Ben Gilbert: prediction

Transcript context

…You have one in here, SPAC index fund. Tell me what you’re thinking. Hear me out on this. I don’t know how long the opportunity exists to do this. But at least for the moment, there is this rush of everyone who has sufficient connection to capital. Raising that capital into a SPAC, and hoping in the next two years that they can leverage relationships with entrepreneurs to get a deal done and take someone public. You’ve probably talked about SPACs on your show. We’ve talked about it in our LP program. I don’t want to go into too much detail about the mechanics. But I think if you were to bet on SPACs as a whole and say they all go public, they trade right around $10 a share because they’re effectively worth exactly the amount of cash that they have in the bank, which is a trust in the Cayman Islands or something that's untouchable. Then at some point, they announce an acquisition, and you either can redeem and get your money back, or you can roll it into the acquisition. In general, I think we’re going to see 20+ of the series C (or later) startups go public through this mechanism of SPACs in the next couple of years. There are two levels of appreciation here. There’s the first one where you buy in at $10 a share and then there’s a pop when they announce who they’re going to buy. You could play the pop game if you want to, and then just cash out immediately after that. Or you could play the longer-term game and say, do you want to hold the basket of startups that went public in 2020, 2021 vintage, and hope that there’s a Zoom in there? To me, it feels like a reasonable upside super mitigated downside type of way to index. Yes. I loved this idea when I saw it. This is the opposite where there are no question marks about what this idea was. I was like, good idea, interesting. Also, I was curious. I don’t know if you guys know, what are the mechanics of starting an index? Can I create an index? Do you need to be a certain person? Is there a certain bar? How does that work? Do you know?…

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