Cathie Wood’s hedge fund Ark Invest has increased its stake in Elon Musk’s space exploration venture SpaceX by another $7 million.
This has brought Ark’s stake in SpaceX to 17.55% via the Ark Venture Fund ETF (NASDAQ: ARKVX), compared to roughly 12.7% stake three months ago.
Ark has ramped up its pitch for the ETF that gives retail investors a way to buy stocks of privately-held companies.
It has specially assumed significance following the artificial intelligence boom.
Most AI product companies are privately-held, leaving retail investors to mostly look for indirect ways to bet on the rapidly emerging technology.
ARKVX’s portfolio, for example, comprises of AI startups like Claude maker Anthropic Inc (4.2% of the portfolio), ChatGPT parent OpenAI (3.1%), Tempus AI (1.6%) and another of Musk’s companies — xAI, which comprises 1.5% of the ETF’s portfolio.
Wood has been especially bullish on Musk as an entrepreneur, having been one of the most adamant Tesla Inc. (NASDAQ: TSLA) bulls over the years.
The electric vehicle maker Tesla is the biggest holding in Wood’s flagship fund, the Ark Innovation ETF (ARCA: ARKK).
The fund has lately noted Musk’s proximity to the recently-elected U.S. President Donald Trump as a positive event for his companies.
On SpaceX, Ark is especially keen on the opportunity presented by its satellite internet service Starlink.
According to Wood’s first, there is a $100 billion opportunity in the satellite internet space in the medium-term, and Musk’s company is on track to grab an overwhelming majority of it.
Starlink has been rolled out worldwide, but with the world’s two most-populous countries China and India bringing hiccups.
China with its censorship needs is unlikely to reconsider a ban on Starlink, but Musk has been in talks with the government of India to find an entry into the country.
The world’s richest person is expected to have discussed regulatory hurdles surrounding bringing Starlink to India in a meeting with Prime Minister Narendra Modi on Friday.
Besides, Ark also sees a $270 billion opportunity in point-to-point transportation to space, and it could be up for grabs for SpaceX if its Starship is able to achieve rapid reusability as intended.
Musk’s company competes with Jeff Bezos’ Blue Origin and Richard Branson’s Virgin Galactic in this market.