Investors’ SPAC push can modernize the money game in the private market – TechCrunch

Is this venture capital natural development?

Since last year, we have traced the growing list of capitalists who came into the SPAC game. You can read an interview we conducted with Amish Jani, co-founder of FirstMark Capital, about his SPAC here. And if you need a refresher on all things SPAC, we have that for you too.

This morning, I will better understand the trend by analyzing a few new venture capitalist SPACs. we investigate Teacher Hippeau Acquisition Corp. and Khosla Ventures Acquisition Co. IN, II and III. The SPACs are somewhat clearly associated with New York-based Lerer Hippeau and Menlo Park’s Khosla Ventures. And all four dropped formal S-1 archives last week.

Børs explores start-ups, markets and money. Read it every morning at Extra Crunchor few Exchange newsletter every Saturday.

Today’s topic may sound dry, but it really does matter. As we have reported, Lux Capital Are you on the SPAC effort together with Ribbit and of course, SoftBank. Adding our latest names to the mix, and you have to wonder if every VC worth cursing in the future will have their own range of SPAC offerings.

In the way that some venture capital funds in the late stage invested earlier – and now later – VC outfits with full service will offer first check for final liquidity. Will such a full stack venture outfit be able to win more deals than a group offering a limited set of financing options? In that case, the recent SPAC wave of venture capital could become more of a rising tide over time to torture a metaphor.

Either way, let’s quickly analyze what Khosla and Lerer Hippeau are saying public investors on why they want to be big SPACers before we work our way back to what the resulting pitch should be for startups themselves.

Full-stack capital

Clay Hippeau SPAC is the most interesting of the two companies’ total four offerings, so we start there. It is not to diss Khosla, but Lerer Hippeau blankcheck has an explicit wording that I would like to highlight.

Read the following from the archive Lerer Hippeau Acquisition Corp. S-1 (bold: TechCrunch):

As our seed portfolio matured over the past decade, we added a growth strategy to our platform through our selected funds. This capital enables us to continue to provide financial support to our best performing companies in the early stages of scaling and selectively make new investments in later stages of the Lerer Hippeau network. As our portfolio now matures to the stage where many are considering public markets, we see SPACs as a natural next step in the development of our platform.

After writing that it has had four portfolio companies “published announced business combination agreements with SPACs” and noting that it expects more of the same, Lerer Hippeau added that it considers its “expansion into the SPAC market as a very complementary element. in our strategy to support founders throughout their entrepreneurial journeys. ”

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