Milestones matter, especially in the finance industry. The world’s first $1tn public company (Apple in 2018) reset expectations for corporations. Microsoft, Saudi Aramco, Nvidia and a handful of others, with shares anyone can buy on a stock exchange, have since crossed the same threshold. Now, the question is: when will a private company – one that hasn’t gone public via an IPO – reach the same staggering valuation and join the exclusive 12-zero club?

Today’s most valuable private companies are growing fast, yet are often in no rush to sell shares to the public. Valuation-wise, the divide between public and private markets is shrinking, especially in the tech sector. Still, structural challenges will make it challenging for private firms to join the trillion-dollar club.

Where are we now?

In August, OpenAI, the creator of ChatGPT, was reportedly looking to allow employees to sell stock to investors at a valuation of about $500bn. TikTok-owner ByteDance is reportedly launching a buyback scheme that would mean a valuation of above $330bn. In July, rocket-maker SpaceX planned an insider sale that would lead to a valuation of $400bn.

While those figures are eye-wateringly large, they’re still a little way from $1tn. To make the jump from billions to trillions, a private firm would need some combination of:

– A huge addressable market– High margins, with unit economics that scale with limited cost drag– Network effects or a technological moat to protect market share– Investors who are willing to front funding without forcing a sale or IPO

That narrows the field significantly. Only sectors with global, systemically important markets – including AI, finance, and energy – realistically have the headroom for trillion-dollar valuations.

What’s driving the momentum toward the trillion-dollar mark?

The changing landscape means we could see a private company with a thirteen-figure valuation in the not-too-far-off future.

It’s easier than ever to stay private. Private capital markets have exploded in the last two decades. Globally, private markets were worth about $22tn in 2024, according to McKinsey. Mega-funds like SoftBank’s Vision Fund and sovereign wealth funds are pouring tens of billions into single deals.

That means companies can now attract the kind of capital once available only via IPOs. Stripe, for instance, raised over $6.5bn privately in 2023 at a $50bn valuation. SpaceX has raised more than $11bn across rounds. With access to this sort of financial firepower, a company can comfortably stay private for far longer than before.

Disruption is becoming… more disruptive. Some of the biggest potential for value creation today comes from industries with huge upside potential: artificial intelligence, clean energy, space and biotech, for example.

Private investors can afford to be patient. Public investors often demand liquidity, but sovereign wealth funds like Singapore’s GIC or Saudi Arabia’s Public Investment Fund can hold onto private stakes for decades. This opens the door for valuations to compound quietly, away from the volatility of public markets.

What’s still holding us back?

Liquidity pressure. The bigger the company, the higher the expectations of early investors, employees and founders. Private investors have long time horizons, yes, but they’re not infinite: venture capital funds often need to return capital within 10 years, and employees will want liquidity for their shares at some point.

Valuation discipline. Public markets impose discipline: firms are pressured to turn potential into cold, hard cash – and they’re assessed by the quarter. Private valuations can rise on momentum, but a $1tn figure demands sustained revenue, margins and market share. Even deep-pocketed investors may be cautious without hard proof or public market comparisons.

Political and regulatory risk. The closer a company gets to “systemically important” size, the more attention it draws. ByteDance, for instance, has faced scrutiny around the world. A trillion-dollar private company would be a geopolitical actor as much as a business, and regulators may demand transparency that only public markets can provide.

Who are the likely contenders?

• OpenAI: The ChatGPT creator’s products could underpin everything from business productivity to entertainment. While the company’s valuation reportedly nears $500bn, even CEO Sam Altman has warned of a bubble in AI. Even smaller rival Anthropic recently raised fresh financing at a $183bn valuation, however.
• SpaceX: Valued at around $400bn, with a near-monopoly in commercial space launches and a fast-growing Starlink satellite business. Its total addressable market could stretch to the trillions if it captures global internet coverage and space infrastructure.
• ByteDance: TikTok’s parent company is targeting a $330bn valuation, but political risk is its Achilles’ heel. While the US Congress passed a ban on TikTok in January, it has been repeatedly delayed.
• Shein or Temu-style commerce platforms are proving they can move tens of billions of dollars in merchandise, but they may be held back by thin margins. Their cross-border shipments have also been hit by U.S. tariffs.
• A climate tech company could also have a shot, especially if one helps transform clean energy production.