What Is a SPAC?

What do the British spaceflight company Virgin Galactic and the online sports betting operator DraftKings have in common? They both went public through one of Wall Street’s hottest trends: special purpose acquisition companies, more commonly referred to as SPACs.

Taking a company public through a traditional initial public offering (IPO) is a long, arduous process that can take a significant amount of time. SPACs, on the other hand, tend to have a shorter timeframe and fewer regulatory hoops, making them a popular choice for many companies seeking to go public. In fact, according to a recent Wall Street Journal article, nearly 70% of this year’s IPO activity occurred through a SPAC, contributing to the greatest surge in the number of companies listed on U.S. exchanges since the late-1990s dot-com bubble.

To help investors gain a deeper understanding of these ‘blank-check’ companies, Omnia Family Wealth Co-Founder and Chief Operating Officer Michael Wagner answers a very important question in his latest video discussion: What exactly is a SPAC?

Specifically, Wagner explains:

• The IPO process
• The SPAC process
• The rise of SPACs
• How investors should view SPACs

During the video, Wagner emphasizes the importance of understanding what SPACs truly are and reminds investors to be mindful of their goals when it comes to investing. As always, please do not hesitate to contact us with any questions. We are available via email or phone at (305) 602-9080.