YouSaid · the spoken record

Louis Camhi

lines on the record: 160
first: 2023-06-19
most recent: 2023-06-19
sittings or episodes: 1
sources: podcast

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“See magnetary, you see polar, like there's a lot of names in here, and a lot of the multi managers like Citadel and Millennium have teams doing it, but a lot of those larger firms, maybe their converts team will also do it. And so they have the flexibility to go back and forth. But look, when I'm invest in the SPAC last week, that's a $10 million spac, right? And I want to stay below 5% to avoid filing. And so that's $500,000. If you're one of these big boy funds like... You're not going to do that. And so there's some opportunity there. And so as the market kind of recalibrates this size, I think the opportunity set is interesting because there's just fewer people that can hunt there. But there is probably, I'm going to say this 50 SPAC dedicated funds out there. That's just my guess.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Not particularly, you know, it's funny, I was mentioning this to a broker recently. So when I was covering financials and fintech, there would be every two weeks, some firm would bring out their analysts and host a dinner and everyone would trade ideas. And it's just not life that an arbitrage. But at the same time, when you pull up a holders list and you see kind of the same name, you see Hudson Bay, you see Saba, you see Atalanta. Oh, yeah.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Right, and so I actually think politicians are better off talking about cannabis than actually doing anything. I hope I'm wrong. I want to see them do something, but it just feels like if you actually get the laws changed, the impact may, you know, again, if you're thinking the impact on a national level is probably not going to be as great as if you could get that emotional rally over changing cannabis and fixing something that's silly.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“To be a $30 billion market by the end of 2030. A $30 billion market only matters to the people in the market, right? You think about GDP, you think about retail sales, like we're talking trillions of dollars.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“That I don't know, but I can tell you because I went through the exercise when the First Republic started having its issues before the JPM takeover, I was reaching out to people to see where I could potentially move my business. And I got five or seven names. And I know that there's a much longer list of banks going to bank cannabis. But the big issue is 280. So if you're a dispensary, you pay taxes on your revenue, income taxes. You don't get kind of standard expense deductions that any business would. And so you're really kind of straining cash. And a lot of these companies have deferred their taxes, but at some point you have to deal with that. And just listen, legalization is good. More states coming online is good, but the government has been helping. And I think one of the challenges for the industry is that cannabis is, you know, if you look at kind of sell side forecasts, it's estimated.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“So there's a lot going on. So, for the dispensaries, one, you've just seen macro weakness, just broad macro, right? So that's obviously bad. Two, you've seen pressure on actual cannabis, whether it's regulation, whether it's the price of plants. So I joke around that I have exposure to the one industry that's been deflationary, even as inflation has been ripping, but such as life. And then you have an industry that's been really reliant on private capital markets. And as we know from this conversation, that market's been really challenged to, you know, people talk a lot about safe banking. And look, I hope safe passes if people think it'll help dispensaries. What I tell people, and this is true, and unfortunately I have to sit in both of these, there's more banks willing to bank cannabis than willing to bank hedge funds, which I don't think people truly”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Without looking at it, I'm sure not great because cannabis, you know, as you may know, I'm on the board of a cannabis payments company and the entire sector has been kind of slaughtered. Okay.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, are there any banks or bank-like companies? I guess it's kind of either or, but that have SPAC'd or have plans to be spacked? Not as a sponsor, but literally Zion Bank was a private company that merged, did a reverse merger with a spack.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Doubt about that, especially now. I mean, we had like 700 spacks at one point, and that number has come way down. When we spoke last, there were over 500 spacks looking for targets, and now we're under 200. So we're definitely.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Feeling. I know that there's limits on deposits and whatnot, but it just feels like the setup isn't there. And I saw some data that showed we have in the United States more banks per capita than like anywhere else in the world. And so you kind of have this question of do we need all these banks? And if these banks were to consolidate, is that a good thing or a bad thing? I just have a lot more questions than answers.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I just for banks, I don't see what the structural trends are. But I think banks, regional banks, especially are trading stocks. It's easier to say the big banks are just consolidating shared because hedge funds, right, there's not so many banking choices. And I was banking with First Republic when all this went down. And I sat there saying like, okay, even after everything was guaranteed, you know, there's business interruption risks. Like, why don't I just move to some of the bigger banks, right? And I think a lot of small businesses probably have that.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Well, why? We have to go through the why, but as you know, if you buy a stock because it's cheap, it's not necessarily going to go up, right? In my world, I used to cover the asset managers and Franklin Templeton was always the cheapest one. And it hasn't moved. So if I'm looking at the chart right now, Franklin Templeton on June 30, 2010 was 2873. And today it's 27. So again, it's paid out dividends. I'm ignoring dividends. I realize that. But if you just bought this because it's cheap, then you've sat there for 13 years and haven't made money. But if you bought Blackstone, which at times people thought was expensive, but had, you know, the right structural trends, you know, even Now that it sold off a lot from the peak, if you were to go back to, let's just say, the end of 2018, I mean, the stocks tripled.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“You don't get attracted by price a book, you do some price book with the trust relative thing. I mean, a bank stock trades at 20% of price to book. That doesn't interest you because the book's made up”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“And so that's just always been my issue. And then if you look at, well, banks really make money off of credit and now the private equity guys are taking over private credit because of some of the other regulations on banks. And it's hard.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“But we were at $44 in 2015. So sure, I'm ignoring dividends in this analysis, but we've basically been sitting flat for eight years. Like that's just. That's terrible, right? And so sure, like if you bought bags and I'm looking at the chart, you kind of have to buy bags at the bottom, you know, at the trough of 2020 to have really made money, or you have to trade them all, right? Like banks were trading, the KRE was trading 60, 70 bucks. And so sure, you trade them around. But if you're thinking about regional banks as a whole, I just think it's so difficult to say I'm just going to own banks because I just, again, for me, and maybe I'm just not smart enough, I don't know what the right environment is for banks to work. And in that environment, whatever you come up with, is there something that works better?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Rates start going up, and you have deposit beta concerns, right? Just mentioned how much you have to pay your savings accounts holders relative to what you're making. So now you're concerned and rates move up and then something breaks. And then the regulators come in and they say, well, now we need to regulate. And so when do you make money? So if you look at a chart right now of the KRE, the regional bank index, we're at $45. I mean.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Well, so I want to clarify one thing, which is yes, bacch yels have narrowed, but remember, all spac are kind of the same, right? There's nuances in caymen versus Delaware, but if I can find a spec that's yielding 8% versus the other speculating five, it's not like I'm taking credit risk, right? And so, you know, while yes, the numbers I quoted you for the SPAC universe have tightened, I still think there's plenty of opportunity. You just have to be an active participant versus buying the index, which I don't even think there's an index to buy. Go on to your question on regional banks. So I was never a bank analyst, full disclosure, but I just always felt that banks are really hard investments. They're trading stocks. And the reason I say that is, you know, if you think about where we've gone from macro standpoint, you had low rates where everyone was worried about, oh, banks are never going to make money.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Right, but it sounds like Spax may continue to be just bonds to you for a good while for now based on what you're saying. So, Lewis, my final question is you said the SPAC spreads are narrowing. The spreads between your financing costs to borrow and lever up the trade versus how much the SPACs are yielding. You are in good company. Banks, their spread has narrowed considerably, particularly the small banks where their deposit costs used to be zero. Now they're 3%. They can make loans at 7%, but it's very hard to make them. So, you know, they sometimes make loans at 6%. So their net interest margins have narrowed. And a lot of bank stocks are in trouble. You just have to look at the chart. I don't know if you were bank analyst, but you used to be a payments analyst. So kind of related. What is your outlook on, let's just say, you know, regional banks? How much attention are you paying to those?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“So, listen, it's much more fun to be in bubble times, but I'm also just a cautious person. Maybe that's why I do spec arbitrage. And I'm highly focused on the downside. But I would definitely, I think the economic data right now is not so great. And I would love to see that improve a bit. And, you know, you talk about AI and people talk about the S&P, which is, you know, Apple and Microsoft. But you look at the Russell, you look at some other places, you look at commodities, you know, they are telling a different story. So I'm going to continue to be cautious and listen nothing would make me happier than one of the specs I own to run up to 15, 20 bucks before the deal closes and create that opportunity like we saw a couple years back.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, for me, I've never had more fun. I was doing well financially. My friends are doing well financially. It was the only time in my life I wasn't afraid to give a stock tip because I always say if you make someone a dollar and then lose them a penny, you feel miserable.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Right, and listen, let's go back to the dot com boom. And I was pretty young for this, but I think we can all agree that the internet's real and it's here to stay, but minus Amazon and Microsoft, like how many of the companies from back then are still here. So I think it's great. I think whatever comes from. Market bull run is going to be good for society. But when I just look at the core macro data, when you look at what Costco is saying, what you look at dollar general or dollar general is saying the commentary is pretty bad. And listen, I don't wish your recession because that has real consequences on real people, but it's hard for me to get overly excited right now. And I'd love to. Listen, life is more fun when you're bullish.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I don't think so. Disclaimer, I am not the biggest macro guy. I'm not an economist. Just from a more common sense perspective, we went from zero rates to 500 basis points. And I think that takes time to flow through the system. And at the Morgan Stanley Financials Conference was yesterday and the bank commentary candidly wasn't very good. You know, I think given everything happened with First Republic and Civ B, if banks pull back on lending that has real economic consequences. And so I think the AI stuff is really interesting. I think that we tend to get ahead of ourselves no different than Eevee, no different from.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“It's not worth your time, right? Like when I was at Citadel, we didn't even look at small cap stocks, right? It was even mid-cap stocks were tough. Like I was focused on just large caps because you needed that liquidity. And so it kind of creates a nice niche size for guys like me and maybe even a little bigger to look at some of the stuff and take advantage because you can't be too big. You can't be too small. Definitely some interesting stuff on the back end with the pipes and whatnot, which, you know, if you want to chat about, I'm happy to, but that's a whole separate topic. But there's, you know, for me, my goal has been broadly to be a capital provider to SPAX at kind of all stages in their life, but also being mindful of the cycle. Because if you get the cycle wrong, you can get yourself into a lot of trouble.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“When you look at all the nuance, you have to either, there's kind of the sweet spot. If you're doing it as an individual and you're putting, even, say, $10,000 to work, right? And you're playing for 1% of alpha, that's 100 bucks. It's probably not worth your time to sit there and read all the filings. If you are a multi-billion dollar fund, you probably can't put enough money to work in some of this stuff.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Come in, and now I'm getting half a cent a month. And so there's some of those where you're trying to like game it and look at how it's been trading and whatnot, but there's been a couple of opportunities like that where we've been able to find extra yield.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Means that a sponsor says we want to extend the life of our vehicle and we are going to make a financial contribution to do it. That financial contribution will be the lower of $200,000 a month and four cents. And so you may look at that. So I'll look at something like that and I'll say, okay. Four cents times 12 48 cents just under 5%. So if I'm getting that full monthly, I'm getting just under 5%, plus you're still invested. Let's pretend you came in and you're earning 5% no taxes. So now I'm just under 10%. That's a home run. If I can own something like that, right, we got risk-free paper, 10% is hard to come by. And so you look at some of those, but the flip side is if everyone has that view, and now everyone stays in that cap of $200,000 a month”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Of interest on that 80% and allocating it to the 10, you could see a big step up in trust. Another thing we're seeing right now is these game theory extensions because nothing should be easy.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“So, you know, again, that's definitely not the majority, but that's in the sample size. And so it's required by people in my shoes to try to find the better opportunities and the better opportunities could be because we're reading all the filings and seeing that example where all of a sudden the SPAC is investing in an interest-bearing account before they weren't. Or maybe there's an issue where the trust value ends up being a bit different than people estimated. And so what we've seen a couple of cases where there was a redemption event. And between the time where the meeting was held for redemption and the payout, let's say it's 10 days, there was the interest earned there. It's unclear who gets that interest. And in a few instances, that interest was ascribed to the remaining trust. So you can kind of do the math on how if 80% of your trust redeems, but I'm getting 10 days.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Exactly. That's a cretive to yield. And so then we kind of saw all of you think that just basic supply and demand, we saw a lot of supply just fall out of this market with liquidations. And so as a result, you've seen kind of tighter yields. I would say, you know, we're probably 100 points wider at the max. So we're still at six. Financing rates are still at five and change, but like everything else, right? Embedded in the six, you've got a lot of specs of negative yield, right? Spacs like again, picking on Donald Trump's back, DWAC, you know, DWAC trading at over 12 bucks with under $11 in trust.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, no, it's true. So for me, one of the things I look at the most are here's what SPAC yields are and here's what my financing cost is, right? Because as those numbers widen out, that's really great for me. And as those narrow, then it's not so great. And so we saw, going back to what we were talking about earlier, we saw kind of these accelerated liquidations happening in Q4. And that really was very fruitful. We saw, because if you think about it, if you have a spec. that's trading below trust and now you fast forward the redemption deadline that's a pretty payment”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Current interest, not modeling any increases or cuts. So x will be the value of the warrant, I'm going to make 5.8% a year. Like that's my start. And now if Aries is, I think, a special tier one and they have a, I'm a deal right now in market where they've announced it. It hasn't closed yet and it's trading at, I want to say it's 70 cents. Yep, it's trading at 70 cents. If I come back and say, like, okay, I think I'm going to get, I think this will trade at 70 cents too. So half a warrant is three and a half. So now I'm getting something like if they take the full duration of time, I'm getting something like a 7% return. Like that to me with no risk in this environment is pretty excellent.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Trust value, right? So let's go back to Aries. So at Aries, the IPO is $10 and there was $10, $10 in trust. And I mentioned that my forecast for the terminal value, if you will, of where Ares is going to be in 10 months was $11.11.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Well, it's not that, right? It's that in the example I just gave you, five of the six percentage points of your return came from the warrant. And so, how do you make sure the warrant has value? You have to have confidence that they do a deal and do a good deal that's well received. Now, the yields are closer to 6%, but what's really interesting is that 6% without the warrant, right? Because now money market rates are five. So you're getting something like 5% from the money market rates and 1% from that trust accretion. And then there's some of these where sponsors make contributions also. We'll table that for now. But what's really interesting now is you're getting, if you can get into an IPO at”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Right. And if you think about it, if that's your strategy, the sponsor quality actually matters, right? Because you need the sponsor that's going to get the deal done. Otherwise, you're going to have a lot of ones instead of a lot of sixes. And so back then, I would go through like, who's the underwriter? Who's the sponsor? What have they done before? A lot of work trying to understand the industries, what makes sense. And it's funny because none of that matters anymore, right?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, if everything goes wrong, we make 1%. If they do a deal at the time, the average warrant for a closed deal was a dollar. I mentioned earlier that it was like, what do we say 50 cents now, but it was a dollar. And so you would say that that half of a warrant is ever worth 50 cents. So now I have a 6% all-in return, right? 1% from the trust accretion and then 5% from the warrant. My financing cost was super low at the time. you know i didn't remember what it was to be to be candid Closest year, I mean, most back funds are overnight rates plus. So let's just say it was 2%, right? So I would say that my target is to make 6% and worst case make one and finance at two. And so if”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I mean, listen, they were, you know, a lot of them were in the 2-3% rate. And so when I used to underwrite SPACs, I wouldn't even talk about the interest income. I would talk about, look, if we're going to try to buy these units at 990, let's just assume a unit came with half a warrant. To buy these units at 990, and one year we're going to redeem for 10. That's 1%.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Not really happening, and so it's just more about the yield. So I joke around, I become like a glorified fixed income trader. It's a little boring on some days, but you have to trade the market you have and not the market you want.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Too much love in the market, but for me, broadly speaking, I start off with the yield, right? If I buy your stock, The yield because if I can make enough money on the yield, I don't need the upside optionality. I love it, don't get me wrong, like who wouldn't? But for me, if I'm choosing between KKR and I'm yielding 4%, which by the way is below financing cost, or a sponsor that, you know, is doing the China biotech that I don't think we will receive, but it's yielding eight, I'm going to own the latter all day because that's still a risk-free return to me. And so that's, again, this is a really interesting conversation because I think it changes depending on where we are in the cycle. If we're in an environment where a deal getting announced could send the warrants to two bucks, sure, like now let's talk about that because in that environment, you probably want to diversify a portfolio of here's the yield only, but here's a little more kind of speculative growth with downside protection. And it really becomes a more interesting portfolio construction discussion. Whereas right now, that's.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“A lot of these sponsors in their prospectus, they'll say this is where we're going to focus on a deal to do this. And it's not binding or anything, but you have to read that and say, like, I think investors would get comfortable owning that exposure. And I just, if you came out here now and said, we want to do a Chinese biotech deal, like that could be cool. And you may actually be able to find a really interesting opportunity. I just don't see investors getting comfortable with that today. Like that could change in three months. And so it's hard to say, all right, so I look at that and say there's probably no chance that you trade above trust. Your warrant's probably get really little value. So I don't know, right? That's just harder. There are certain, you know, so when I look at that, when I look at certain teams and similar thing, right? Like if you're launching and your team is kind of all over the place and you're a generalist, like, again, thus far, that hasn't gotten.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Future, perhaps. Like, for example, if the CEO Declared by China as a financial criminal, and he's not allowed to for Chinese banks to lend to him. And yet he takes a plane ride to America and he suddenly has a spack. If a sponsor does a deal with him, maybe that raises some questions. That's what you're saying.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I mean, again, it's. It's hard for me to get comfortable with some of the ones that are doing China deals just because I want to be careful that that comma's not taken out of context.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“That over time you want to bet with, but if it's a sample size of one, you know that there's risk that they liquidate. Whereas there could be some guys that maybe they shouldn't have a spac, maybe they can't afford to lose the risk capital, they will force something done, but it could be one of these deals that goes to a dollar kind of as soon as it closes. And it's hard to kind of, even if you're playing something like the Warrens, which in theory is just upside if you bought the unit, it's hard to see how you're going to make a lot of money. So again, I would say the big things are, you know, how do you source a deal and how do you find it to deal?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Back out there. It's called by a middle market private equity firm that focuses on financials called Corsair. And I happen to know those guys have a lot of respect for those guys. I believe if they do a deal, it'll be a good deal. And if they can't find a deal that will really work for the market, then they're not going to force one through. So it's kind of interesting when you think about it's the guys that can afford to lose the risk capital.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Right, and so look, I was surprised. And if you own their warrants, you were pissed off because you were zeroed and you probably thought like I'm betting with KKR. That's great. But I think it's guys like that that are able to be a little more thoughtful. You know, if KKR comes back and announces a deal, you're going to remember this deal's probably okay because there are sophisticated investors and they chose to kind of forego the last one. You know, I think Aries is out there just raise a second vehicle. And so I think it's these, again, my view is, do you have access to your own deal flow and do you have access to capital? And so it's understanding that. And we know the big names, right? We know the gores. We know the Aries. We know the Churchills, but it could also be a $2 billion middle market fund that for a living, they look for deals and they have LP money. And again, that doesn't mean they'll do a deal, you know, but like there's.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I still think Gores, for instance, has been just really active in this space and probably someone you want to bet with. And if you think about your top private equity firms, like, let's talk about KKR. KKR liquidated their vehicle, right? And yet, if they brought another one, I think that would be pretty interesting because by liquidating their vehicle, they chose to lose their risk capital at the cost of protecting their reputation. And I think...”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“That's a good point. So, who would you say are sponsors who you have the most respect for? Whether a blue chip name and when their name is attached to something, it means something to you. And then who are people who maybe their reputation has fallen a little bit?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“If you own something and it doubles, you buy chips off the table. Point being, if you kind of, you have to improve the merits of the product. And so I think alignment is pretty important.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“I just think conceptually you want alignment. When people complain about SPACs, they bring examples like Chamuth did his spac deal and traded up to $20. And he sold and moved on to the next one. Now, in fair one.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Well, I'll state it a little differently because you got me there. What is the value creation playbook, and how does the SPAC help pursue that initiative? Because if you were, there's a price for financial capital and there's a price for strategic capital, right? Like we see consultants getting paid all the time. We see bankers help raise money all the time. And so if you want to get your true sponsor economics, I think you need to do both or you need to rethink the economics. If the answer is from a sponsor is going to be like, listen, I know nothing about your business. I don't want to be involved, but you seem to be a smart guy. I like what you're doing. So, you know, I'll merge with you. I think the response to them is going to be like, okay, well, I'm going to tie how many of your founders you keep, how much money stays in the trust.”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT
“Got it. Okay. And so Lewis, that theory of, oh, I have all this experience. I'm going to help you out. That can work, and I'm not saying it doesn't, but like, let's say when someone goes on Shark Tank and they have a certain business and, you know, Kevin O'Leary says, oh, I can help you because I have all this experience. Oftentimes he's right, but it's because he has this huge brand and he can post about it on Twitter and put people in touch with people. But it's not like Kevin O'Leary knows more about the business than the founder of the business, you know. And it's The same with its back. Like Blackstone can put, you know, if I have a company, they can put me in touch with people and maybe they have more experience Know, I mean, the 24 year old analysts who are hired by Blackstone to do all the work, what do they know?”
2023-06-19 · Forward Guidance · SPACs Are Bonds, Actually | Louis Camhi · IDENTIFIED FROM THE TRANSCRIPT