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SPACs' Prognosis 📉

SPACs' Prognosis 📉
June 2, 2022

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SPACs were all the rage in 2020. Like COVID, they spread like wildfire, from Silicon Valley to New York. But the same high-growth companies that nabbed headlines and major valuations when they went public are now seeing stock prices plummet and operating losses accelerate.

The Wall Street Journal recently reported that shares of companies that listed via SPAC in 2021 are down nearly 60% overall. The electric scooter company Helbiz found a willing SPAC partner based on its "clear path to profitability” but still ended up with a $72MM loss.

That kind of unmerited rosy picture has made SPACs a target of SEC attention. The regulatory body wants more oversight into how much fantastical projecting companies can do when listing via SPAC, in order to avoid these very glaring pitfalls. Elizabeth Warren, the vocal consumer advocate and legislator, just introduced a proposal to regulate SPACs even further than the proposed SEC rules.

Amidst all this bad press, Forbes magazine did what any reasonable press entity would do, and backed out of its announced merger with a Hong Kong-based blank check company at a $630MM valuation.

For now, these companies might consider the same business advice given by startup accelerator, Y Combinator. It's never too late to pursue profitability.

Crickets at the NYSE
No new companies listed this week.
What gives?
Intel heads to Ohio
Semiconductors will create thousands of jobs in Columbus, Ohio.

Since last week, PrivCo has added:
1,911 Companies | 346 Funding Activities | 118 M&A Deals

Funding & Deal Highlights:

Railway raises $20MM from Redpoint

Platform • Round A • San Francisco, CA

Acrisure raises $725MM from ADIA 

Insurance • Round B-2 • Grand Rapids, MI

Astro raises $60MM from Accel

Apps • Round B • West Jakarta, Indonesia

Vendia raises $30MM from NewView 

SaaS • Round B • San Francisco, CA

Vibenomic raises $12.3MM from Panoramic

Advertising • Round B • Fishers, IN

FinditParts raises $30MM from Crestline

E-Commerce • Round A • Los Angeles, CA

ShareChat raises $300MM from Alphabet

Communications • Equity • Bengaluru, India

Felt raises $15MM from Footwork

Software • Round A • Oakland, CA

Surefire raises $10MM from ForgePoint

Cyber Security • Round A • Summit, NJ

Sugar Cosmetics raises $50MM from L Catterton

Cosmetics • Round D • Mumbai, India

Gold Fields announces acquisition of Yamana

Mining • Acquisition • Toronto, Canada

Stepping Stones acquires HM Therapy

Pediatrics • Acquisition • Oceanside, CA

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