The next market bubble
Are SPACs creating a bubble for companies with minimal revenue but are in “hot” industries? Lots of capital chasing unprofitable companies
No bubble. Stonks only go up
Maybe a couple years ago, much harder to get these types of deals done now
I wouldn't necessarily call SPAC a bubble, I mean some might very well end up being one but it is more of a different mechanism to raise money and go public these days. You're probably right about the hot industry and unprofitable companies though - the EV market in general is just playing on a lot of speculations and expectations.
Echoing points above, SPACs aren’t rallly bubbles as they aren’t really trading at crazy multiples. Plus at the end of the day they are either dissolved or become a company, but there’s a lot of uncertainty with the future there so people will be cautious
I guess to clear up the post I don’t mean that SPACs are a bubble but are creating inflating values for companies like nikola with almost no revenue and just a cool business idea - the SPACs aren’t the bubble but the large amounts of capital and competition to acquire hot companies with no revenue creates a bubble since the value isn’t there
Would agree it’s not a bubble, way more so a trend and sentiment indicator of where LP’s see opportunity
No I don’t think special purpose acquisition companies are creating a bubble. I think special purpose acquisition companies add liquidity and value to the private market