Chamath Palihapitiya Leads PIPE Rounds For Latch, Sunlight Financial

Chamath Palihapitiya is a venture capitalist and investor that’s made a name for himself in the market for special-purpose acquisition…

Chamath Palihapitiya

Chamath Palihapitiya is a venture capitalist and investor that’s made a name for himself in the market for special-purpose acquisition companies (SPACs). He leads Social Capital Hedosophia, a venture that’s debuted six successive SPACs so far and raised a total of $3.7 billion.

Palihapitiya has been a prolific promoter of his own SPACs and has as well bet big on some debuted by others. He just continued his streak of bets by leading new private-investment-in-public equity (PIPE) deals for two companies that recently secured SPAC merger deals; Latch, a startup that makes smart locks, and Sunlight Financial, a company that provides loans to homeowners for solar installations.

On Monday, Latch and Sunlight Financial announced respective deals to go public through mergers with SPACs. Latch will merge with TS Innovation Acquisitions Corp (NASDAQ: TSIA), a SPAC sponsored by the real estate operator Tishman Speyer, while Sunlight will merge with Spartan Acquisition Corp. II (NYSE: SPRQ), a SPAC affiliated with the private equity firm Apollo Global Management.

As part of their respective deals, Latch will raise a private placement of $190 million that’ll be co-led by Chamath Palihapitiya while Sunlight Financial will raise a private placement of $250 million also co-led by Palihapitiya. For Latch, he’ll participate alongside investors like BlackRock and Fidelity and then with the likes of Coatue and also BlackRock for Sunlight Financial.

The deals co-led by Palihapitiya cements his stronghold in the market for SPACs, a stronghold that’s earned him the pet name of “Sultan of SPACs”. Before now, he had also participated in private rounds for other SPAC-merging candidates such as SoFi, the fintech company; MP Materials, a producer of rare earth materials; and Proterra, the electric vehicle company.

Palihapitiya himself has debuted six successive SPACs: IPOA all the way to IPOF in alphabetical order. With his SPACs, he’s taken Virgin Galactic (IPOA) and Opendoor (IPOB) public and secured another deal to take the health insurance startup Clover Health public with IPOC. His three other SPACs are yet to announce merger targets.

The two new SPAC deals backed by Palihapitiya are expected to be completed in the second quarter of 2021. 

Photo credit: jdlasica, licensed under CC BY 2.0

Leave a Reply

Your email address will not be published. Required fields are marked *