Get the latest market trends in your inbox

Stay on top of the latest market trends and economic insights with the Axios Markets newsletter. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Denver news in your inbox

Catch up on the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Des Moines news in your inbox

Catch up on the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Minneapolis-St. Paul news in your inbox

Catch up on the most important stories affecting your hometown with Axios Minneapolis-St. Paul

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tampa-St. Petersburg news in your inbox

Catch up on the most important stories affecting your hometown with Axios Tampa-St. Petersburg

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Mark Lennihan / AP

There's a new upcoming IPO on the docket. But in an unusual twist, it's from a pair of venture capital firms—Social Capital and Hedosophia—according to an SEC filing. It plans to trade on the New York Stock Exchange under the symbol "IPOA.U."

What it is: Social Capital Hedosophia Holdings Corp. is essentially a shell company that will go public and raise funds with the goal of acquiring or merging with a private company (which hasn't been selected yet). This transaction will allow the latter to skip over the arduous process of an IPO while also enjoying the benefits of being a publicly traded company. The company will also benefit from the capital injection of merging with this entity. Social Capital declined to comment.

  • It's what's known as a "blank check" company, meaning investors are betting on the team without knowing what they intend to buy. It's not super common, but not unheard of. More than a decade ago, three former Apple executives raised a bundle for a blank check company, but investors ended up losing most of their money.
  • Notably, the filing points out the growing number of "unicorns"—privates company valued at over $1 billion—relative to public companies of the same size (roughly150 to 200), suggesting the entity is likely to target a unicorn for its acquisition or merger.
  • Several venture capitalists have voiced concerns recently about the growing number of unicorns that are choosing to remain private for longer periods of time (which often means less liquidity for these investors than in previous eras).
  • We're already beginning to see some companies look into alternative routes, such as Spotify which is rumored to be considering a direct listing instead of an IPO.

Details: Social Capital Hedosophia Holdings Corp. will offer 50,000,000 units (or 57,500,000 units if the underwriters' over-allotment option is exercised in full), at $10 per unit, according to the document, raising between $500,000,000 and $575,000,000. Credit Suisse is the sole book-running manager for the IPO. The story has been updated with additional context and to correct Social Capital's firm name.

Go deeper

Tony Hsieh, longtime Zappos CEO, dies at 46

Tony Hsieh. Photo: FilmMagic/FilmMagic

Tony Hsieh, the longtime ex-chief executive of Zappos, died on Friday after being injured in a house fire, his lawyer told the Las Vegas Review-Journal. He was 46.

The big picture: Hsieh was known for his unique approach to management, and following the 2008 recession his ongoing investment and efforts to revitalize the downtown Las Vegas area.

Dan Primack, author of Pro Rata
5 hours ago - Economy & Business

The unicorn stampede is coming

Illustration: Annelise Capossela/Axios

Airbnb and DoorDash plan to go public in the next few weeks, capping off a very busy year for IPOs.

What's next: You ain't seen nothing yet.

18 hours ago - World

Maximum pressure campaign escalates with Fakhrizadeh killing

Photo: Fars News Agency via AP

The assassination of Mohsen Fakhrizadeh, the architect of Iran’s military nuclear program, is a new height in the maximum pressure campaign led by the Trump administration and the Netanyahu government against Iran.

Why it matters: It exceeds the capture of the Iranian nuclear archives by the Mossad, and the sabotage in the advanced centrifuge facility in Natanz.

Get Axios AM in your inbox

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!