It’s happening slowly but surely. With every passing week, more venture firms are beginning to announce SPACs. The veritable blitz of SPACs formed by investor Chamath Palihapitiya notwithstanding, we’ve now seen a SPAC (or plans for a SPAC) revealed by Ribbit Capital, Lux Capital, the travel-focused venture firm Thayer Ventures, Tusk Ventures’s founder Bradley Tusk, the SoftBank Vision Fund, and FirstMark Capital, among others. Indeed, while many firms say they’re still in the information-gathering phase of what could become a sweeping new trend, others are diving in headfirst.
To better understand what’s happening out there, we talked on Friday with Amish Jani, the cofounder of FirstMark Capital in New York and the president of a new $360 million tech-focused blank-check company organized by Jani and his partner, Rick Heitzmann. We wanted to know why a venture firm that has historically focused on early-stage, privately held companies would be interested in
If you own a company or work in the banking sector, you may be hearing the term “SPAC” 10 times a day now. It seems to be an increasingly common belief that SPACs are becoming the new go-to alternative to private equity fundraising. I traded SPACs in the late ’90s until 2010, and then when I ran a global equity business, we worked with them before the banks came into the craze. And today, I am one of many founders who is keeping a thumb on the pulse of how the SPAC space affects business outcomes.
In summary, a special purpose acquisition company (SPAC) is “formed to raise money through an initial public offering to buy another company. At the time of their IPOs, SPACs have no existing business operations or even stated targets for acquisition. Investors in SPACs can range