavirus isn't the only nationwide hardship that's forcing brands to reevaluate their content and values. Last May, the Black Lives Matter movement held protests across the country in the wake of George Floyd's murder. Conversations on racial justice and police brutality took place on the ground, in news outlets, and across social media platforms. While the movement was amplified on social platforms, some brands fumbled responses and social media statements that critics felt were inauthentic.

"There was just this total lack of awareness in terms of the different industries, specifically fashion and beauty. I hope that it was a big wake up call," says Nikitaidis, who emphasized All You Need Method's commitment to inclusivity. The company recently interviewed thought leader and marketer, Sonia Thompson, for tips on building an inclusive brand.

Inclusivity, and the messaging surrounding it, was a problem that existed long-before last summer and has continued on. From the Dallas-based mahjong brand that sparked a debate on cultural appropriation to the racial missteps of fashion brands, embracing inclusivity with half-hearted gestures has led brands to come under fire.

"I think a big part of being an inclusive brand and having it be authentic is relationship building and making sure that you're building relationships with a diverse audience and customers that don't look just like you," explains Humphries. She challenges people to make "a conscious effort to expand your circle and to make other people feel welcome."

From a global pandemic, political divisiveness, racial justice revolutions, the growing climate crisis, and an insurrection at the nation's Capitol, there's, well, a lot of events to consider when creating social media content.

To Nikitaidis, authenticity and consistency go a long way.

"Reevaluate your core values, and then make sure that you show up with intention in every single solitary thing that you post, that you put out there, and that it's consistent," she says. "If there is a cause that you really care about, and that really is a natural fit with your core values, then you become a thought leader in that space and it's not contrived."

While 2020 might have been a shock to the system for some, it also ushered in new platforms that the two believe could shape marketing's future.

Nikitaidis is excited about what Clubhouse, an audio-chat social networking app, could mean for the future of social platforms. She describes the app as a vibrant dinner party with your 10 coolest, most interesting contacts... except everyone can listen in.

The invitation-only app, which launched last April, features a variety of virtual rooms with conversations on topics like music, social media marketing, business, politics, dating, and more. The Verge likens it to "Medium for podcasts," while reporting on Elon Musk's debut on the chat platform.

"I think the podcast market is awesome but I think that's becoming a little oversaturated. I'm interested and excited to see where these other digital platforms are popping up and how people will be socializing or communicating or connecting in new ways," says Nikitaidis.

She also predicts a resurgence in the power of LinkedIn, the favored platform for business networking. After pitching an op-ed to The Cut and Huffington Post Women, her consulting client posted her piece to LinkedIn and amassed one million views in a two weeks span.

"There's such a huge opportunity and LinkedIn, especially for small business owners, where you're looking at who you know, and who wants to help, and you want to get out in front of your network first," says Nikitaidis.

Similarly, Humphries predicts the future of integrated marketing lies in storytelling.

"I think that brands will continue focusing on telling their own story and communicating with their audience directly through all of the channels that are relevant to them," she explained.

Regardless of what the future holds, communications can't be ignored in the present. " It's not a nice-to-have anymore — it's a must-have," explains Nikitaidis.

"Getting smart about PR, marketing, influencer marketing, influencer partnerships is one of the best business tools," says Nikitaidis. "It's just truly one of the best things you can do to grow your business as a small business owner."

The PR Starter Kit

Ashley Small, founder and CEO of Medley Inc., joins the Houston Innovators Podcast this week to discuss COVID-19's affect on her business and fostering diversity at startups. Photo courtesy of Medley Inc.

Houston founder calls for business leaders to 'make room for diverse voices'

HOUSTON INNOVATORS PODCAST EPISODE 70

Last year was one of quick pivots and tech solutions for Ashley Small and her company's clients. Small — the CEO and founder of Medley Inc., a Houston-based branding and public relations firm — works with both for-profit and nonprofit entities to tell their stories, and of course 2020 had its challenges in doing so. But they weren't anything Small, her team, and technology couldn't overcome.

Small founded Medley over 12 years ago, and for the past three of those years, her team has been completely virtual. She shares on the Houston Innovators podcast that this give her team a headstart on being able to find and quickly adopt quick tech solutions — but last year's shutdown also meant navigating this for all her clients.

"The biggest obstacle we had to overcome was figuring out what the best technology was for each client," Small says. "Where the learning curve has been is understanding all the available resources out there and understanding how offline experiences can help audiences connect online."

Founded in Houston, Medley has grown to the Los Angeles and Chicago markets over the years — and Small says that was intentional. An Oklahoma native, Small fell in love with Houston's diversity when she attended Texas Southern University, and sought out other diverse markets to expand her business. And, as a Black female founder, she fosters an inclusive community at her company — and wants to remind her fellow business owners how imperative it is to running an innovative company.

"Innovation is actually impossible without diversity," Small says, adding that when you bring different people to the table, you get new ways of thinking. "A part of this is also being really open minded to the fact that you are going to hear ideas that sound and look different. Be open to that, because that is 100 percent the point."

Small knows early-stage companies aren't always able to hire a bunch of people from diverse backgrounds right from the start, but there are other ways to surround yourself with diverse ideas.

"Make room for diverse voices -- and you may have to be a bit creative," Small says.

Medley's team also realizes that not every startup can afford to bring on an in-house or third-party PR team, but the company has a few options for startups, such as a three-month retainer to start as well as a series of workshops available online for as low as $19.

Small discusses more about how she's honoring Black History Month with her team and the evolution the PR and media industries have seen over the past decade on the episode. Listen to the full interview below — or wherever you stream your podcasts — and subscribe for weekly episodes.

What does your company plan on bringing into the new year — and how do you plan to communicate your efforts? Photo courtesy of All You Need Method

5 PR and marketing tips for Houston startups and small businesses in 2021

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The past year has been a rollercoaster for small businesses. When the pandemic hit, every single person was affected. We've all had to pivot in some way either personally, professionally, or both.

As public relations and marketing professionals who specialize in working with small businesses, we've spent the last 10 months in the trenches with our clients, advising and helping business owners and entrepreneurs navigate these uncertain times. While small business revenue is down since January 2020, it's not all doom and gloom out there – we've seen many other businesses experience unexpected success and growth, and according to economists, we are entering the greatest entrepreneurial economy of our time.

And as we start this new year, there is no better time to invest in business growth and planning. Below are five tips to help you get started.

1. Get smart on your PR

Whether you know a little or a lot about public relations, marketing, and social media, take some time to get caught up on the current landscape. It is constantly changing, and having a better understanding of how traditional media, social media, paid marketing, owned content and all other components can benefit your business will inform decisions about where to allocate your time and resources.

First, assess what stage of business you are in as well as your business goals to determine what PR and marketing tools could be most beneficial to your growth at this time. Not all small businesses are prepared, financially or otherwise, to invest in PR, and there are fundamental steps you can do on your own to get your business positioned to succeed.

With online education booming, there are many free resources and tools at your disposal. We created All You Need Method to simplify PR and marketing for small business owners. You can download our Free PR Roadmap on our website to assess what level of PR support is right for your business. We also created The PR Starter Kit online course to give small business owners the fundamental tools they need to use PR, marketing, and social media to support business growth and build a lasting brand – and it only takes a few hours to complete.

2. Revisit your target audience

The world has changed significantly over the past year and so have the wants, needs, habits, and interests of consumers. As a small business, it's imperative to understand your target audience's current problems in order to relate to them, build trust, and deliver a product or service that is meeting their needs.

Before investing time and financial resources creating and executing a 2021 business plan, take a step back and consider your ideal customer. Outline how the past year has created opportunities or challenges in their life, problems they are facing, new shopping habits, lifestyle shifts, communication preferences, concerns, etc. If you have more than one ideal customer, work through this exercise for each.

With this new perspective, you will be equipped to make business decisions through the lens of how you can better serve your customers, rather than how to increase revenue.

3. Stand for something

Brands that are succeeding today are the brands that are authentic, vulnerable, and that stand for something. According to a global study by Zeno Group in July 2020, consumers are 4 to 6 times more likely to purchase and champion purpose-driven companies.

Having a purpose doesn't require a brand to have a philanthropy component or an outspoken political stance – it's about identifying your specific values and making them apparent through your messaging and leadership within your industry. Values could include committing to sustainable production methods, outstanding customer service, commitment to diversity, or supporting a specific cause. What is most important is that your values are authentic and that you can stand behind them long-term.

As the founder/owner of a small business, you have an opportunity to put a face and values behind the brand so that your company is about more than selling something.

4. Clarify your message

After revisiting your target audience and carefully considering your brand values, incorporate those findings into your messaging. Conduct an audit of your website, social media channels, and all external facing materials, and update your messaging to ensure that if your ideal customer had a 30 second encounter with your brand, they would walk away with your most important messaging points. Important points to consider as you craft new messaging include:

How your product or service solves a problem for or benefits your target audience
Brand values
Points of differentiation

5. Be authentic and communicative

Before the days of social media, a brand had to rely on third parties, including editorials and ads in magazines and newspapers, to spread the word about their brand. Social media and all "owned channels," including a brand's website, blog, and newsletter, have leveled the playing field and allow small business owners to have control over their communication with customers. Through your owned channels, a brand can decide what to post and when, which is incredibly valuable.

While securing press and advertising opportunities is valuable to growth and brand awareness, it's largely outside of one's control. Focus your time and financial resources on communicating with your audience by creating content for your owned channels. Creating content and posting consistently can seem overwhelming to a solopreneur or small team, but there are ways to make it manageable:

Pick only a few owned channels to focus on, prioritizing platforms you are most familiar with using and where your audience is most active
Quality and consistency are more important than quantity. If you're only posting once a week due to bandwidth, commit to that frequency and increase frequency as you are able
To inspire and inform content creation, think about how you can serve your customers through your areas of expertise and what is relevant to both your brand and audience (events, holidays, partnerships, new product launches, etc.)
Create a content calendar so that you can plan out posts a month in advance to avoid last minute scrambling to decide what to post

Once you've worked through these five tips, make a plan to support your business goals - and start thinking in two phases.

Phase 1: Pandemic Home Stretch - Although there is hope with a COVID-19 vaccine, we know we will likely be dealing with the effects indefinitely. Use this time of uncertainty to get your business in the best shape possible.

Phase 2: Post Pandemic - How do you want your business or brand to show up when the world opens back up? It feels far off, but it is closer than you think and there is a huge opportunity for those who are willing to put in the work now.

Remember, these challenging times will pass. There is massive opportunity for the businesses and brands who are willing to reflect, pivot, and plan for a brighter future.

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Kathryn Worsham Humphries and Carla M. Nikitaidis are the co-creators of Houston-based All You Need Method, a PR and marketing resource for small business owners and entrepreneurs.

It's important to craft an informative and considerate message when sharing news of a COVID-19 exposure. Getty Images

4 COVID-19 messaging tips from Houston communications expert

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Houston is undoubtedly hitting critical mass with COVID-19. The common sentiment has transitioned from "knowing someone who knows someone that has COVID-19" to more frequent first-hand, anecdotal experiences. When a potential exposure happens in the workplace it's vital that employees and companies alike quickly, professionally, and responsibly inform any parties that could have been indirectly exposed including vendors, clients, or meeting participants of any kind.

We understand as communication experts, informing a client, boss, or anyone that you've potentially exposed them is scary messaging to share. Guilt is the number one emotion people report experiencing when they realize they've potentially exposed someone or a group of people, even though the respective exposure was inadvertent. Nevertheless it's crucial to communicate the exposure quickly and effectively as that's how Houston can hinder the spread of this disease through our city.

So, how have we been counseling our clients as these potential exposures arise? Here are some notes and even an email template that Houstonians can use to help get them started.

Respond quickly

This is not a time to wait for certainty. Do not wait for tangible test results or any type of certitude (such as you experiencing symptoms first-hand) before notifying a person or company that you've potentially exposed them. Remember: you aren't telling someone you gave them COVID-19, you are simply telling them that you have been exposed and therefore inadvertently exposed them.

Be honest and forthcoming with information

This is not a time to offload or dwell on your feelings of guilt, albeit that's a natural emotion. A simple apology for the situation you collectively find yourself is appropriate but a deep into your own feelings and context for the situation is neither necessary nor helpful. Remember, during times of crisis, people don't remember what you said, but that you said something at all when it would have been easier not to and that you're someone of high morals and character.

Be detailed, but not too detailed

Again, you want to share concrete information versus your own personal emotions and feelings surrounding the incident. Pertinent information includes the following;

When and where you were exposed
When and where you exposed others
If you're currently experiencing any COVID-19 symptoms
Pertinent test results (if any) in regards to how you were exposed

Work from a template

Salutation:

It has come to my attention on date that I was exposed to COVID-19 through home, work, office, etc.

Because of this, it's a possibility that I unknowingly exposed you at date and place of interaction.

Though I am not currently not experiencing any symptoms and feel healthy, I wanted to let you know about this and err on the side of caution.*OR*I currently am experiencing symptoms of Covid-19 including X,Y, Z. I plan to get tested and can let you know the results when I receive them.

I apologize for this situation and am here to answer any further questions that might help you determine how to proceed accordingly.

Sincerely,
Name

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Megan Silianoff is the founder and creative director of Mad Meg Creative Services, a Houston-based firm specializing in public relations, social media management, web design, and branding.

Why use social media for business? These two PR experts make their case. Getty Images

Houston PR team shares how social media can affect your small business

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As a small business owner, I know firsthand how important it is to stay on top of the latest marketing trends. We no longer live in a world where traditional public relations alone will achieve your business objectives. With new and evolving digital platforms creating so many ways to communicate with your target audience, businesses must diversify their public relations and media strategies to be successful.

We cannot work in silos; instead, we need to have a comprehensive approach, including tactics such as media relations, community partnerships, unique events, influencer collaborations, digital and traditional advertising, email marketing and social media.

While some of these marketing channels can be costly, social media for small business owners is an absolute must and an inexpensive way of keeping your brand top of mind.

How businesses use social media for marketing can vary depending on the industry. The first step is determining which social media platforms make the most sense for your business. Where are your competitors? Are they on Facebook, Instagram, Twitter and LinkedIn? If so, does it also make sense for you to have a presence on each of these, as well?

Once you know where you should be, decide who you want to reach and what your message should look like in order to accomplish this. Messaging can certainly vary on each platform, as can your target audience.

Recruiting, B2B content and company updates are best suited for LinkedIn, while beautiful visuals and brand stories are reserved for Instagram and Facebook. Twitter can serve as a great platform for timely updates and conversations with followers. To create effective social media marketing for small businesses, solidify your brand voice and target audience before creating content.

As you begin creating organic content to push out to your target audience, take advantage of the advertising tools within each platform. Facebook's Ad Manager provides businesses with an intuitive approach to advertising on Facebook, Instagram, and Facebook's Audience Network. By adding marketing dollars to your social media strategy, small businesses cast a wider net with individual posts and reach a larger audience by creating campaigns with specific objectives such as driving website visitors. With advertising spend on social media, you will be equipped with even more data and analytics than your organic posts generate in order to understand who is engaging with your content.

It's always beneficial to keep these options in mind, while understanding the value social media brings to your overall marketing strategy. Social media is a great tool for upper funnel objectives, such as raising brand awareness and interest, rather than lower funnel, conversion objectives. You want to rely on social media to increase your customer base, connect with current customers and influence them down the purchasing path.

The beauty and power of social media for small business owners is that it's affordable and efficient. It can serve as a snapshot of your brand when potential customers visit your page.

There's no better way to build relationships with your current and prospective customers than through social media marketing. It offers a quick turnaround time, granular targeting options and real-time consumer feedback and communication.

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Karen Henry is the founding partner of The PR Boutique, a Houston-based public relations firm. Kirby Levey is the company's senior accounts and digital executive.

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Houston brain health co. secures $6.5M for rare disease study

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Houston-based Goldenrod Therapeutics, part of Fannin Partners' portfolio, has announced the initial close of a $6.5 million series seed preferred stock round.

The round was led by Ataxia Ventures and an affiliate of Fannin, according to a news release.

Goldenrod Therapeutics plans to use the funding to support manufacturing, formulation optimization, IND-enabling studies and a Phase I study of its drug to treat brain inflammation, known as 11h.

The study will consider how 11h, which blocks the enzyme PDE4, could treat Friedreich’s ataxia (FA), a rare genetic disease that affects movement, speech and balance. To date, other PDE4 inhibitors have proven to regulate neuroinflammation and neuronal signaling, but have had adverse gastrointestinal side effects or have not reached enough of the central nervous system, according to Goldenrod.

The company says its 11h is expected to have "broad applicability" with limited emetric side effects.

“Our 11h program is a next-generation, orally bioavailable, brain-penetrant PDE4 inhibitor, where researchers overcame longstanding limitations associated with earlier PDE4 inhibitors," Dr. Dev Chatterjee, CEO of Goldenrod, said in the news release. "We believe this creates the potential for a best-in-class therapy for Friedreich’s Ataxia and a potential foundation for development across multiple neurodegenerative and neuroinflammatory disorders.”

11h was first developed at the University of Nebraska Medical Center (UNeMed). Houston-based Fannin Partners in-licensed the product 2020 and landed SBIR Phase I funding to support its initial development for opioid use disorder soon after.

Goldenrod has also received funding to study 11h's effectiveness for multiple sclerosis, methamphetamine addiction and cocaine addiction.

Goldenrod says it is developing 11h to target a variety of neurological and inflammatory conditions, including Alzheimer's disease, multiple sclerosis, ALS, substance use disorders, Batten disease, pain and traumatic brain injury.

Elon Musk's SpaceX is about to make its debut on Wall Street

Money Moves

Elon Musk's rocket company SpaceX will make its debut on Wall Street Friday, June 12, and both institutional and retail investors are expected to gobble up the 555.6 million shares going up for sale at $135 apiece. Musk, already the world's richest man, could become its first trillionaire.

SpaceX is likely to become the biggest IPO ever, with proceeds of around $75 billion. SpaceX hopes to become the first company to send people to Mars. In fact, part of Musk’s future compensation depends on SpaceX eventually establishing a colony of at least 1 million people on the red planet.

Why SpaceX is going public now

In a video conference on Musk's social media platform X, he told JPMorgan CEO Jamie Dimon that people have suggested for the last 10 years that he take SpaceX public. He's doing it now because the company plans to put 100,000 next-generation Starlink satellites into orbit. Deploying AI data centers in space is a “massive new growth base and you need capital for that,” he said.

Going public provides access to the capital that SpaceX needs. But it also exposes it to more scrutiny from shareholders and more regulatory oversight. That includes filing quarterly financial reports, which critics say incentivizes short-term thinking over longer-term planning and creates unnecessary costs for a company. Securities regulators are currently soliciting public comment on a proposal to require public companies to file the financial reports only twice every year.

How the IPO impacts the company

Musk will hold the majority of a special class of shares, giving him control over decisions related to company strategy, finances and personnel. On the latter, because of his ownership of most of these Class B shares, the only person who can fire Musk as CEO is Musk.

The company credits Musk with being the “driving force” behind its growth, innovation and success. But what happens if Musk is no longer in the picture? SpaceX warns that the loss of Musk could disrupt its ability to execute its strategy as well as hurt its “reputation and relationships with customers, partners and other stakeholders.”

The company also warns that finding a replacement with the same skills and experience as Musk would be time-consuming, if not nearly impossible. As Wedbush Securities analyst Dan Ives wrote Wednesday, “At the end of the day Musk is SpaceX and SpaceX is Musk.”

What could make or break SpaceX

Currently in the test phase, the gigantic reusable Starship rocket is key to SpaceX realizing Musk's ambitions. Much of the commercial space business hinges on SpaceX developing Starship’s capability to be fully reusable and hearty enough for a quick turnaround between flights. If that doesn't happen, SpaceX warns that putting data centers and satellites in space will take longer and cost more money, meaning it risks customers bailing on the company.

Analysts say that by pioneering reusable rockets, SpaceX has established a clear lead on competitors such as Blue Origin, led by Amazon founder Jeff Bezos. The Starlink satellite business competes with, among others, AST SpaceMobile – which is relying on a SpaceX rocket to send its latest generation of satellites into orbit next week.

The prospectus filed last week says SpaceX’s biggest potential market is the sale of business-oriented artificial intelligence products designed to transform how people get work done. It’s an opportunity SpaceX predicts would be worth $22.7 trillion if it could somehow dominate rivals like Anthropic, OpenAI and Microsoft in a highly competitive industry. But the prospectus shows no clear path to profitability for the xAI business, which merged with SpaceX earlier this year.

Why Wall Street is paying attention

If the SpaceX IPO is as successful, the stock could quickly join the Nasdaq 100, a widely followed index that tracks the 100 largest non-financial companies in the composite. That's important because some popular funds, such as the $460 billion QQQ exchange-traded fund, mimic the index and will automatically buy whatever is listed in the index.

Nasdaq recently changed its rules to allow select companies to enter the Nasdaq 100 after just 15 trading days.

S&P Dow Jones Indices, on the other hand, is sticking to established and more traditional thresholds that will not allow SpaceX or other companies with gargantuan IPOs faster entry into its S&P 500 index. That means even high-profile companies will still need to wait for their stocks to trade a full 12 months before they can enter the index.

Companies want to be in the S&P 500 in particular because it's arguably the most important index on Wall Street, with trillions of dollars either mimicking it exactly or benchmarked against it. Vanguard's VOO fund that tracks the S&P 500 has roughly $950 billion invested in it, for example.

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Why a thought leadership strategy matters

How to implement a thought leadership strategy

all you need

HOUSTON INNOVATORS PODCAST EPISODE 70

guest column

1. Get smart on your PR

2. Revisit your target audience

3. Stand for something

4. Clarify your message

5. Be authentic and communicative

guest column

Respond quickly

Be honest and forthcoming with information

Be detailed, but not too detailed

Work from a template

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CultureMap Emails are Awesome

neuro funding

Houston HQs

Money Moves

Why SpaceX is going public now

How the IPO impacts the company

What could make or break SpaceX

Why Wall Street is paying attention