Understanding the media company SPAC push

Sorry for all the SPAC coverage today, but a host of richly valued private companies that have an ocean of venture capital funds under their belt are going public. We have to pay attention.

Earlier today, TechCrunch covered the brand-new Better.com SPAC deal that will take the digital mortgage provider public. But it was hardly the only company working to combine with a blank-check company that demanded our attention today. There are a few media companies looking to do the same: Vice and the previously named Bustle.

It’s notable that we’re discussing SPAC deals for media companies at all because a few days ago, CNBC reported that such efforts had come into doubt, noting that the recent SPAC slowdown had led to “digital media companies [reassessing] their timeline on going public.”

Writing this to you as someone currently being spat out from a phone company into the hands of private equity, I was not terribly surprised that companies in my business were not enjoying the warmest of public receptions. After all, we’d seen some software companies delay their IPOs in recent weeks — though those efforts are now back on, largely — so to see the ever-less-attractive media concerns of the unicorn realm hold off on their offerings simply didn’t shock. Especially as SPAC stocks have taken a hammering.

And then, today.

Earlier this morning, Axios reported that Bustle, now BDG, still intends to pursue a SPAC-led public debut later this year. Per our friends over at Big Bullet Point, Bustle is not disputing reports that it is targeting a valuation of around $600 million. Sure, that’s the value of a single, late-stage fintech investing round, but for the media world, it’s not an exit to mock.

And yesterday, The Wall Street Journal reported that Vice Media Group is also moving ahead with a SPAC-led combination with 7GC & Co Holdings, a blank-check company that priced back in December 2020.

What’s going on? A few things, we reckon: The market is more risk-on than you’ve been led to believe; SPACs are still hunting for deals as their countdown timers tick; record asset prices more generally; and, finally, a booming advertising market coupled with rising belief in consumer-media subscriptions. For an industry that has been a reported venture-backed letdown in recent years — see this from 2020, this from 2019, 2018, and so on — it could be just about as good a moment as any to get out the door.

Let’s talk about it.

Taking media public

There are actually three media companies that could be going public via a SPAC, with Buzzfeed part of the crew alongside BDG and Vice, again per CNBC.

We’ll dig into each company’s known venture capital and revenue results shortly. But first, the market. Why are we still seeing media companies pursue SPAC-led debuts now? Here’s a breakdown of our market view:

,SPACs are desperate and asset prices are high as media recovers some and digital ad sales spike. SPAC now or forever hold your peace.