SPACs 101: A Bubble, the Future or Both?

<p><span style="font-weight: 400;">Special purpose acquisition companies have been around since the 1990s, but have seen a significant uptick in popularity in recent years. Companies like Virgin Galactic, Draft Kings and Nikola have changed SPAC’s reputation from a tool for second- and third-tier private equity shops to win fees to a legitimate alternative to initial public offerings. In 2020, SPACs have made up roughly 40% of the IPO market.</span></p> <p><span style="font-weight: 400;">Recently, chatter around SPACs reached a fever pitch with the listing of Bill Ackman’s Pershing Square Tontine Holdings - the largest-ever SPAC. </span></p> <p><span style="font-weight: 400;">In this episode, NLW breaks down:</span></p> <ul> <li style="font-weight: 400;"><span style="font-weight: 400;">What a SPAC is</span></li> <li style="font-weight: 400;"><span style= "font-weight: 400;">Standard SPAC terms </span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">Why the traditional IPO process has generated growing discontent, especially from Silicon Valley</span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">The benefits of SPACs for companies and investors</span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">The downsides of SPACs for companies and investors </span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">A number of reasons explaining why SPAC popularity is surging now</span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">How Robinhood retail traders are creating an important bridge buyer for SPACs</span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">Why Ackman’s Tontine Holdings SPAC could change how we think about SPACs in the future </span></li> <li style="font-weight: 400;"><span style="font-weight: 400;">Are SPACs a bubble?</span></li> </ul> <p><span style="font-weight: 400;">Cited resources:</span></p> <p><a href= "https://danco.substack.com/p/spac-man-begins"><span style= "font-weight: 400;