SPACs were one one of the hottest investments on Wall Street early last year, booming alongside cryptocurrencies, meme stocks and other speculative trades as an easy way for buzzy startups to raise money and go public.
Fast forward 18 months and much of the air is out of the bubble. Shares of companies that went public this way have tanked. Some of the firms have already been acquired by other companies. Some startups that previously agreed to go public by combining with special-purpose acquisition companies are calling off deals and electing to raise money privately. Those who set up SPACs stand to lose a lot of money if they can’t find deals.