Crowd-Safety Company Evolv goes public in a $ 1.7 billion merger

Backed by investors, including Microsoft Corp.

co-founder Bill Gates and former Florida Gov. Jeb Bush have merged with SPAC NewHold Investment Corp.

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Based outside of Boston, Evolv uses artificial intelligence and computer science to examine people for weapons and other threats. The company says its platform eliminates the need for devices such as metal detectors and physical security controls. It is used in places like Six Flags Entertainment Corp.

amusement parks, Lincoln Center in New York and Gillette Stadium, home of the New England Patriots of the National Football League. Evolv says it has selected more than 50 million people in the past four years, the second worldwide just under the Transport Security Administration.

In 2020, Evolv also began using its technology to examine people at elevated body temperature, a feature Peter George said is very popular because businesses are reopening to closures designed to stop the spread of the coronavirus.

“We were built to solve this problem to make places safe,” he said. George said in an interview.

Evolv, founded in 2013, joins the growing pool of technology companies being publicized through mergers with SPACs, also known as blank-check companies. SPACs like NewHold Investment are shell companies listed on a stock exchange with the sole purpose of acquiring a private company like Evolv to make it public. The private company then gets the SPAC’s place in the stock market.

NewHold raised $ 150 million when it was unveiled last summer and was one of several blank check companies vying to take Evolv’s audience, NewHold CEO Kevin Charlton said.

Through the merger and an accompanying fundraising round, called a private investment in public equity, or PIPE, Evolv is expected to generate approximately $ 470 million in revenue. PIPE investors in the deal include well-known athletes such as former NFL fullback Peyton Manning and tennis players Andre Agassi and Steffi Graf.

Mr. Charlton said the SPAC will use part of its capital to launch a public benefit corporation designed to make Evolv’s platform affordable for venues such as schools. Evolv executives are also expected to contribute to the PBC.

In addition to Messrs. Gates and Bush, Evolv ventures into venture capital firms such as General Catalyst and Lux ​​Capital among its existing investors. None of the existing investors sold as part of the deal.

Combining it with a SPAC has become a popular way to publish for a company because SPAC mergers startups make rosy projections – something that should not be a traditional initial offering – and the creators of a blanket industry deserve several times their initial investment on average. Two hundred and twenty-eight blank check businesses raised $ 73 billion this year, bringing the market on track to break last year’s record of more than $ 80 billion, according to data provider SPAC Research.

Shares of SPACs and companies that have merged with them have been struggling in recent times, with investors withdrawing from technology stocks and government bond yields rising. NewHold shares fell back to their IPO price of $ 10 last week. Yet many new blank check businesses are entering the market and revealing transactions. Thirty-nine new SPACs raised money last week.

The Evolv agreement is expected to close in the second quarter, and Evolv expects to trade on the Nasdaq under the tick “EVLV”.

Write to Amrith Ramkumar by [email protected]