For a while, blank-check firms were everywhere. In 2021, hundreds of SPACs flooded the market with a promise to reinvent how companies go public. That didn’t last long. Many of those deals either collapsed or traded well below their IPO prices, leaving retail investors frustrated and sponsors scrambling to save face. But despite the wipeout, SPACs haven’t disappeared. They’ve just changed — and maybe for the better.

What we’re seeing now in mid-2025 is a very different landscape. There’s no longer a rush to raise capital and no celebrity-packed investor decks. Instead, a handful of sponsors with strong operating backgrounds and tighter financial terms are still closing deals. And for certain businesses, this quieter version of the SPAC market might actually be a better fit than a traditional IPO.

From Excess to Restraint

When SPACs peaked in early 2021, they were valued more on story than substance. Pre-revenue electric vehicle companies and moonshot biotech firms used blank-check deals to go public without having to face the full scrutiny of institutional roadshows. That worked until it didn’t. Redemptions surged. Many stocks collapsed. The SEC stepped in.

By 2023, proposed rules added pressure to disclose clearer projections and more detail about sponsor incentives. The tone shifted. Some sponsors left the market entirely. Others adapted. The result is a smaller but more cautious pool of SPACs focused on cash-flowing businesses, government contracts, or infrastructure plays.

One recent example is a merger between a legacy industrial robotics firm and a SPAC backed by former aerospace executives. Unlike most high-concept 2021-era deals, this one involved a company with 15 years of audited revenue, military clients, and positive EBITDA. Not flashy — but not vaporware either.

The Structure Still Serves a Purpose

SPACs originally rose to popularity in the early 2000s as a workaround for smaller firms struggling to access public markets. The concept gained traction again after the 2008 financial crisis, when capital was hard to raise. Then came the explosion in 2020, accelerated by pandemic-driven liquidity and retail trading interest.

Even though that bubble burst, the original use case still stands. Some companies — especially those in tightly regulated or niche industries — benefit from the SPAC route. It can offer more deal control, faster execution, and flexibility around disclosures. If both the sponsor and the target are aligned on goals, it’s a viable option.

There’s no doubt the SPAC boom left damage. But the structure itself wasn’t the problem. It was the lack of discipline. Now that discipline is back, some investors are taking another look. They’re not expecting 500 percent returns. They’re looking for reasonable upside, clearer terms, and less speculation.

The hype phase of SPACs is over. But in their leaner, more realistic form, they may still be worth watching — especially when traditional IPO markets tighten again.