Trump’s SPAC, explained

With how wild 2021 has been, it was inevitable that the following sentence would be typed by business journalists: Donald Trump is rolling out a SPAC.

As a quick primer, a SPAC is “special purpose acquisition company” that raises money into a public shell corporation before acquiring a business (we wrote an explainer here).

Trump’s venture is called Truth Social…

… and plans to merge with a SPAC called Digital World Acquisition per Axios.

The venture is supposedly Trump’s effort at building a new media empire, but details are lacking:

• What’s the product? So far, there’s a preorder for Truth Social in the App store (Axios says it looks like a “reskinned Twitter”).
• Who’s running it? The SPAC sponsor Patrick Orlando has not completed a successful SPAC merger, and the only other names mentioned are Trump as chairman and Scott St. John as a streaming producer.

Shares in the vehicle ($DWAC) jumped 300%+ on the news and trading was halted multiple times because of volatility.

The larger ambition…

… is an entity called the Trump Media & Technology Group. In a 22-page slide deck, the competitive landscape includes over $5T in market cap value (CNN, Twitter, Facebook, Amazon Web Services, Stripe).

Unsurprisingly, there are no further details.

Somehow, this isn’t even the wildest SPAC announcement this month. Two 20-something frat brothers — one the scion of a Dallas energy family — just raised $125m to find a Latin American acquisition target.