Analysis

Family offices bet big on SPACs

, Bloomberg wealth

The SPAC boom has attracted financiers, former politicians, athletes and celebrities willing to use their fame to attract retail and institutional investment. About 600 blank-check companies have raised more than $182 billion since the beginning of 2020, according to data compiled by Bloomberg.

But family offices — the discrete, sometimes secretive firms that manage the affairs of the ultra-rich — have been one of the biggest driving forces.

While large family offices have long been investors in private equity and real estate, the recent flurry of SPAC bets show how they’re becoming a growing force in public markets. This comes at a time when some critics are pushing for more regulation of the investment firms following the implosion of Bill Hwang’s Archegos Capital Management, which has inflicted billions of dollars of losses from banks.

Family offices are largely exempt from registering with the U.S. Securities and Exchange Commission, but SPACs have to file with the regulator, providing insight into how billionaires are managing their money.

Family offices and firms linked to them have launched — or sponsored — at least a dozen SPACs that have raised about $4.5 billion in the past year with a further $1 billion in pending offerings, according to data compiled by Bloomberg.

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