Business Overview and Segments
Spike Acquisition Corp is a shell-company called a Special Purpose Acquisition Company (SPAC). Traditionally, a company would go public through an Initial Public Offering (IPO), but nowadays companies are preferring to merge with these SPACs, as there are less fees involved, and the company has more of a say in it’s valuation. Spike Acquisition has agreed to merge with WeedMaps, which is an online marketplace that connects marijuana producers with customers. WeedMaps runs the online platform, advertises, recruits customers, processes payments, ensures the strict regulations are adhered to, and provides a host of other services to the marijuana producers, and in return, they take a cut of all the transactions done on their platform. This is a win-win as the marijuana producers get the services they need for much cheaper than if they were to do it all themselves, whilst also getting access to the largest online marijuana customer base in the US, and for WeedMaps, they simply build the software once and replicate it across all their producers for relatively little incremental cost to them.
Network Effects – buyers on the platform will attract more sellers who want the largest potential customer base, and this in turn will attract more buyers who want the largest selection variety, and so on.
Key Facts and Figures
| Risk of Bankruptcy | Low |
| Last Year’s Growth | 43% (High) |
| ROIC (Company Quality) | NA |
| Free Cash Flow Margin (Company Strength) | 20% (Very High) |