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"Flying cars" used to be an example of technology so far off, you wouldn't see it in your lifetime.
A Munich-based company called Lilium is changing that. It's making "The Jetsons" real.
Lilium is an aviation startup founded in 2015, and it's exciting the investing world.
The company's first manufacturing facility, opened in 2019, got $375 million in funding. And now, its vehicles are headed for the United States. Now it's breaking ground on an actual airport in Orlando, Fla.
This is a revolution in transportation. And opportunities to get in on the ground floor are slim as of yet.
Retail investors are itching for a chance to get in on Lilium stock. That might take a while. No Lilium IPO date has been set yet. But you want to keep this on your radar for when it goes public.
Imagine owning a piece of all the train stations along the first Transcontinental Railroad. That's what it would be to own Lilium stock today.
If the company goes public well before building hubs in major cities across the United States, it would be a tremendous growth opportunity for early investors.
How Lilium Is Breaking Ground
Lilium's eVTOL is a miniature plane that seats four passengers and acts as a sort of "air taxi" to help people avoid interstate highways.
This is intended to eventually be a transportation network connecting several major cities.
For example, it takes about 1.5 hours to get from Lake Nona to Tampa by car. One of Lilium's flying taxis can do the same trip in 30 minutes.
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Lake Nona is where the company is building out its mini airport, the "Lake Nona Vertiport." It's a $25 million project being built in partnership with Tavistock Development Company and the Orlando city government.
The vertiport is set for completion in 2025, but it also has yet to be approved by the Federal Aviation, Florida Department of Transportation, and other regulators.
For its part, the city has granted Lilium an $800,000 tax break over the next nine years. It follows a sustainability trend that can be seen across the world with EVs and other clean energy sources.
The building project also creates hundreds of jobs for the city of Orlando. According to the New York Times, those jobs will pay an average of $65,000 per year.
Lilium's planes are fully electric. You can't hear them from the ground.
The greatest benefit to the surrounding area, of course, will be a de-clogging of highways.
That is still far, far in the offing, though. Until regional travel goes mainstream, the cost of an air taxi will cost about as much as a domestic plane ticket.
Should I Buy Lilium Stock After the IPO?
Renewable energy stocks "surged more than 80% in 2020" according to The Wall Street Journal.
Among those were electric vehicle stocks like Tesla Inc. (NASDAQ: TSLA), which proved it could profit for six straight quarters. The company's stock surged nearly 400% since the start of the year.
Several other EV stocks had hallmark years as Workhorse Group Inc. (NASDAQ: WKHS) started working a deal with the U.S. Postal Service and Nikola Corp. (NASDAQ: NKLA) went public through a special purpose acquisition company (SPAC).
The highest gains from those stocks were around 900% and 600%, respectively.
If Lilium were a publicly traded company, it would have been one of those. The Telegraph referred to Lilium as the "Tesla of the sky."
The big difference, however, is that this is so much bigger than electric vehicles.
Lilium is paradigm shifting. It is not only electric and autonomous like Tesla; it floats in the sky.
Initially, this would have raised questions about whether a company like this could spark demand for alternative infrastructure. But the local government partnerships in Orlando show that it's viable.
Even better news is that Orlando is not the only place Lilium's "Regional Air Mobility" is being tried.
The company is also working with airports in Dusseldorf and Cologne. The timeline for these is about the same as the Orlando-Tampa "regional air mobility" system.
As far as Lilium's finances are concerned, it's raked in the dough with a $275 million funding round in 2020.
The company has also hired a new chief financial officer (CFO), Geoffrey Richardson, formerly at the autonomous car company Cruise. As CFO of Cruise, Richardson brought in $7 billion in capital from investors. His expertise in the autonomous vehicle industry should also benefit the company.
It will be an exciting moment when the Lilium IPO arrives.
Of course, IPO investing is not always so simple. There are great opportunities like Alibaba Group Holding Ltd. (NYSE: BABA), which would have more than doubled early-stage investments.
There are also duds like the Lyft IPO, which lost some investors around 70% of their money.
The way to look at a potential IPO is always make sure you're looking at the facts and the hype side by side.
You're going to be seeing plenty of hype around Lilium's regional air travel systems over the next few years. But it's important to carefully watch for any financial or operational facts to validate it.
Here are the facts so far.
Lilium has been steadily raising money to a valuation of $1 billion so far in its five-year lifetime. That is excellent.
It just hired a new, wise CFO to maintain course.
It is partnering with cities on multiple continents to implement its systems.
The technology is also the coolest thing anyone alive has ever seen.
So, there is plenty of reason to be excited about investing in Lilium stock when the time comes.
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