Growing numbers of young people are raising funds for SPAC deals in a challenge to financial vets. The trajectory of blank-check companies is shaping up to be a classic feeding frenzy—they've morphed in just a couple of years from a niche product aimed at pros into a mass-market phenomenon.
SPACs raise funds from investors to make an unspecified acquisition, though they’ll sometimes declare a theme such as health care, technology, or Asia. After a SPAC begins trading, its promoters scour the globe for a good company to buy. The two sides negotiate a deal and merge, effectively offering the target a shortcut to going public—and a rich reward for the SPAC’s founders.