For the first time, Main Street investors can be part of raising a blank-check firm of their own.
A new special purpose acquisition company, dubbed The People’s SPAC, is seeking to disrupt the status quo, according to people with knowledge of the matter and a presentation obtained by Bloomberg.
The London-based vehicle is led by chairman Edward Frazer, co-founder of alternative asset merchant bank Trinity Group; CEO Warren Rogers, head of Downing Ventures; and CFO Khing Oei, a former hedge fund executive and founder of AlphaSwap. It is planning to raise sponsor equity by crowd-funding, according to the presentation calling the effort “OurSPAC”.
The SPAC is seeking to raise no more than $100,000 per accredited investor, giving Main Street participants a way to become blank-check firm owners before an initial public offering, and offering a bigger slice of potential profits, the presentation shows. Sponsor equity is traditionally awarded to founders at a sizable discount in exchange for launching the SPAC and covering IPO costs. It also comes with an added bounty, known in the trade as the “promote.”
The People’s SPAC may target a deal in the software, gaming, media content or entertainment sectors in Western Europe, and is looking at a Nasdaq listing in the second quarter, the presentation shows. It’s interviewing underwriters and negotiating the provision of equity and promote in an attempt to reduce upfront fees, the people said.
A People’s SPAC representative declined to comment.
In the past 12 months, more than 700 SPACs—mostly backed by billionaires, business titans, private equity, venture capital and even corporations—have flocked to New York exchanges, seeking to raise a combined $227 billion, according to data compiled by Blomberg.
This article was provided by Bloomberg News.