Show an ad over header. AMP

I am the FIRST!!!

SPACs go to Congress

House lawmakers targeted SPACs during a hearing today following a year of unprecedented deal activity.

Why it matters: Congress may decide to draft new legislation that would take away one of the advantages of going public through SPACs versus a traditional IPO — the ability to make forward-looking statements.


  • The SEC has signaled it could do the same.

What they're saying: Stephen Deane of the CFA Institute testified that the safe harbor rule governing what you can say about the future is a “singular regulatory advantage” that SPACs have over IPOs.

  • Andrew Park of Americans for Financial Reform also testified that because SPACs are not subject to the same liabilities for making false and misleading forward-looking statements, the method has “emboldened” pre-revenue companies (electric vehicles, cryptocurrency, space exploration) to make “what might generously be called very rosy projections.” 
  • “What’s most concerning is that retail investors are buying into this kind of hype,” Park added.

By the numbers: The witnesses cited how much SPACs have underperformed their peers or the broad market.

  • Park pointed to a Goldman Sachs index of 200 SPACs that saw average losses of -17% compared to a 10% return in the S&P 500 this year.
  • Deane noted that for every year since 2010, the one-year post-merger performance of SPACs has underperformed the Russell 2000 by 10% or worse.

The big picture: Congress is concerned about protecting retail investors, a theme that has been present since the meme stock trades earlier this year.

What to watch: Even with the growing scrutiny, SPACs aren’t dead. They’ve just been slower coming to market given the existing backlog of reviews. 

regular 4 post ff

infinite scroll 4 pff

Test HG LIsticle Slug

Particle LSUGS

new particle slug

new particle slug body

new particle slug 2

new particle slug2

new particle slug3

new particle slug3

Valuations for venture-backed companies at record highs

Valuations for U.S. venture-backed companies are at record highs, per data released this morning by PitchBook.

Between the lines: It's the new normal, in which nontraditional investors are traditional, unicorns are pigeons and startups are in the driver's seat.

Keep reading... Show less

Discovery CEO David Zaslav signs new contract through 2027 amid AT&T mega-merger

David Zaslav will stay on as Discovery CEO through at least 2027, leading the massive joint venture with WarnerMedia announced on Monday, sources tell Axios.

Driving the news: Zaslav's new contract will be announced next week in conjunction with the name of the new company that he just unveiled with AT&T CEO John Stankey.

Keep reading... Show less

Stuart Haselden steps down as CEO of luggage startup Away

Stuart Haselden is stepping down as CEO of smart luggage-maker Away, Axios has learned. He'll be succeeded on an interim basis by company co-founder Jen Rubio, and an outside search firm has been retained to find a permanent successor.

Why it matters: Haselden, formerly with Lululemon, appeared to have established executive stability at Away, whose co-founder Steph Korey previously resigned as CEO before retaking the reins alongside Haselden and then resigning again.

Keep reading... Show less

Insights

mail-copy

Get Goodhumans in your inbox

Most Read

More Stories
]> &lol4;