While SPAC Deals Commonly Floundered, Here Are Some That Did Better

In general, buying shares of venture-backed companies that took the SPAC route to public markets has not been a great bet, as we explored earlier this week.

However, it would be misguided to walk away with the impression that everyone taking the SPAC path fared poorly. This year, shares of several newly public companies are doing quite well, with a few seeing shares rise several-fold.

A great deal more companies, including some of the most well-known names like bioengineered products producer Ginkgo Bioworks and pet care platform Rover, are trading close to the initial share price of $10, which is the benchmark for SPAC deals.

So who are the top performers? We put together a list of venture-funded companies with shares trading recently at $14-plus.

Among this cohort of successful-so-far SPACs, a few in particular stood out. We rank them below:

No. 1: Lucid Motors

Electric vehicle-maker Lucid went public in July through a merger with the SPAC Churchill Capital Corp. IV. Prior to that, the 14-year-old, Silicon Valley-based company had raised over $1.3 billion in venture funding.

Since completing the merger, Lucid’s shares have soared, hitting over $55 a piece in late November. Since then, the stock has ticked down, recently closing around $40 a share and delivering a market capitalization around $66 billion, which is higher than Honda. Lucid makes luxury cars, and is currently accepting reservations for its first model, the Lucid Air, which starts at around $77,000.

No. 2: Enovix

Fremont, California-based Enovix, a maker of advanced lithium-ion batteries, has been plugging away at its mission since 2006, raising more than $190 million in venture funding along the way. In February, the company announced plans to go public via a merger with the SPAC Rodgers Silicon Valley Acquisition Corp.

Enovix completed its merger in July. Shares peaked in November and were recently going for around $26 per share.

No. 3: Matterport

Silicon Valley-based Matterport develops a 3D data platform for visualizing and analyzing spatial data used in real estate and other industries. After raising more than $110 million in venture funding, the 10-year-old company announced plans in February to go public via a merger with the SPAC Gores Holdings VI.

Since completing its merger in late July, shares mostly trended upward till November. Since then, the shares have shed about a third of their value but are still trading around $22 each recently, giving Matterport a market cap of more than $5 billion.

No. 4: ChargePoint

ChargePoint, a provider of charging infrastructure for electric vehicles, is one of the more heavily funded companies to take the SPAC route to market. Founded in 2007, it raised over $650 million in venture funding before announcing a merger last year with Switchback Energy Acquisition Corp.

Since completing its merger in February, ChargePoint shares have mostly trended lower, having hit their peak in the weeks after the deal was first announced. But shares are still around $19, giving the Campbell, California, company a market cap of around $6 billion.

If this is a lottery, winners are not clear

When going public via SPAC first became a popular thing for venture-backed companies a few quarters ago, one interpretation was that this would be a high-risk, high-reward proposition for public investors. That is, while many of the predominantly unprofitable companies would fail to deliver, a few would succeed wildly.

So far, that plotline hasn’t really come to pass. The number of SPACs we track that are trading well below the $10 baseline outnumber those well above it. We haven’t found a breakout SPAC deal that delivers a 10x or higher return to early investors.

That said, it’s still early days. It typically takes years, not months, to deliver the biggest returns. And who knows? Bargain hunters may find some deals now that the SPAC class of 2021 is trading at a discount.

Illustration: Li-Anne Dias

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