Can anyone say anything good about companies using SPAC as a method of going public? All I hear is that it's a way for executives and VCs to exit faster without regulations and outcomes are generally bad.
I'm no expert, but two of the key advantages noted for SPACs has been:
* Lower fees
* Less regulatory filings
It seems that one reason big investment banks (e.g. Goldman Sachs) are exiting the SPAC market is due to increased regulatory pressure, which may erase that advantage [1]
I agree that your number 2 is an advantage for the SPAC and the company using it. Being quite a fan of, reasonable, regulation I see it as a potential red flag. Ultimately, the numbers have to be public. When they are, it is too late for early investors to do proper due diligence so.
I think a more interesting question is whether anyone can point to a company that used a SPAC that has been a clear success. Maybe not on the scale of Meta/Facebook, but even moderately successful.
That is an honest question - I can’t think of any but I’m also no expert.
In a traditional IPO, you go to the banks and they arrange a road show for you to talk to investors. Then everyone negotiates how much stock they want at what price. The company doesn't find out how much it will sell or its valuation until the night before the IPO! And if it fails, it is massively embarrassing and damaging to the company
With a SPAC, all the negotiations take place privately, and when they're done, the company knows exactly what they're selling and at what price.
I generally think Rocket Lab will be a successful SPAC story (eventually). They are so far ahead of the remaining small sat launch market that they while rise to meet SpaceX and Blue Origin in the reusable launcher market.
easy: only 10% of the SPAC target companies merged in 2020 and 2021 are writing this warning. this is double that of IPOs. thats it. thats the whole article. It means 210 companies are not writing that warning.
everyone is just posting copypasta they already had made about SPACs because they got burned on the share price direction, which for decently managed companies the share price has nothing to do with health or treasury balance. this article is bait for this sentiment.
