StoreDot having a valuation of $3.5 Billion sounds kind of crazy as they haven't sold anything yet, but it still sounds a bargain for what they could offer.
Specially Purpose Acquisition Company or SPAC for short is not a term I have come across before and stumbled on this when researching StoreDot today. Storedot if you remember is the Israeli start up company developing the quick charge batteries for electric vehicles. They are on target to demonstrate a 5 minute charge for an electric vehicle by the end of 2021.
I keep popping into their news feed to see if there is anything new regarding buying of shares as I believe this company is a no brainer for investment. They are the future and control the technology through the hundreds of patents they have in place. They are a disruptive technology based company that has developed something that is important to the mass adoption of electric vehicles. The key has always been the time to charge the battery and they have through their R & D with over 1000 scientists working full time solved this problem.
Where the research is now is not the quick charge, but increasing the range of the vehicles by developing the storage capacity of the battery. Currently they see themselves as having 6 x the range per minute charged against competitors and expect by 2028 others would have caught up to some extent, but they will still be double any other battery.
Up until now they have raised capital of $140 million through some key investors namely BP,Mercedes-Daimler,Samsung,Nissan and TDK. Wall Street doesn't sleep and StoreDot is in talks to merge with a Wall Street SPAC with a valuation of $3.5 Billion.
The benefits for a private company like StoreDot are huge as it gives them a way to offer an IPO and to take the company public being listed but also giving them the funds to grow at a quicker rate. This is like the final push accelerating what still could take a few years to complete.
StoreDot was talking about having a battery read for market by 2025 and with these funds would cut that time massively. The privately owned company would now become public but it also allows the owners to hold onto more shares this way in a structured deal.
SPAC deals do have time lines though being 24 months which is why an IPO may not be that appealing to many investors. Waiting 2 years for a company to start making profits is not ideal yet these companies are cherry picked because of what they can offer in ROI. Disruptive technology is where the money is and Wall Street is making sure it reaches their goal so they can make massive returns.
SPAC Deals Are Becoming More Popular
2014: $1.8 billion across 12 SPAC IPOs
2015: $3.9 billion across 20 SPAC IPOs
2016: $3.5 billion across 13 SPAC IPOs
2017: $10.1 billion across 34 SPAC IPOs
2018: $10.7 billion across 46 SPAC IPOs
2019: $13.6 billion across 59 SPAC IPOs
2020: $83.3 billion across 248 SPAC IPOs
This is a smart way of investing in something guaranteeing you are involved in that particular company as everyone is sniffing for bargain deals getting in early. TESLA would have definitely wanted this one for themselves as StoreDot are that much further down the road than anyone else in the battery industry.
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