00:00Betsy, I got to start with you because you know the SPAC world really well.
00:04You are one of the, you're a legend in SPACs, I think it's fair to say.
00:08What makes this class different?
00:102026 volume is starting to pick up.
00:13What makes 2026 different than, for example, when we saw the other high watermark of 2021?
00:19I think that people understand that it's not a slam dunk, so to speak.
00:25That it takes a certain amount of skill and knowledge and knowledge of the capital markets in order to complete
00:35a SPAC.
00:36There were a number of SPACs that commenced during 2021 that never could complete for a variety of reasons.
00:46And so both the sponsors and the investors are much more cautious and maybe more knowledgeable.
00:55Would you agree with that, Anna, that what we're seeing now is a more cautious SPAC investor and SPAC groups?
01:02Yes, we're seeing SPAC sponsors that are significantly more experienced.
01:07And we're seeing SPAC sponsors that are repeat SPAC sponsors.
01:14So that certainly brings the experience that Betsy is talking about.
01:17There's also the benefit of SPACs coming to market with the amendments that the SEC adopted to the SPAC IPO
01:27and de-SPAC regime.
01:28So that brings certainty that we didn't have in the 2021-2022 market timeframe.
01:36And that's important.
01:37There's also a slightly more favorable view towards SPACs in the current SEC administration.
01:44Do you think, and Christine, let me bring this to you, given all of those, what is the reasoning why
01:50you think that volume has been picking up last year and this year?
01:54After we saw, again, just 2021, huge amounts of volume, crashes pretty significantly.
01:59Why are we back on the up and up?
02:01I think that SPACs work really well for a certain type of transaction.
02:06You know, obviously, in a traditional way, IPO, you can't give projections, but in a SPAC, you can.
02:12So if you have a company that's evolving, shifting, growing rapidly, then it can be really beneficial to have that
02:19projection and that forward-looking statement.
02:21So we're seeing a lot of growth and, you know, topical interest in things like AI, data centers, quantum, as
02:29you guys already mentioned.
02:30And that really benefits from that, the forward projections, because the companies are going to look really different in five
02:37years than they look today.
02:38So the SPAC is a really good product for bringing those companies public.
02:42Christine, could you outlay just where Periscope invests and exists in the SPAC universe?
02:48What are the interesting opportunities for you right now?
02:50So Periscope participates through all stages of the SPAC ecosystem, from, you know, early-stage risk capital transactions all the
02:58way through de-SPACs.
02:59We're seeing a lot of really interesting things, both on the IPO side and the de-SPAC side, in particular,
03:06the AI and data center build-out.
03:09You know, those are sectors that are going to require a lot of capital, and they're going to require it
03:13relatively quickly.
03:15And there's significant demand in the area.
03:17So it really works well with the SPAC structure.
03:21And we're seeing both de-SPACs happening there.
03:24You know, Boost Run is a really good example of that.
03:26And also a lot of IPOs that are going to be seeking in that region.
03:30Betsy, you know, you've been a serial SPAC sponsor in this market, and I think it's fair to say one
03:34of the most respected of that.
03:35What do you think the big opportunities are right now?
03:39You know, the SPAC is just a legal vehicle.
03:44It, as Christine said, is good for some companies and not for others.
03:49It was initiated in the 1990s for the steel companies.
03:56They couldn't raise money, and this was a way for them to proceed and to infuse capital.
04:03We now have a whole different group of companies that need capital, whether it's data centers or nuclear stations or
04:13AI or anything that you might think of that has a capital, deep capital and continuing capital need.
04:24And these are the countries that are going to go to the public markets because it gives them the window
04:31to continue to raise capital.
04:35Today, you mentioned quantum.
04:38Quantum is certainly one of the areas in which there is a deep, deep need for capital in order to
04:47get the quantum universe up to an application stage.
04:54And therefore, revenue generating.
04:57So, there are a variety of opportunities.
05:03A lot of them are in technology.
05:06You know, we've just seen the mother or father, depending upon your point of view of it all, you know,
05:14in SpaceX.
05:15SpaceX has been continually a capital raiser in the private markets and very successfully so.
05:25But it then matured to the point where it could, in fact, be predictive.
05:32And that allowed it to become a public company and to access those public markets.
05:39I mean, Anna, Betsy makes an interesting point just comparing it, you know, SPACs coming back with some volume and
05:46just the IPO market coming back in general.
05:48Does one cannibalize the other?
05:50Like, is it problematic to have successful IPOs coming back and companies maybe saying, I can go that route.
05:56I don't need to, you know, go to a SPAC and have that SPAC de-SPAC?
05:59Not at all.
06:00They complement each other.
06:02In fact, I think that the resurgence in SPACs is in part due to the fact that there is an
06:09attractive IPO market.
06:11And I think there's a certain part of the resurgence in SPACs that we can say is because there's a
06:20healthy IPO market.
06:22That provides a little bit of an incentive or some exuberance or enthusiasm to founders and to boards of target
06:32companies, private companies that see that and that see that the equity markets are alive and well and receptive to
06:41good companies.
06:43The IPO market may not necessarily be available, to Betsy's point, for companies of all sizes.
06:51Some may have to approach the market through a combination with a SPAC.
06:56And I think many companies are agnostic, whether they go public through a combination with a SPAC or do it
07:04in a traditional IPO.
07:05It does seem like just, you know, you mentioned, we've all mentioned quantum, actually, to be fair.
07:09And, Christine, I just wonder, is there space for companies to be targets of SPACs that aren't quantum, that aren't
07:16AI-related?
07:17Is there any room for, like, a more sort of traditional-type company that maybe, again, has that high capital
07:23need but doesn't exist in the AI infrastructure quantum sort of ecosystem?
07:28Definitely.
07:28I meet with de-SPAC targets very regularly.
07:32And sometimes I come out of the meeting, I say, you know, what a boring company.
07:36But I mean that in such a positive way.
07:38You know, they have steady revenues.
07:40They might not be, you know, the next big quantum or AI robotics thing, but they're, you know, a stable,
07:46steady company.
07:47And, you know, we love to see them go public through a SPAC.
07:50It just adds more credibility to the market when they do that.
07:53I only have about, you know, less than two minutes left.
07:56So I just want to quickly, I would love to get a sense check from all three of you.
08:002021 was the high watermark.
08:02Can we ever get anywhere close to those types of levels?
08:05Betsy, let me start with you.
08:06I don't think we should.
08:09You know, we're not doing this in a vacuum.
08:11We're doing this in the context of external factors.
08:18And the market, as Anna said, is certainly a critical one.
08:22I don't think we need to get back there.
08:25We need to move forward with high quality sponsors, knowledgeable individuals, companies that have performance either ahead of them or
08:39behind them.
08:39And so I would say that's not that's not a goal I would like to reach.
08:46Anna, would you agree with that?
08:48I agree.
08:49I do think it's important to flag that the SEC proposals rolled out just recently on registration reform favors SPACs.
08:58They would make it possible for SPACs to have a shelf sooner.
09:03So they make SPACs a more positive alternative.
09:08OK.
09:08So good news for SPACs.
09:10And Christine, let me let me wrap it up with you.
09:122021 high watermark, not something we should really be aspiring to do?
09:15No, we don't need to go back to that.
09:17We have a much more disciplined group of investors and group of sponsors.
09:21And we really learned in 2021 that credibility matters much more than hype.
09:26So I think the SPAC market's at a healthy point right now.
09:29And this is probably a good level for it to stay at.
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