California's lost at least $3-4 billion in tax revenue so far from Elon's and SpaceX' move to Texas. But this is a loss that will compound over time. SpaceX is part of the massive Musk ecosystem, which includes vendors, suppliers and contractors, and the total economic activity is enormous and growing. Having driven out the most dynamic companies on earth, California is now aiming at the AI industry and its VC ecosystem.
Most of the $3-4 billion lost is a loss of Musk's personal income tax. The largest piece is capital gains on his 2021–2022 Tesla sales (~$20–25 billion in gains that followed his residence to Texas, worth ~$2.7–3.4B at California's 13.3% rate). Notably, his move did not save him most of the tax on the famous $23 billion option exercise — California sources option income by workdays over the grant-to-exercise period, so ~85–90% of that spread was California-taxable anyway. And the corporate franchise tax loss is approximately zero: under single-sales-factor apportionment, headquarters location is irrelevant — California taxes sales to California customers wherever the company sits, and the company is running operating losses besides.
The IPO was a primary issuance (proceeds go to the company), Musk is locked up for a year, and employees face customary lockups, so the IPO itself realized almost no taxable gains for anyone. The real future leakage is Texas-resident employees and early holders selling low-basis stock post-lockup — plausibly $0.5–1.5 billion in California tax that will never materialize. cost California real money, but it's measured in single-digit billions, concentrated in one taxpayer's 2021–2022 transactions.
Elon just created 4,400 millionaires in a single day.
400 of them are now worth over $100 million.
These aren't VCs. They're SpaceX employees, and the list includes welders, technicians, and cafeteria staff, because for two decades the company paid every level of the workforce in stock instead of higher salaries.
Juan Hernandez immigrated from Mexico and took a $28 an hour contractor welding job in 2015. He says he didn't even know what SpaceX was. The company gave him a $10,000 equity grant and let him buy more shares through payroll deductions. That stake is now worth $880,000.
Trevor Hise's parents wanted him to take a stable job at General Electric. He picked SpaceX instead, stayed 12 years, and accumulated over 100,000 shares. At the $135 listing price that's $13.5 million. He's 37 and semiretired. His words: "The magnitude of this has been ridiculous."
The most telling detail came before the listing. Over 100 employees quietly banded together and negotiated a group wealth management deal covering up to $5 billion, because none of them had ever needed a wealth manager before.
Software IPOs have minted millionaires for 30 years. This is the first one where the money went to the factory floor.