| Hi! This is Crystal Tse with Bloomberg's deals team. It feels like a good time not to be at the mercy of Wall Street fluctuations. Investors are bracing for chaos with the U.S. president hospitalized, Covid-19 ripping through Washington, D.C. and a fiercely contested presidential election just weeks away. That promise of looming volatility dovetails neatly with tech's new favorite financial structure: the SPAC, or special purpose acquisition company. SPACs are having a moment. So far this year, they've raised $47 billion, according to Bloomberg data. That's more than in the past 10 years combined. Last week alone, Richard Branson's SPAC raised $480 million and the concept got its own exchange traded fund. SPACs are billed as a shorter, more predictable route for startups looking to become public companies, though they also can come with greater risks. Here's how it works: An investor or group of investors raise money for a so-called blank-check corporation with no operations, and then merge that corporation (the SPAC) with a separate private company within 24 months, effectively taking that private company public. Going public with a SPAC, instead of a traditional initial public offering, has been particularly popular with tech startups—like online wellness company Hims Inc. and home sale website Opendoor—though other companies—like Playboy Enterprises Inc.—have also jumped on the bandwagon. The list of tech leaders who have created SPACs is long. It includes billionaire Peter Thiel, LinkedIn Corp. co-founder Reid Hoffman and Zynga Inc. founder Mark Pincus. On Friday, former Uber Technologies Inc. executive Emil Michael filed with the Securities and Exchange Commission for a $250 million SPAC that targets technology companies with an enterprise value of $1 billion to $2 billion. The payout for the SPAC managers can be high. If they own about 20% of the SPAC's equity, a typical cut, that stake could turn into millions of dollars when they strike a deal to take a company public. For startups, one reason SPACs have been so attractive is that they offer certainty. With an IPO, management gets on the road, meets investors and determines a listing price at the end of an elaborate roadshow. While that's happening, market sentiment could change, and on pricing day, unforeseen events could affect the listing outcome. With a SPAC, both parties take their time to agree on the company's worth, largely in private, and once the deal price is set, it is mostly unswayed by market volatility. That could be especially attractive during a chaotic news cycle. Of course, there's also a downside to taking a side door to the public markets. Less public scrutiny and a smaller group of investors could mean a greater potential for flops. Embattled electric car company Nikola Corp. may prove to be one such example. But as long as U.S. headlines are becoming increasingly surreal, don't expect the SPAC boom to slow down. —Crystal Tse | 
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