Shift Technologies Inc. Chief Executive George Arison didn’t even know what a SPAC was until last year. Now, his San Francisco-based online marketplace for used cars is hopping aboard the blank-check train on its way to becoming public.
Special-purpose acquisition companies, also known as SPACs or blank-check companies, have been around for decades, but have made a big comeback this year amid the pandemic, thanks to low interest rates and stock-market volatility. Sports-betting operator DraftKings Inc.
electric-vehicle maker Nikola Corp.
electric-truck powertrain maker Hyliion Holdings Corp.
and space-flight company Virgin Galactic Holdings Inc.
are among the companies that have gone public via the SPAC route.
SPACs raise money in an initial public offering, then look to buy businesses, usually within a couple of years. When a SPAC finds a business and successfully negotiates the transaction, the two merge and the acquired business becomes publicly