Fortress Value Acquisition Corporation - Social Capital

Type of Investment: Public Equity

Context

U.S. rare earths miner MP Materials to go public in $1.47 billion deal

Note

Below, you see that Chamath invested into a publicly listed company called Fortress Value Acquisition Corporation or $FVAC. However, $FVAC is not the rare earths mine seen above. $FVAC is a special purpose acquisition company (SPAC) which basically means it's a shell of a company who's purpose is to raise money via an IPO and then merge with or acquire an actual company. This sort of thing has been done for a while now.

The Memo

https://twitter.com/chamath/status/1285687433305169920?s=20

Key Takeaways

Pay attention to political news because changes in policy and international relations can quickly create and destroy opportunity.
Public equity investments are much heavier on the financial analysis, so it's important to build your sense of certain benchmarks (i.e. what's a good revenue multiple, what are good margins, etc.)
You need to be diligent in exploring different sectors and aggressively learning. Rare earth mining is so random, yet the current landscape created a perfect opportunity.
Porter's Five Forces is a great way to look at a highly fragmented and competitive market and find opportunity. Battery technology is very competitive, but their suppliers aren't.

Learnings: How to Write a Memo

highlight how they wrote the memo (format, order, story, structure, etc...)