Special purpose acquisition companies (SPACs) were once hailed for their opportunity to level the playing field, but the only thing they’ve leveled is the financials of retail investors. Their fervor was a blip in Wall Street history, but their losses are historic — and ongoing.

No Buffett: From 2020 to 2022, SPACs made up half of new Wall Street entrants. However, the trend has fizzled today, and its kingmakers are no more. Notably, Chamath Palihapitiya, known for kickstarting SPAC mania by taking Virgin GalacticSPCE

public in 2019, and other celebrity endorsements have faded. Last year, 40% of new SPACs failed to find a target, while at least 21 former SPAC targets went bankrupt, erasing over $46B in shareholder value.

• This year, only a handful of high-profile companies like nuclear power firm OkloOKLO
  and Lionsgate Studios ($LGF.B) have merged with SPACs.
• Halfway through the year, there have been just 15 SPAC initial public offerings (IPOs) — a far cry from the 248 and 613 in 2020 and 2021, respectively.

Where are the SPAC Success Stories?

While many SPACs have struggled to stay public, with companies like Virgin Galactic conducting a reverse split last month to remain compliant, some SPACs have outperformed the market. Among the few are companies like construction leader PrimorisPRIM

, data center firm VertivVRT

, and gambling giant DraftKingsDKNG

. And interestingly, a SPAC has emerged as one of the most active stocks this year:

• Donald Trump’s Trump MediaDJT
  , which merged with a SPAC in January, has seen its shares more than double this year since completing its merger.
• However, the Truth Social owner is down 45% from its all-time high — with its trading and valuation described by LinkedIn’s Reid Hoffman as “wildly high” and “absurdly out of the realm of normal.”

The comeback no one asked for: With the resurgence in memecoin trading and the popularity ofDJT

, analysts are speculating about a potential comeback for SPACs on Wall Street. Bloomberg reports that SPACs have raised $888M in the last three months — and even seasoned SPAC inestor Michael Klein has reentered the arena, alongside OpenAI’s Sam Altman toying with their potential. But buyers, beware, SPAC sponsors get paid regardless of whether you make money or not.