Betting on ‘blank check’ companies

These are strange days for the stock market. You can take a company public without actually having a business, customers, or revenue. And if you’re Woody Benson, you can do it from the master bathroom of your home in Bonita Bay, Fla., showing slides over Zoom to prospective investors.

Egregious Founder Shares. Free Money for Hedge Funds. A Cluster***k of Competing Interests. Welcome to the Great 2020 SPAC Boom.

It’s a brilliant, blue-sky afternoon in mid-August, and Bill Ackman is enjoying being, well, Bill Ackman.

Maybe it’s the sun. Or maybe it’s the aftermath of his latest tour de force — the IPO of a $4 billion special-purpose acquisition company, or SPAC, the largest of its kind during a year when such blank-check deals are exploding.

Competitive mobile game maker Skillz will do a quick IPO at $3.5 billion valuation

Skillz is going public this fall on the New York Stock Exchange through a special public acquisition company (SPAC). This has become a popular way for fast-moving companies to go public without all the hassle of a traditional IPO. SPACs are set up by managers who raise money in a blind shell company, and the investors don’t know what they’re putting their money into.