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Colin Kaepernick SPAC Deal Collapses, Testing Celebrity Halo



The Change Co. seemed like the perfect company for

Colin Kaepernick’s

SPAC to buy. The California lender focuses on minority borrowers underserved by traditional banks, a snug fit with the former National Football League star’s social-justice activism.

But a deal ran aground last week over a peculiar issue: Mr. Kaepernick’s reluctance to stump for the merger on live television, people familiar with the matter said.

Mr. Kaepernick balked at requests from Change Co. executives that he sit for an appearance with

George Stephanopoulos

on “Good Morning America” and declined to participate in interviews as part of the rollout, according to an internal document.

The deal is now dead, these people said.

“The Change Company would proudly consider a partnership with Mr. Kaepernick—yesterday, today, or tomorrow,” the lender’s chief executive,

Steven Sugarman,

said in a written statement on Thursday that praised the former quarterback’s commitment to racial justice.

A spokesman for Mr. Kaepernick’s

Mission Advancement Corp.

MACC 0.10%

said that the company operates “with the highest ethical standards” and will “continue our work while we look for a great fit to merge with in 2022.”

Special-purpose acquisition companies, or SPACs, are blossoming. There are artificial-intelligence SPACs, green-energy SPACs and even at least two SPACs doing deals with sellers of outdoor cooking equipment. Celebrity SPACs are especially fertile.

Shaquille O’Neal,

Sammy Hagar,

Alex Rodriguez,


Danny Meyer,

and former House Speaker

Paul Ryan

each has a SPAC. The pitch to investors is that their star power, social-media following and financial contacts will help the company succeed.

The high-wattage fundraising is controversial; Securities and Exchange Commission chief

Gary Gensler

called out celebrity endorsements in a critique of SPAC marketing earlier this month and cautioned against “misleading hype.”

Mission Advancement went public in March and raised $345 million to acquire a company with a socially conscious bent. Mr. Kaepernick, who became a leader of the racial-justice movement since he went unsigned by National Football League teams after kneeling during the national anthem to protest issues such as police brutality, is Mission’s co-chairman along with

Jahm Najafi,

who runs a private-equity fund and is a minority owner in the National Basketball Association’s Phoenix Suns.

Like all SPACs, Mission searches for a target with which it will merge, effectively taking that company public. By early fall, it had homed in on Change and by mid-December was on the cusp of a deal valuing the lender at about $1.1 billion, according to the people familiar with the matter and investor documents reviewed by The Wall Street Journal.

But the two sides found themselves at odds over whether and how Mr. Kaepernick would tap his celebrity status to promote it. When Change executives tried to schedule a sit-down with “Good Morning America,” where Mr. Kaepernick would likely have been pressed both about the business and on the protests that made him a controversial figure and stymied his NFL career, Mission executives pushed back.

Such an appearance would have been out of character for Mr. Kaepernick, who has never spoken about the issue in such a forum and has granted few interviews. Instead, he has cultivated his image through his social-justice initiatives and scripted appearances, most notably an advertising campaign with

Nike Inc.

and a six-part documentary about his childhood that ran on

Netflix Inc.

this fall.

Change is what is known as a community development financial institution, a special regulatory designation for firms that lend to minority groups, rural residents and other communities that have trouble getting access to mainstream banking products. CDFIs receive financial support from the U.S. Treasury and often partner with big commercial banks. Many are nonprofits; Change isn’t.

Change was founded in 2017 and is run by Mr. Sugarman, a former executive at the Banc of California. He left that company in an acrimonious dispute with the board.

Change originated $7 billion in loans in 2020 and booked $113 million in profits, according to documents shown to prospective investors.

When SPACs make an acquisition, they typically also raise new money from private investors, which validates the transaction and gives the company cash to fund its growth.

Mission, Change and their bankers fanned out to more than 100 potential investors, firms that might want a piece of a socially conscious deal or celebrities who might kick in their own fame and money. Mission executives often referred to Mr. Kaepernick as a once-in-a-generation cultural icon; both sides hoped his star power would bring in investors and corporate partners.


Tyler Perry

agreed to invest, one of the people familiar with the matter said, and the Atlanta firm that manages his money made a $1 million commitment, the documents show. Mr. Kaepernick’s cachet helped land more investors—WNBA stars

Diana Taurasi


Maya Moore,

music producer

J. Cole,

and rappers




were in, according to the documents. But the commitments weren’t large, and some of the celebrity investors expected to be paid for any promotional efforts.

The sponsor group, Messrs. Kaepernick and Najafi, were set to contribute $10 million. Had the deal been completed, they would have received founder shares in the combined company worth about $80 million, according to the SPAC’s public filings. Mr. Kaepernick and the sponsor group also were going to donate up to one million shares, with a value near $10 million, to down-payment assistance efforts to support Black homeownership.

But big names on Wall Street, including

BlackRock Inc.,

Fidelity Investments and

T. Rowe Price Group Inc.,

which are among the most active SPAC investors, said no, according to the people familiar with the matter and documents reviewed by the Journal. The three declined to comment.

Serena Williams’s

venture fund passed, according to those documents. So did

Oprah Winfrey’s

money manager. Nike and venture firm Andreesen Horowitz, whose co-founder is listed on Mission’s website as an adviser, also looked at the deal and didn’t commit, the documents say.

‘There is a real question about whether there is [a] halo effect that translates into investor dollars. We need to question that assumption.’

— Steve Sugarman, The Change Co. chief executive

The week before Thanksgiving, executives from Mission and Change met with executives from Netflix. The streaming giant had just aired the Kaepernick documentary, and the year earlier it had moved $10 million of its cash holdings to Change as part of a pledge to support small lenders serving Black communities.

By the time the deal fell apart, Netflix hadn’t committed. Netflix declined to comment.

Mission ultimately had commitments for about two-thirds of the $100 million it was targeting, most of it from a pair of real-estate investment firms, Angelo Gordon and

MFA Financial Inc.,

the people familiar with the matter said.

“There is a real question about whether there is [a] halo effect that translates into investor dollars,” Mr. Sugarman wrote in an email this month to Mission executives. “We need to question that assumption.”

Write to Liz Hoffman at and Andrew Beaton at

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Teladoc Tumbled 38% After Big First-Quarter Loss. Is It Just a Pandemic Play?



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After pandemic drop, Canada’s detention of immigrants rises again By Reuters



© Reuters. FILE PHOTO: Two closed Canadian border checkpoints are seen after it was announced that the border would close to “non-essential traffic” to combat the spread of novel coronavirus disease (COVID-19) at the U.S.-Canada border crossing at the Thousand Isla

By Anna Mehler Paperny

TORONTO (Reuters) – Canada is locking up more people in immigration detention without charge after the numbers fell during the pandemic, government data obtained by Reuters shows.

Authorities cite an overall rise in foreign travelers amid easing restrictions but lawyers say their detained clients came to Canada years ago.

Canada held 206 people in immigration detention as of March 1, 2022 – a 28% increase compared with March 1 of the previous year. Immigration detainees have not been charged with crimes in Canada and 68% of detainees as of March 1 were locked up because Canada Border Services Agency (CBSA) fears they are “unlikely to appear” at an immigration hearing, according to the data.

The rise puts Canada at odds with Amnesty International and other human rights groups that have urged Ottawa to end its use of indefinite immigration detention, noting CBSA has used factors such as a person’s mental illness as reason to detain them.

A CBSA spokesperson told Reuters that “when the number of entries (to Canada) goes up, an increase in detention is to be expected.” CBSA has said in the past it uses detention as a last resort.

A lawyer told Reuters her detained clients have been in Canada for years.

In the United Kingdom, too, immigration detention levels rose last year after dropping earlier in the pandemic, according to government statistics. Unlike Canada, the United States and Australia, European Union member states have limits on immigration detention and those limits cannot exceed six months.

The rise in detentions puts people at risk of contracting COVID-19 in harsh congregate settings, refugee lawyers say.

Julia Sande, Human Rights Law and Policy Campaigner with Amnesty, called the increase in detentions “disappointing but not surprising,” although she was reluctant to draw conclusions from limited data.

The number of immigration detainees in Canada dropped early in the pandemic, from a daily average of 301 in the fourth quarter (January through March) of 2019-20 to 126 in the first quarter (April through June) of 2020-21.


Detaining fewer people did not result in a significant increase in no-shows at immigration hearings – the most common reason for detention, according to Immigration and Refugee Board data.

The average number of no-shows as a percentage of admissibility hearings was about 5.5% in 2021, according to that data, compared to about 5.9% in 2019.

No-shows rose as high as 16% in October 2020, but a spokesperson for the Immigration and Refugee Board said this was due to people not receiving notifications when their hearings resumed after a pause in the pandemic.

Refugee lawyer Andrew Brouwer said the decline in detention earlier in the pandemic shows Canada does not need to lock up as many non-citizens.

“We didn’t see a bunch of no-shows. We didn’t see the sky fall … It for sure shows that the system can operate without throwing people in jail,” Brouwer said.

He added that detainees face harsh pandemic conditions in provincial jails – including extended lockdowns, sometimes with three people in a cell for 23 hours a day.

Refugee lawyer Swathi Sekhar said CBSA officials and the Immigration and Refugee Board members reviewing detentions took the risk of COVID-19 into account when deciding whether someone should be detained earlier in the pandemic but are doing so less now.

“Their position is that COVID is not a factor that should weigh in favor of release,” she said.

“We also see very, very perverse findings … [decision-makers] outright saying that individuals are going to be safer in jail.”

The Immigration and Refugee Board did not immediately respond to a Reuters request for comment.

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Nasdaq futures rise as market attempts comeback from April sell-off, Meta shares soar



Stock futures rose in overnight trading as the market shook off the April sell-off and investors reacted positively to earnings from Meta Platforms.

Futures on the Dow Jones Industrial Average added 70 points or 0.2%. S&P 500 futures gained 0.7% and Nasdaq 100 futures jumped 1.2%.

The moves came as shares of Meta surged more than 18% after hours following a beat on earnings but a miss on revenue, a sign that investors may see signs of relief in the beaten-up tech sector. Shares were down 48% on the year heading into the results.

Meanwhile, shares of Qualcomm gained 5.6% in extended trading on the back of strong earnings while PayPal rose 5% despite issuing weak guidance for the second quarter.

“I think a lot of people want to believe that earnings are going to pull us out of this, but earnings are not what got us into this,” SoFi’s Liz Young told CNBC’s “Closing Bell: Overtime” on Wednesday. “… But the reality is there are so many macro headwinds still in front of us in the next 60 days that the market is just hard to impress.”

The after-hour activity followed a volatile regular trading session that saw the Nasdaq Composite stoop to its lowest level in 2022, as stocks looked to bounce back from a tech-led April sell-off. The index is down more than 12% since the start of April.

In Wednesday’s regular trading, the tech-heavy Nasdaq ended at 12,488.93, after rising to 1.7% at session highs. The Dow Jones Industrial Average rose 61.75 points, or 0.2%, to 33,301.93 propped up by gains from Visa and Microsoft, while the S&P 500 added 0.2% to 4,183.96.

Investors await big tech earnings on Thursday from Apple, Amazon and Twitter, along with results from Robinhood. Jobless claims are also due out Thursday.

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