Nearly three years ago, a special purpose acquisition vehicle (SPAC) spearheaded by investor Chamath Palihapitiya took the space tourism company Virgin Galactic public. It was the first human spaceflight company to trade on the NYSE — or any exchange, for that matter — and it was so successful that it almost immediately kicked off a SPAC frenzy.
The beauty of the mechanism, as Palihapitiya suggested to us last year, is that SPACs aren’t burdened by the same disclosures associated with the traditional initial public offering process. Whereas old-school IPOs are backwards looking and tell investors what a company has accomplished, a SPAC “actually allows you to raise a really large amount of money, to go to a broad base of institutional investors, and it allows you to tell them what you think the future can look like,” he said.
Still, the good times could only last so long. By late spring of

   

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