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More special purpose acquisition companies (SPACs) have been formed in 2020 than in the last several years combined. These entities have helped some high-profile unicorns go public recently, including DraftKings and Nikola Corp. PitchBook recently suggested, backed by several transactions involving electric vehicle companies, that SPACs may be well-suited to taking companies with relatively high product costs public. Here are five things for tech-based economic development practitioners to know about SPACs.

The venture capital (VC) market appears to be another part of the American economy experiencing a "K-shaped" recovery, with some participants achieving new highs as others are ignored altogether. The PitchBook-NVCA Venture Monitor Q3 2020 shows that the number of VC investments is on track to meet last year’s total (when estimated deals are included, as the report for the first time acknowledges the tendency to systematically miss more recent deals), while deal value is on track for the highest total ever recorded. Similarly, VC firms in total have raised more through Q3 2020 ($56.6 billion) than in all of 2019 ($54.9 billion).

"Finders," those who connect potential investors with issuers (e.g., startups seeking funding) within private markets, would not be required to register as brokers under recently proposed Securities and Exchange Commission (SEC) exemptions. Currently, individuals who work to connect investors and issuers — including simply providing issuers with a contact list and regardless of whether any advice is provided or whether the connection is made on behalf of one of the parties to any investment — may be required to register with the SEC as a broker.

A recent report by PitchBook indicates that angel investing is seeing fewer unique participants and a greater share of activity from groups than individuals. The same report provides an analysis of startup outcomes based on whether the company began with an angel or venture capital (VC) round and finds companies with angel backing initially look stronger but have a more mixed record over the long-term.

For the first time, individuals with defined measures of professional knowledge, will be allowed to participate in private capital markets without having to meet the traditionally required income or net worth levels. The U.S. Securities and Exchange Commission (SEC) has broadened the definition for who the commission views as an ‘accredited investor’ and a ‘qualified institutional buyer’. The amendments to the definition also expand and update the list of entities that may qualify to participate in certain private offerings to include tribal governments and other organizations.

The U.S. Securities and Exchange Commission (SEC) recently proposed rule changes that aim to make fundraising easier for new companies, including by expanding crowdfunding’s applicability and allowing for “demo day” communications. The changes target three particular methods of exemptions: Regulation A, Rule 504 of Regulation D, and Regulation Crowdfunding.

Concerns over national security have prompted the Treasury Department’s Committee on Foreign Investment in the U.S. (CFIUS) to force international investors to divest from two American tech startups, a move that will affect entrepreneurs and investors alike, according to a recent article by from Jeff Farrah of the National Venture Capital Association. Writing in TechCrunch, Farrah notes that historically CFIUS has targeted areas such as ports and real estate, but is beginning to focus its attention on how access to personal data can serve as a national security threat.

Based upon the finding of two reports – the 4Q Pitchbook-NVCA Venture Monitor and the MoneyTree Report –   SSTI identified three significant trends that impact the startup capital community: geographic concentration, mega-rounds/funds, and strong VC-backed exit activity.

Last week, U.S. trade representatives traveled to Beijing for a round of trade talks with the hope of coming to an agreement that would end the U.S.-Chinese trade dispute. Alongside large corporations, many U.S. tech startups are watching the results of these talks with a close eye because they face significant concerns over the impact that increased tariffs will have on their business. But while tariffs have garnered most of the press attention, U.S. startups also face reduced access to foreign capital, increased regulatory scrutiny, and potential talent issues. Conversely, China is developing new strategies to ensure that more investment dollars will remain in their domestic startup capital community.

Myriad data point to a decline in the number of new American business starts, but there have been fewer indicators of whether this overall trend was also true for firms with high growth potential. Recent research now provides evidence that these high growth firms are also becoming rarer. To the extent that high growth firms occur with less frequency, equity investors will have a harder time making successful investments that achieve positive returns — a reality that seems to be indicated by the several-year trend toward a lower rate of exits for venture capital funds.