SPACS

Only invest what willing to throw away..

Basics.. you find some rumors of guys investing in them and follow their leads…,
I followed theil.. seible.. gates etc..

They will be putting money into funds with friends on things they like.. you invest in the fund managers more than the specific spac..look at things you think have growth..

You invest and the price is 10 dollars.. you are investing in an idea and guys and rumors that they are making a deal with someone you think is going to be great.. but it is not set in stone.. it could end up being an entirely different thing they finally decide to fund and go spac with.. so people are buying the idea ( spac name) and it get hot you can go up quickly.. but then die just as quick..ie they announce the deal and you find out instead of AI they decided to go with a coal company .

You can sell and try to make money on that…. Buy the idea early.. and if gets popular sell to late lookers. If they fall apart and can not get a deal made after a set time they close the fund … you get your ten dollars back plus a little interest…they tend to die or rocket very quickly.. if they go up not unusual for them to die on the vine later.. after spac guys made their money and the actual company has to show true business value.

Ok.. now warrants.. you buy these and they are like buying they right to purchase the stocks later.. these are usually what people like to flip more

Then restricted warrants.. extremely risky.. you give them some money and HOPE they make a deal.. if not you lost it all..

I played a lot of spacs.. lost on most.. unfortunately the ones I thought were solid died(lucid etc)… went super risky on a few ( got bitdeer for 1.16— I think it is 20 now)…

But I bought some real stinkers!!!.. my plan was cast a wide net.. figure most would die but a few would take off..

As a bucket I am positive.. and I view theses as unicorns.. I hope I have a few Netflix.. apple.. etc in there that when my kids look in twenty years they smile.

I moved them all into a Roth IRA a year back when they were waaay down.. the Roth has more than doubled since I moved them.

It is complicated .. risky.

Fwiw I picked up archer and Joby as spacs.. lost a bunch on them and actually added later when they were down as companies.

SPACs have the potential to give retail buyers the type of advantage that the big banks have in buying IPOs. You can get the company at a safe price point with potential for big profits. 2021 made a bad name for SPACs, as the end quality of the companies turned out to be extremely low, which is why they went SPAC instead of IPO.

The quality of companies IPOing appears better this time around. This time we’re seeing lots of companies in high flying speculative industries that have a chance. I’m in GSRT, HOND, and GIG, all SPACs merging with nuclear SMR companies. All nuclear is speculative, but all three have extremely small valuations compared to OKLO/SMR, so they can make you big profits just on being early. I’m also in CCCX, merging with a quantum computing company like IONQ. CCCX notably had been considered as good of quality as IONQ and much better than the RGTI/QUBT type quantum companies until their valuations shot through the roof. But as part of the SPAC valuation, I’m buying CCCX for pennies on the dollar compared to IONQ

Once there is positive news on the SPAC and it seems likely the new company will go public, the price can increase well above the $10. The $10 is just the threshold if nothing happens after 2 years typically, that the money has to be returned. and of course once public, it can go well below $10 too under the new company

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Fundamentally speaking it’s basically a short cut for a company to take their company public. The SPAC has done all the regulatory work

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This is false.

SPACs I’m in currently:

Nuclear reactors:
GSRT
HOND
GIG

Quantum computing:
CCCX

Note: GSRT becomes NKLR tomorrow 10/8

SPACS are beneficial to the the SPAC creator. They are at the front of the line with respect to returns. Unlike IPOs, there’s little to no information for a retail investor to do due diligence. In most cases you’re probably better off buying the company after listing once the price drops.

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SPACS are beneficial to the the SPAC creator

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The economics and incentives for the SPAC creator are borderline criminal

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How so? Sponsor capital is fully at risk. IPO investors have an absolute right to get their money back - NO MATTER WHAT.

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Sponsor’s get warrants and promotional shares. Look up SPAC Jesus as the perfect example.

The great thing about a SPAC, is you can invest in something boring like a flooring company with little chance for growth. Overnight is has the freedom to change course and become the industry leader for Web3 cross border payments.

I agree with you, SPACs are much less rigged and anti-retail than IPOs. The IPO process is absolutely crooked and stacked in the banks’ favor. SPAC return to SPAC companies is generally tied to stock price performance, so they win when investors win. Plus the risk you mentioned of finding no quality merge companies