Explaining the hottest trend on Wall Street in 2020 : The Indicator from Planet Money Last year, more than half the firms that went public were special purpose acquisition companies, also known as SPACs. We explain what that means and how it impacts the world of finance.

The SPAC Is Back!

The SPAC Is Back!

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Johannes Eisele/AFP via Getty Images
TOPSHOT - Traders work after the opening bell at the New York Stock Exchange (NYSE), while logo for Pinterest Inc. is pictured on the screens during the company&#039;s IPO on April 18, 2019 in New York City. (Photo by Johannes EISELE / AFP) (Photo by JOHANNES EISELE/AFP via Getty Images)
Johannes Eisele/AFP via Getty Images

When fast-growing companies want to go public, they typically file for an initial public offering, also known as an IPO. IPOs can bring lots of cash to help companies supercharge their growth, but they are a lengthy process that involves examination, underwriting from banks and tons of paperwork.

But over the past few years, things have changed...

More and more firms are taking a different approach to going public — in the form of special purpose acquisition companies, also known as SPACs. Last year, over half of the companies that went public were SPACs.

Camila Domonoske from NPR's Business Desk joins the show to explain SPACs and what they mean for the world of finance.

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