Capital SPAC Sponsor I LLC 10X stock holdings and net worth by SEC Form 4 filings Mar, 2024 (2024)

FAQs

What is a SPAC sponsor? ›

What is a SPAC? Special purpose acquisition companies (SPACs) have become a preferred way for many experienced management teams and sponsors to take companies public. A SPAC raises capital through an initial public offering (IPO) for the purpose of acquiring an existing operating company.

What is the difference between SPAC and de-SPAC? A SPAC is known as a blank-check company that's publicly traded and exists to acquire another business, typically to take a private company public. To de-SPAC, the SPAC makes its acquisition, thereby changing from a SPAC to a newly merged entity.

10X Capital utilizes data science to identify and evaluate investments, as well as support portfolio companies' strategic growth, and through its network of relationships with founders, executives and venture capitalists, routinely meets with a variety of startups seeking investment.

Cost. Underwriters' fees for a SPAC are typically 2% of the amount raised upfront with a further 3.5% contingent on a deal taking place. This 5.5% is less than the 7% often charged for a traditional IPO.

Sponsors typically get around a 20% stake in the SPAC in return for a relatively small cash investment e.g. $25,000 (although these terms are becoming less generous for sponsors as the market develops). This is how they make their money. If the SPAC is successful, their shares will be worth a significant amount.

The capital provided by the Sponsor generally represents 5% to 7% of the anticipated SPAC IPO gross proceeds. For example, if you plan to raise $200M in your IPO, the sponsor capital must be at minimum $10M.

Going public with a SPAC—cons

The main risks of going public with a SPAC merger over an IPO are: Shareholding dilution: SPAC sponsors usually own a 20 percent stake in the SPAC through founder shares or “promote,” as well as warrants to purchase more shares.

Special Purpose Acquisition Companies (SPACs) are publicly traded companies formed for the sole purpose of raising capital through an IPO and using the IPO proceeds to acquire one or more unspecified businesses in the future.

SPACs offer target companies specific advantages over other forms of funding and liquidity. Compared with traditional IPOs, SPACs often provide higher valuations, less dilution, greater speed to capital, more certainty and transparency, lower fees, and fewer regulatory demands.

However, in a different context, you could say that a stock is trading at 10x earnings, for example, that would just mean that the current price of the stock = its annual earnings per share x 10.

What is the 10x investment rule? ›

While it is true that angel investors (like our dragons) typically seek 10 times their money back over 3-5 years that isn't the source of the "10x rule". The 10x rule means that in order to gain market traction a product must be exponentially better. ie 10 x faster, 10x smaller, 10x cheaper, 10x more profitable.

That depends on the vehicle you decide to invest in. For our accredited vehicle, we intend to pay distributions monthly but may change the frequency at our sole discretion during the term of the fund. For our non-accredited vehicle, we intend to pay distributions at least annually and our target is quarterly.

Typically, SPAC sponsors receive roughly 20% of the common equity in the SPAC and 3% to 5% of IPO proceeds. A SPAC can purchase one or more companies, and the managers of a SPAC typically earn a percentage of the value of a potential deal (commonly around 5%).

To exit their investment, shareholders can choose to either a). sell their shares in the open market at prevailing market prices or b). opt to redeem their shares when the SPAC announces a proposed business combination.

A SPAC typically invests the money it raised when it was formed in government bonds or other safe investments to earn a modest return while limiting potential downside while it searches for a merger partner. Buying shares in a new SPAC amounts to a leap of faith, but the payoff can be substantial.

Typically, the sponsor receives about 20 percent of the SPAC's value (inclusive) in equity in the combined company. Those shares will benefit from a rising stock price. — Lockups create discipline. For most SPACs, the sponsor must hold the promote as equity in the combination for one year.

A special purpose acquisition company (SPAC) is formed to raise money through an initial public offering (IPO) to buy another company. At the IPO, SPACs do not have business operations or stated targets for acquisition.

A private equity fund is managed by a private equity firm, often called a private equity sponsor or financial sponsor. The fund is the investment or capital used to buy a controlling interest in a private company. The sponsor is responsible for operating the fund.

The economic interests of the entity or management team that forms the SPAC ('sponsors') and the directors, officers and affiliates of a SPAC may differ from the economic interests of the public shareholders; this can lead to conflicts of interest.