SPAC (Special Purpose Acquisition Company)

A SPAC is a shell company—basically an empty corporate vehicle with no real business—created specifically to raise money from investors with the goal of acquiring an existing private company and taking it public. Think of it as a blank check: investors fund the SPAC, then its sponsors hunt for a target company to merge with. You'll encounter SPACs in financial news when they announce "de-SPAC" mergers. They matter because they're an alternative path for companies to go public faster than traditional IPOs, though they come with extra risks since you're betting on management's ability to find a good deal. For example, if Blank Check Corp raises $500 million and later merges with a promising tech startup, that startup suddenly becomes publicly traded.