Here we look at a comparison of SPAC versus traditional IPO route, and we've got a number of criteria for comparing them. Firstly, in terms of timing, SPACs happen quicker. They take between eight weeks to four months, whereas an IPO can be anywhere up to 24 months. In terms of cost, a SPAC initially looks cheaper. It's typically 2% underwriting, 3.5% deferred fee, however, the underlying cost to investors is higher due to dilution from sponsor shares and warrants. Basically, this means that investors have put most of the money in, but sponsors seem to be getting some shares and they're getting some warrants, and this is diluting the initial investors, and it means it's mostly their money that's been put in that's being used to pay these fees.

With an IPO, the cost is up to 7%, and that underlying cost to the company or selling shareholders can be higher due due to an IPO pop. Basically, if the share price goes up after the IPO, your fees go up too.

In terms of forecasts or numbers that are required for a SPAC or an IPO. With a SPAC, your present forecast can be for the next five to 10 years. This is ideal for startup companies that don't have past financials. However, with an IPO, you need past financials only, but you do need them. You need a track record.

Lastly, in terms of the risks with a SPAC, a time limit of two years is placed upon the SPAC by shareholders. They want their money invested. Shareholders also have a redemption option. They may decide they want to leave before the target company is acquired. You also do not know the target company. It could be pre-revenue, and thus the SPAC shareholders need to approve the merger before the acquisition actually happens. With an IPO, what's the risk here? The size of the IPO, i.e. how many shares are going to be sold and the share price of the IPO? Both of those are only determined post-marketing, so pre-marketing, there's a risk of trying to sell too many shares and that share price may end up being very low.