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- Chris Sacca has been invited to sit on SPAC boards and do nothing.
- The venture capitalist tweeted that many SPAC directors are “window dressing.”
- Charlie Munger, Jeremy Grantham, and other top investors have criticized SPACs.
- Visit the Business section of Insider for more stories.
Billionaire investor Chris Sacca tweeted on Tuesday that he’s been invited to sit on the boards of several special-purpose acquisition companies (SPACs) – with no expectation that he does any work.
“I’ve been offered a bunch of SPAC board seats,” the former “Shark Tank” star and Lowercase Capital founder said. “The pitch usually goes something like, ‘You’ll get [lots of shares] for just putting your name on it and doing nothing.'”
“While there are some board members actively helping, too many are just window dressing,” Sacca added. “Don’t get distracted.”
SPACs typically aim to secure a stock-market listing then acquire a private company, offering businesses an alternative way to go public than an initial public offering (IPO).
The number of SPACs has exploded in recent months as investors such as Bill Ackman and Chamath Palihapitiya, celebrities including Alex Rodriguez and Colin Kaepernick, and ex-politicians such as Paul Ryan and Gary Cohn have jumped on the trend.
Sacca – an early investor in Uber, Twitter, and Instagram – has shifted his focus towards tackling issues such as climate change and voter suppression in recent years. He isn’t the only high-profile investor to voice concerns about SPACs recently.
Warren Buffett’s business partner, Charlie Munger, dismissed them as “crazy speculation” and evidence of an “irritating bubble” in February.
Similarly, GMO cofounder Jeremy Grantham – who unintentionally made a fortune when one of his investments was acquired by a SPAC last year – slammed them as “a license to rip investors off” and suggested they should be banned.
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