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Who will Bill Ackman’s blank check company buy?

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What will the biggest ever blank-check company acquire? 

That’ll be a topic of endless fascination in coming months after hedge funder Bill Ackman raised the largest ever blank-check company on Tuesday, with $4 billion in capital for Pershing Square Tontine Holdings. It began trading on the New York Stock Exchange on Wednesday. 

A quick refresher: So-called blank-check companies, or Special Purpose Acquisition Companies, are effectively holding companies that find a business over the course of two years or so and take it public via merger. Rather than betting on the financials of a company itself, investors are, in a way, betting that the founders of the SPAC have the investing acumen to identify an attractive target.

More importantly in this case, the amount that blank-check companies raise is a fraction of the full value of the company they take public—a major reason to keep track of the tontine. At $4 billion, there are only so many possible acquirees.

So who will the tontine buy? In a Bloomberg TV interview Wednesday, Ackman gave some hints. He said the company’s target universe likely includes about 150 private companies valued at over $10 billion, with the top third clearing his quality threshold. He ruled out so-called pure technology companies that are speculative, a category in which he puts Alphabet’s self-driving car unit, Waymo.

“Basically, we’re in a unicorn mating dance and we want to marry a very attractive unicorn on the other side that meets our characteristics,” he told Bloomberg TV. While the company does not have to be currently profitable, he says, “We’re looking for a simple, predictable free cash flow-generative company, very high barriers to entry with minimal exposure to…extrinsic risks we can’t control.” 

Ackman’s raise comes as Airbnb CEO Brian Chesky confirmed the company was approached about a merger with a so-called blank-check company, though Chesky added, “We’re looking at everything.” (When asked about Airbnb, Ackman said, “We would certainly take a look at Airbnb. I’ve always admired the business.”) Another venture-backed startup, Hims, which provides healthcare products for men, is also reportedly considering going public via a SPAC in a deal that could value it at over $1 billion.

All in all, it’s been a bang-up year for SPACs. Some 48 have raised $18.6 billion so far this year, vastly eclipsing the total figure of $13.6 billion raised in all of 2019, according to SPACInsider. And they haven’t rested on their laurels.

That said, a SPAC isn’t guaranteed to find an acquiree.

Lucinda Shen
Twitter: @shenlucinda
Email: lucinda.shen@fortune.com

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