Author: OurCrowd

What is a SPAC and Why Should I Care? Over the past year special purpose acquisition companies (SPACs) have become the hottest commodity in the initial public offering (IPO) market. A few years ago, SPACs were rare and were considered by many to be somewhat disreputable: it was felt that only a company that wasn’t strong enough to go the traditional IPO route would go public via a SPAC. That changed dramatically last year. In 2020, SPACs raised half as much money as traditional IPOs, and, as reported by Reuters, for the first quarter of 2021 they’ve raised 76% as much money as traditional IPOs. Clearly SPACs are a hot ticket in the world of finance right now. Two of OurCrowd’s portfolio companies – Arbe Robotics and Innoviz Technologies – have exited via SPAC, and we expect more to follow. However, the recent boom in SPAC offerings is drawing additional scrutiny from regulators, which may put a damper on the current frenzy. The US Securities and Exchange Commission (SEC) is concerned because a number of companies that went public...