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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Report (as defined below), including, without limitation, statements under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, or the Exchange Act. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements include, but are not limited to, any statements relating to our ability to consummate any acquisition or other business combination and any other statements that are not statements of current or historical facts. These statements are based on management’s current expectations, but actual results may differ materially due to various factors, including, but not limited to:
The forward-looking statements contained in this Report are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Unless otherwise stated in this Report, or the context otherwise requires, references to:
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Overview
We are a blank check company incorporated as a Delaware corporation and formed for the purpose of effecting an initial business combination. While we may pursue an initial business combination target in any stage of its corporate evolution or in any industry or sector, we are focusing our search on companies in the TMT industries. Our management team has had significant success sourcing, acquiring, growing and monetizing these types of companies. We believe this experience makes us well suited to identify, source, negotiate and execute an initial business combination with the ultimate goal of pursuing attractive risk-adjusted returns for our shareholders.
Initial Public Offering
In November 2020, we consummated our initial public offering of 23,156,000 units (including our underwriters’ partial exercise of their over-allotment option with respect to 1,156,000 units). Each unit consists of one public share and one-half of one public warrant, with each public warrant entitling the holder thereof to purchase one share of Class A common stock for $11.50 per whole share. The units were sold at a price of $10.00 per unit, generating gross proceeds to the Company of $231,560,000.
Simultaneously with the closing of the initial public offering, we completed the private sale of an aggregate of 10,837,400 warrants (including 462,400 warrants sold in connection with the underwriters’ partial exercise of their over-allotment option) to our sponsor at a purchase price of $1.00 per private placement warrant, generating gross proceeds of $10,837,400.
A total of $236,191,200, comprised of the proceeds from the initial public offering (including the underwriters’ partial exercise of their over-allotment option) and proceeds of the sale of the private placement warrants was placed in the trust account at J.P. Morgan Chase Bank, N.A., maintained by Continental, acting as trustee.
Management Team
We believe our management team is well positioned to identify and evaluate businesses within the TMT industries that would benefit from being a public company and from access to our expertise. We believe we will achieve this mission by utilizing our team’s extensive experience in growing and operating companies within the TMT industries as well as our broad network of contacts in the TMT industries.
Business Strategy
Our acquisition strategy focuses broadly on the TMT industries with an emphasis on the cloud data storage and information security spaces. Both markets are experiencing substantive growth driven by the combination of increasing data sources and rapid adoption by society of the digital community enabled by this infrastructure.
Our management team has a unique combination of deal structuring experience to address the specific needs of our target market coupled with proven operating capabilities based upon its substantial technical expertise and deep understanding of the underlying technology path and business adoption cycle. The team, driven by these skills, has realized capital in various private companies that have exited via IPO and trade sale.
Our team has worked together for over 20 years across Silicon Valley, including roles as founders, technology executives and board directors, which has allowed our team to develop a pipeline of proprietary deal flow based upon our relationships with many C-Level executives / founders, former employees and associates, and deal partners across the leading venture capital and private equity groups.
We believe our management team’s experience and deal flow pipeline will allow us to create value for our stockholders over time.
The cloud computing market is expected to grow from approximately $371 billion in 2020 to over $832 billion by 2025, cloud storage is expected to grow from 33 zettabytes in 2018 to over 175 zettabytes in 2025 and the number of connected devices is expected to grow to over 55 billion by 2025. We believe these trends create an increased cyber risk, with an estimated over $5 trillion of risk over the next five years driving the demand for information security solutions.
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The initial focus of our acquisition search is concentrating on companies driven by these three macro themes combining security, cloud computing and cloud data storage. The market for cloud-based solutions is accelerating with Bessemer Venture Partners predicting a majority of the software market will be in the cloud by 2025 and nearly 100% by 2032. This trend has created several recent cloud-based winners including Zoom, DataDog and Snowflake. The Covid-19 effect is accelerating the movement to the cloud across a variety of industries.
We are targeting established companies with large and growing revenues and diversified customer bases that are selling well-developed and/or mature technologies and services into the new market segments that gave been created as part of the above technology trends, and/or are category leaders.
The selection process leverages our team’s relationships with experienced executive teams and VCs/ private sponsors, which we believe can be enhanced with our team’s business development assistance. Our management team has extensive relationships in the Stanford University and University of Michigan alumni networks and have a unique technical ability to assess market and product risk with substantial business development and operational skills to scale a business globally.
Our initial focus is on U.S. companies, but we are also considering European and Asian entities that have established a proven business model and can use capital to rapidly scale. We will utilize our team’s many years of experience and relationships to work with top venture firms looking to efficiently scale their winning portfolio companies and partner with private equity firms looking to build further business value in the technology industry.
We believe our management team has a competitive advantage as a result of its experience identifying emerging market disruptive leaders and leading global technology companies, with strengths in company operations, business and corporate development and mergers and acquisitions coupled with the application of technologies in Fortune 5000 enterprise accounts. This is coupled with our team’s substantial deal experience, where they have worked cooperatively with targets and companies to develop and execute financings on a primary and secondary basis, using different parts of the capital structure and financial structuring to support dividend recapitalizations and other corporate financing strategies to maximize the returns of stakeholders. Our deep technical domain expertise in both information security and cloud data storage allows us to capitalize and partner with management teams looking to build multi-billion dollar companies. Our combined experience including technical expertise enables us to offer public investors and target company stakeholders a differentiated approach to accelerating growth in key global markets by helping management enhance operational efficiency and scale. In the last decade, members of our management team have been investors and operators in multiple start-ups that completed an initial public offering. They have also been involved in seeding early-stage founders and helping raise the initial Series A funding while also running the companies to access the public markets through an initial public offering. In addition, they have executed secondary offerings and recapitalization strategies to serve the specific needs and goals of founders and early investors.