Here’s why this real estate disruptor chose an after-sales service to go public

The SPAC boom we saw in late 2020 and early 2021 may have calmed down a bit, but some high-potential companies are still taking the SPAC route to go public. A particularly interesting example is the real estate offer “iBuyer”, which is about to merge with the blank check company. Acquisition of Supernova partners (NYSE: SPNV). In this fool live Video clip, registered on 23 august, Fool.com contributor Matt Frankel, CFP, sits down with Offerpad CEO Brian Bair to find out why his company has chosen this path.

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Matt Frankel: I want to talk briefly about your going public soon. You’re not officially public yet, although you do trade a bit as a public company for those familiar with the PSPC model. Why did Offerpad use this background instead of a traditional IPO? You are not the first iBuyer to do so. This is apparently an enticing process and why Supernova in particular.

Brian Bair: I know it was. During this time especially when the stock market was extremely competitive and many different PSPC companies wanted to sponsor us to help get us public. We looked at everything, we looked at staying private, we looked at going public in the traditional way, and we looked at the PSPC process. For me the most important thing was, what is the direction on the business and our way forward? Because what we are doing and changing the way people view real estate is not a quick game. There is a lot of education and a lot of market share that people can get. But the only thing about the PSPC process was that it is a much faster route. There is not as much as following the traditional route or especially staying private. What we wanted to do is basically get the car to the sea in the most efficient and quick way possible, so that we can focus on keeping the business running. We had our sponsor SPAC, which was Supernova, led by Spencer Rascoff and the band there. It was a perfect sponsor for us because one, they were operators, they understood the industry as a whole, they understood the space as a whole, but also the hyper growth. We not only want to research our sponsor SPAC, up to going public, but also, in addition to what we can learn from the sponsor SPAC to improve Offerpad. They really tick all the boxes to that end and they’ve been great partners.

Frankel: Cash is obviously another advantage of going public through the PSPC channel. Typically, companies raise more money through the SPAC IPO than they would during a traditional IPO in many cases. You get around $ 650 million just to prove it. How do you plan to implement this? Are you going to use it to speed up the purchase of your home? To develop your technology? Or how do you plan to implement this?

Bair: Yeah, that’s a bit of everything. We’re looking at it in phases, one is that we’re hyper-growing right now. At present, we have announced 21 markets across the country. We are in 1,500 towns and villages what we have announced. We just announced more than four markets, seven markets this year will continue to expand that. There is some market growth, but there is also additional market penetration to increase our buying box of the homes we’re in and the homes you buy in our current markets. But there is also going to be a significant investment in our product and our technology. I’ve hinted at this before, but how Offerpad is going to win depends on which products you allow the consumer to use. It’s completely different from what they can get, I would say the more traditional market. We can talk for an hour about all the other products that we’re going to be announcing, but that’s something we’re excited about because more importantly the consumer wins and there will be a huge benefit for Offerpad as well.

Matthew Frankel, CFP has no position in the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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