Luminar Technologies, which produces sensor technology for self-driving cars, started trading publicly Thursday and made its 25-year-old founder and CEO Austin Russell a billionaire.
Luminar is the latest in the long list of companies that have had an IPO in 2020 after getting acquired by a special-purpose acquisition company, or SPAC.
The company’s current market value is around $7.8 billion despite being an unprofitable company: Lumniar lost $97.4 million in 2019, following a loss of $79.6 the year before.
Today CBS had an event in which Gregg Nabhan, Global Vice-Chairman of Bank of America Securities talked a little about his view of SPACs.
Gregg believes that even though SPACs have been around for decades and can be very useful, in 2020 people might have overdone it. Why? Well, when you are under the pressure to buy something (as these SPACs are), there is a high chance of making a mistake and with so many SPACs popping up here and there, it won’t be a surprise if some of them go under.