The IPO market is getting ugly for many startups, but the sun is still shining for special-purpose acquisition companies, or SPACs — sort of shell companies with blank-checks to acquire other companies opportunistically.
SPACs are raising money hand-over-fist with public offerings, and since they have only 18 to 24 months to spend their stash, they’re eager to deal. Two SPACs, in fact, have recently cut deals with biotech startups, and chances are good they’ll be nosing around other venture sectors. Check out the SPAC phenomenon in this piece over at VentureBeat Life Sciences.
One Comment
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Herb T said:
Its interesting that spacs are still the rage as many that have been funded have still not located a target. We at VOIS.com understood that the IPO market was poor so we took a similar path and took control of an existing public company, retained a broker dealer and then conducted an offering to raise our capital. I must tell you that I feel many other companies will pursue blank-check Spacs or taking control of a public company to get their company funded until sox legislation is repealed or the Ipo market improves.
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