In a 2016 paper, Lora Dimitrova of the University of Exeter Business School dubbed SPACs “the poor man’s private equity funds,” Bloomberg reports. That’s because they give ordinary investors a way to participate in the purchase of a hot company before it goes public — a perk usually reserved for the wealthy.
It makes sense. The venture capital world is practically closed to “the poor man,” while fast-growing startups are staying private for longer. So individuals are turning to blank-check shell companies as their gateway to alternative investments. Read more.
