Former President Trump has envisioned his own firm’s media wing-right to take itself public in the next year through a deal with a SPAC that could value the company at over $2 billion, aiming to attract a strong following among conservative Americans with the fast-growing social media business, Rumble.
The company hopes to complete the process by the second quarter of next year. In a statement announcing the transaction on Wednesday evening, the company said that the deal would result in Rumble leaving with $300 million in cash. Rumble intends to merge with Cantor Fitzgerald, an investment company initially created by Wall Street Bank decades ago, in order to go public.
The publicly traded investment vehicle, Fitzgerald Cantor The, saw its ticker CFVI rise by nearly $12 to %25 on Thursday.
Conservatives, who claim they unjustly restrict speech, have escalated their scrutiny of established social media platforms such as Facebook and Twitter in the past couple of years. This comes as Rumble, established in 2013, has gained popularity among Republicans. Rumble presents itself as an authentic and impartial platform.
Chris Pavlovski, the CEO and founder of Rumble, expressed in a statement that their platform is built to serve as a robust and autonomous foundation that is resistant to the effects of cancel culture. He emphasized that Rumble is a community that fosters and encourages creativity without suppressing, censoring, or penalizing it. Moreover, he highlighted the importance of providing a neutral network that offers a wide range of ideas and opinions, as he believes it benefits everyone.
Rumble, a platform that attracts nearly 40 million users, highlights figures such as Trump, Glenn Greenwald, Devin Nunes (R-Calif.), And Dan Bongino in its investor prospectus. Fueling the platform are conservative media personalities who have made a home for themselves. Following Trump’s loss in the 2020 presidential election, his popularity on Rumble exploded, with monthly users rising to over 20 million at the end of last year and around 2 million additional monthly users.
Rumble and Trump, alongside Gab, Telegram, and a rebranded Parler, have also congregated towards right-wing users. Presenting conservatives with an alternative space from conventional social media, the ex-president intends to establish a social media application named Truth Social, which shares a striking resemblance to Rumble’s business model. It is ironic that the former president’s prominence on Rumble is now being emphasized, as he positions himself as a competitor to the platform.
They can rally direct support from their investors, users, and fans, enabling an easier opening path to the public markets. They allow two routes that may be unavailable for openly partisan businesses to circumvent traditional financing routes. SPACs are an obvious lure for him and Rumble. Taking advantage of this fad around blank-check companies, Trump also wants to use a SPAC to generate attention and cash for Social Truth.
Why have Conservative sites occasionally been booted from Amazon, while others find the same lucrative business niche of publishing controversial content without caring about selling the thing? Instead of outlining a broad dream of competing with every media company from Facebook to Disney, Trump offered scant projections in his SPAC prospectus, outlining the prospect of building his own arm of Web-services to compete with Amazon. Those shareholders who traditionally have been driven by what has traditionally motivated interest in a stock – concrete financial figures and projections for the future – aren’t motivated by what Trump has offered. They have already watched its shares swing madly, falling back to little below $50 from as much as $100 since it publicly traded as a SPAC in late October, with plans to link him up with investment vehicle.
Similar to Amazon’s, Rumble also intends to establish a Web-hosting venture. Additionally, Rumble can highlight a rapid, recent surge in users and some significant indicators of user involvement. As per the Rumble prospectus, users viewed 8 billion minutes of video in the third quarter, reflecting a 3,900% surge compared to a year ago. However, Rumble does possess an existing business that is eight years old, although its prospectus does not provide any insights regarding fundamental measures of corporate success such as revenue or profit. Unlike Trump’s company, which is yet to release even a beta-version app, Rumble has more favorable aspects to attract potential investors.
The share prices for Trump and Rumble appear to be driven by manic investor sentiment and fluctuating prices, with securities becoming meme stocks. In reality, tangible business proposals are not a priority.
Is the Trump-branded social media company currently worth $2 billion in the market? Have they seen an increase in the worth of their shares this morning? The underlying financials don’t fully support either side. Instead of investing in the stock based on a social statement, it seems like they are more interested in wagering on future profits or cash flows. Remember, Trump’s business hasn’t publicly detailed its income or cash position, so it’s unclear.
Many others lost a lot of money when they joined too, but a few people who joined this club and traded GameStop shares did well. You wanted to flip the bird at traditional existing investors who had battered the stock, and it was a comment that you, a young online investor, made when you started buying GameStop shares at the beginning of this year’s meme stock mania.
GameStop’s investment in buying video games from a store mall was only partially about betting on the future, as it also reflects the company’s financing of media operations. However, at this time, Big Tech is the main focus, with shares representing a like-minded viewpoint belonging to the online community of Trump or Rumble Buying.