It would be interesting to see if reducing reporting requirements allows more startups to go public earlier in their journey, hence opening up more opportunities for public to participate in the upside!
The overall idea of SPAC’s is not bad, even if Chamath only created them to exit his sh*t investments. There are very few other ways for retail investors to invest in potential 100-1000X companies (which are generally pre-revenue). Of course the flip side, is that most SPAC’s might close down and cause you to lose money. That is the decision for the investor to make, risky opportunities are fine! Sadly chamaths shitty tactics to close out his investments have tainted a completely fine idea.
Can you really invest only 50k into OpenAI? That seems low to me.
However, some small companies are okay with small investments. You have to negotiate privately, that's just how it is. If it was a simple, uniform process, they'd be on the stock market.
"I have this exciting bag-holding opportunity for you."
If such a company succeeds and still retail investors, don’t get paid back, I would consider that fraudulent, but that’s not the case with SPAC’s. I would like to see SPAC deals be better to investors as opposed to banning them entirely.
It is. It’s a workaround.
More directly, SPACs are financially engineered to extract wealth from retail. Every weird interest-rate, guaranteed-floor and private-placement provision is geared for it. We have a crap IPO process, in part due to reporting requirements, so sometimes the gamble works out.
Surely they wouldnt mind bragging about their fantastic GAAP P&L in their filing docs. Maybe its the pesky quiet period theyre trying to avoid, so they can be even more transparent about finances and equity holders.
In practice, companies like Stripe, OpenAI, etc have stayed private because they've been able to access the cash they need at valuations they're happy with and because no one wants to open their books unless they have to. They aren't staying private because being a public company is hard.