What is the most successful, *non-Tech* company founded in America since 1980?

Be that as it may, this sub-discussion was about whether the SpaceX valuation of $74bn that had been posted upthread was just as good as any arbitrary figure anyone can make up. Given that the figure is the result of an auction among fallible but still sophisticated venture capital investors who had to put their money where their mouth was, I don’t think this is true.

Given that SpaceX did somewhere south of US$3B gross revenue in launches in 2020 (and even granting the US$2.9B lunar lander contract under the assumption it will actually happen), it is really difficult to see where that valuation has real basis even when you factor in highly optimistic projections for Starlink.


I dunno, I’ve been investing decently large amounts for a private investor (i.e. a non-super rich person) for many years, and I no longer really know what the smart money does. I know that I avoid fads like Tesla because I’m a risk averse value investor that follows a strategy that has worked well for me in my life. It hasn’t turned me from a Pauper into a Prince, but it’s definitely accelerated my lifestyle, it’s how I own a decently successful real estate business that I built up while I completed a multi-decade career as a (not amazingly well paid) officer in the U.S. Army.

The traditional investing ethos is that over long enough the market is a weighing machine, and the passions of the mob will be reconciled to reality. But we have seen for nearly 20 years now persistent and extreme deviations in price from underlying value of companies, with no serious corrections occurring in many cases. I frequently wonder if the great “democratization” of investing and the huge portion of investment done through automatic index funds, has created this pressure wave that keeps prices far above fundamentals…if not forever, for “generational” periods of time. Amazon is one of the best-case studies of this, because even with its amazing revenue growth over the last 20 years, at no points has its PE ratio ever made “sense”, because as much as Amazon’s revenue has grown so too has exuberance and willingness to pay an extreme premium to that revenue in share price by the market.

I’m certainly not saying you can invest in whatever fad you want and the market will keep propping it up, but I am saying there’s some evidence that fundamentally bad investments, have been, and are, paying off over long periods of time. I’m simply not educated enough in high finance or economics to pretend I know the reason, my pet theory is it’s because of the democratization of investing–when I started trading stocks it was $50 a trade and I had to call a broker. I typically traded in lots of minimum 100 shares which meant thousands and thousands of dollars–and this was back in the 1980s when that was real money. There’s a huge class of people that I’m personally familiar with who invest in Tesla almost as a virtue signal, and I have no doubt if SpaceX was a public company they would be doing the same with SpaceX.

IIRC that’s because most states forbid maker-owned retail outlets for cars, and mandate that the maker must sell through a local franchisee.

Yep, the “franchise laws” and such that make it illegal in most states for manufacturers to sell cars direct to customers is something I frequently point out to when I discuss with my conservative friends how American capitalism has actually almost always had structural elements to it that are very much not free market, in fact they are often times largess and carve outs for special interests. There are generally very few such things that I think are good policy, and the huge gift we give to the millionaires that own car dealerships with those laws is beyond belief in terms of insulating them from competition in a free market.

I feel this post sums up how I feel about all kinds of markets at the moment better than I can put into words. All kinds of inanities bid up to ludicrous prices wherever I look. And even when a particularly egregious fraud unravels the huckster behind it seems to walk free with their ill gotten gains more often than not.

But would that be any different if SpaceX were publicly listed?

Who can say? Given the public enthusiasm for all things Elon, it would likely be even more overvalued regardless of the enormous debt it would have to take on to capitalize the Starlink endeavor. What stockholders would think about the “Occupy Mars” nonsense, on the other hand, is probably not good, which of course is why SpaceX has not gone public.


Why highly optimistic? Starlink is meeting or exceeding promises for performance, is selling like hotcakes in beta, and has no real competitors for what it is offering. It has a global market full of under-served people.

Second-most valuable privately held company in the world.

I did a search on Bloomberg with these parameters:

IPO between now and Jan 1, 1980
Non-tech (according to Bloomberg classification)

Here are the top companies based on stock price performance:

  1. Home Depot +951,983%, IPO 1981
  2. ResMed +219,141%, IPO 1995
  3. St. Joe Company +219,141%, IPO 1990
  4. Fastenal +112,369%, IPO 1987
  5. SVB Financial Group +107,477%, IPO 1983
  6. Nike +88,615, IPO 1980
  7. AAON +86,342%, IPO 1988
  8. Walmart +70,697%, IPO 1982
  9. Natural Alternatives International +66,200%, IPO 1986
  10. IDEXX Laboratories +65,715%, IPO 1991

Bloomberg also returned Amazon and Cisco, but I don’t think they fit the spirit of the question.

Stock price is only one measure of success, but it’s at least an objective measure. This list also misses privately held companies.

The OP was asking about founded since 1980–IPO date isn’t founding date, most of the companies in that list went public after 1980 but were founded well before 1980.

Good point. Also, I see now see that the ResMed and St. Joe offerings were additional stock sales, not IPOs. Those should be removed and Expeditors International of Washington (+60,854%, 1984) and Amgen (+55,620%, 1983) should be included.

And actually started in 1980 so it’s right at that cusp (Expeditors International barely misses).

Except that Amgen is a technology business. The Wikipedia article says, “Focused on molecular biology and biochemistry, its goal is to provide a healthcare business based on recombinant DNA technology.”

I tend to agree with your overall thesis, but a reasonable thought experiment is this: you have a special time machine that lets you buy shares in Amazon in 2010. You can use any current information you want other than the stock price. What is a reasonable price to pay in 2010 for Amazon?

If your answer is anywhere north of $180, and it should be, given that the company is earning over $40 a share today, but your answer at the time would have been “$180 is an insanely high price to pay for this unprofitable company,” then you have to consider that Amazon’s 2010 investors understood something then that you didn’t. Or just got very lucky.

I don’t know if it’s as simple as that.

There’s a problem in which a system which came into place for historic reasons which made sense at the time then makes less and less sense due to changing conditions. The problem is that people who bought into the system and made big investments based on the then-current laws can be ruined by sudden changes in the laws which would fundamentally alter the market and render their investments worthless.

There’s a fairness argument to be made in favor of avoiding drastic changes in the status quo, and at any rate it can be expected that people who stand to be destroyed by the changes would thrown everything they have into lobbying against the changes.

So it sounds like you’re backing away from your original statement that “since it is not a publicly traded company anyone can estimate the ‘value’ to be any arbitrary figure”, and you now think that the market cap of publically traded companies is possibly even more worthless.

FWIW, the OP specifically listed “market cap” as one of the “obvious metrics” by which one might measure success. Sounds like you simply disagree with the OP as to that, even though it didn’t come up until SpaceX.

Market cap is a meaningless concept for stocks which aren’t publicly traded. Not too sure Stranger and I are in disagreement here.

Private valuations are less certain (and even the market makes mistakes, so it’s not certain either) and are more subject to individual manipulation and, frankly, wishful thinking.

The bigger question to me would be are we really classifying SpaceX as non-tech? That seems a little wild.

No I am not “backing away”, but thanks for playing. As a privately held company that has been quite closed about detailed development and operational costs, independent valuators can only speculate with little insight about future worth, often based upon little more than promotional materials and investor enthusiasm. Publicly traded companies are required to publish financial data that actually shows income, expenses, capital holdings, and liabilities, and so there is at least some basis to evaluate what the company has in terms of capital and revenue to fund growth, but market speculators often ignore the balance sheet in favor of the hope that inflated valuation will allow them to ride a wave and cash out before it crashed (e.g. “Greater Fool” theory), resulting in many of the ridiculously overvalued stocks we see today.

No, I’d agree with that statement. I’m not sure market capitalization is particularly meaningful, however, even for public companies whose values are not based upon the ability to achieve revenue or has adequate liquidizable capital to cover the market valuation or even invest in expanded production. FOMO, as @dtilque refers to, is not a salable quality that a company can use to cover production shortfalls or loss of public interest. We’ll see what happens when major car manufacturers other than General Motors start offering full lines of battery electric vehicles, but how Tesla could ever justify the absurdly inflated market valuation in terms of actual production is a “glorious mystery”.