FinTech-related special purpose acquisition company (SPAC) activity got a bit of a rebound this past week — specifically, targeting banking services and products, where new announcements took the initial public offering (IPO)/SPAC announced plans in this segment to 47 year to date, as tracked by PYMNTS.
A deep dive this week into the strategies and mindset of one company, FinTech Aspiration, having announced a SPAC combination with Interprivate III Financial Partners Inc. and a $2.3 billion valuation, reveals that ESG can dovetail with finance, and technology, too.
As detailed in these digital pages, among other products and services, the company offers the Aspiration debit card, which allows people to build sustainability into their daily spending and saving.
“We’re making their debit cards and savings sustainable by ensuring that those deposits will never be lent to fossil fuels or oil and gas exploration pipelines,” Co-founder and Chief Executive Andrei Cherny told PYMNTS. “The Aspiration Impact Measurement allows people to see their own personal sustainability score as they’re spending on their Aspiration card.”
Among the other announcements:
TG Venture Acquisition, a SPAC that is focused on various technology verticals, FinTech, TMT and space technology, filed with the SEC to raise $100 million. In that filing, TG Venture said technologies under consideration for business combinations will include AI, blockchain and other advances.
The filing notes, “FinTech is disruptive to our life every day. The power dynamics in the payments industry are changing as consumers shift from cash and checks to digital payment methods and the COVID-19 Pandemic accelerated digitization. The payments industry demonstrated its adaptability, springing quickly to serve as a crisis response co-partner for individuals and businesses, assist in distributing government stimulus payments, and help customers, merchants, and corporate clients transact in contactless ways. Favorable trends such as the shift to contactless payments, the growing adoption of digital wallets, and the more widespread use of B2B payments automation are lifting the industry’s prospects.”
Elsewhere, Armada Acquisition, a SPAC that is focused on the FinTech industry, went public this past week, raising $150 million. The company said in its own filing with the SEC that it is looking to identify “businesses in the FinTech industry with an enterprise value of approximately $500 million to $1.0 billion, with particular emphasis on businesses that are providing digital, on-line, or mobile payment solutions, processing and gateway services, point-of-sale technology, consumer engagement platforms, and ecommerce or loyalty solutions.”
In an example of how other spheres of the payments industry are attracting interest — in this case, InsurTech and blockchain — SPAC Oxbridge Acquisition priced its $115 million IPO this past week, which includes the over-allotment option.
But Headwinds May Gather
But there are at least some signs that there could be headwinds on the horizon for SPAC-related activity. As noted in this space, a lawsuit has been filed against famed investor Bill Ackman’s Pershing Square Tontine Holdings (PSTH). The suit seems to hinge on just what PSTH actually is — whether it is indeed a special purpose acquisition company (SPAC), or an investment firm, and how the entity should be regulated. As CNBC reported, a Pershing Square spokesperson said the complaint bases its allegations in part “on the fact that PSTH owns or has owned U.S. Treasurys and money market funds that own U.S. Treasurys, as do all other SPACs while they are in the process of seeking an initial business combination.”
Questions and controversies surrounding regulations may, we contend, have a dampening effect on SPAC related listings and deal-making.