ACQ2 by Acquired Primer on SPACs with Kevin Hartz and Troy Steckenrider of A* and AONE
Aug 25, 2020
Kevin Hartz, founder of Eventbrite and early PayPal investor, joins Troy Steckenrider, co-founder of A* and AONE, for an insightful deep dive into SPACs. They explain how SPACs provide an alternative to traditional IPOs with streamlined processes and greater accessibility for innovative startups. The duo highlights the evolving landscape of SPACs, including their implications for venture capital and investor relationships. They also explore due diligence, the PIPE process, and the strategic role of SPACs in democratizing access to the public markets.
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SPAC Pricing vs. Traditional IPOs
- SPAC IPO pricing differs from traditional IPOs, typically at $10/share/unit, regardless of demand.
- Focus shifts to attracting long-term strategic partners rather than maximizing price.
SPACs: Evolving Beyond LBOs
- SPACs, historically associated with leveraged buyouts and arbitrage, are evolving.
- They now aim to be an alternative to traditional IPOs, focusing on high-growth tech companies.
SEC Regulations on Pre-Agreements
- If a SPAC had a pre-agreement with a target company, it'd resemble a backdoor IPO.
- The SEC mandates SPACs operate as blank check companies to avoid this.