# How Can Truth Social be worth $6 Billion? {Trump Media & Technology (DJT)} **URL:** \ **Category:** In My Humble Opinion\ **Tags:** trump\ **Created:** [March 22, 2024, 1:23pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202 "2024-03-22T13:23:05Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![chappachula](https://avatars.discourse-cdn.com/v4/letter/c/d2c977/32.png) [@chappachula](https://boards.straightdope.com/u/chappachula)\ **Post date:** [March 24, 2024, 9:45am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/61 "2024-03-24T09:45:42Z")
> [@wolfpup](#): > > get a piece of fabric allegedly from the suit that Trump wore… The depth to which that man will stoop to fleece the rubes is almost as incomprehensible as the stupidity of his victims. Hey, in 1964, it worked for the Beatles. 🙂 > [@](#): > > two enterprising DJs paid the owners of the hotels $750 for all of the band’s linens, including pillow cases and towels, and cut them up into 7,200 one-inch squares,… and sold them to eager fans for $1 a piece. Those $1 items now go for $150 cite:[A Beatle Slept With This: Pieces of the Mania | Collectors Weekly](https://www.collectorsweekly.com/articles/a-beatle-slept-with-this-pieces-of-the-mania/) ---
**Author:** ![Stratocaster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/stratocaster/32/16393_2.png) [@Stratocaster](https://boards.straightdope.com/u/Stratocaster)\ **Post date:** [March 24, 2024, 10:34am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/62 "2024-03-24T10:34:00Z")
> [@zbuzz](#): > > But I don’t know the details. Yeah, I’m not an expert on SPACs, but I’m not sure how a restriction on any kind of encumbrance permits this one. ---
**Author:** ![Loach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/loach/32/350_2.png) [@Loach](https://boards.straightdope.com/u/Loach)\ **Post date:** [March 24, 2024, 2:19pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/63 "2024-03-24T14:19:23Z")
I know there have been a lot of cites posted and maybe it was answered and I didn’t see it. Trump holds 60% of the company. How much actual money did he put into it or did someone waive a magic wand and say he has 60%? If he didn’t sink any significant cash into it then even if the price tanks he still would have made money from nothing, just not as much. ---
**Author:** ![dtilque](https://avatars.discourse-cdn.com/v4/letter/d/d6d6ee/32.png) [@dtilque](https://boards.straightdope.com/u/dtilque)\ **Post date:** [March 24, 2024, 3:37pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/64 "2024-03-24T15:37:16Z")
> [@Loach](#): > > Trump holds 60% of the company. How much actual money did he put into it or did someone waive a magic wand and say he has 60%? I don’t know for certain, but I expect he didn’t put any money into it. He likely got the 60% by agreeing to restrictions on his posting. That is, the requirement that he post things on Twuth instead of other social media. ---
**Author:** ![CaveMike](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cavemike/32/16379_2.png) [@CaveMike](https://boards.straightdope.com/u/CaveMike)\ **Post date:** [March 24, 2024, 5:16pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/65 "2024-03-24T17:16:24Z")
> [@zbuzz](#): > > I have no idea if this is the right answer but apparently there will be about 136 million shares of DJT after the merger closes and DWAC has been at roughly $40 for the past week so that gets you into the ~5.5 billion range, right? Thanks, the 136M is what I was missing. The link below also quotes the 136M number and clarified that DWAC converts to DJT at 1:1. There are about 37M shares of DWAC so there must be about 100M of TM&T. I guess the capital raised by DWAC at IPO and PIPE goes to the new company after the officers get their share. > **[Trump's Truth Social is losing money and has scant sales. Yet it could trade...](https://www.cbsnews.com/news/trump-truth-social-spac-stock-value-djt/)** > > Former President Donald Trump's Truth Social could soon trade on the stock market with the ticker DJT. Here's what to know. I wonder if the DWAC shareholders knew they were only getting a fourth of TS? These SPACs seem like huge scams even without TS. ---
**Author:** ![Gordon\_G](https://avatars.discourse-cdn.com/v4/letter/g/3da27b/32.png) [@Gordon\_G](https://boards.straightdope.com/u/Gordon_G)\ **Post date:** [March 24, 2024, 5:28pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/66 "2024-03-24T17:28:20Z")
> [@Moriarty](#): > > I posted this elsewhere, but it’s my understanding that really rich people don’t sell their stock to generate income. Rather, they use the valuation of those stocks to get loans, which they then repay at a pittance of interest when compared to any income tax that would be due when liquidating the stock. > … > So donald doesn’t have to sell his stock to take advantage of its value. > … > But will any lender accept the valuation? Unless it’s the Bank of North Korea, I have a hard time believing that’s possible. The same agreement that prevents Mr. Trump from selling his shares for six months, also prevents him from using the shares as collateral on a loan. OTOH, what’s to stop him from violating the agreement? He’ll be sued? But will he have money in the bank while his lawyers delay delay delay? ---
**Author:** ![wolfpup](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wolfpup/32/10618_2.png) [@wolfpup](https://boards.straightdope.com/u/wolfpup)\ **Post date:** [March 24, 2024, 5:40pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/67 "2024-03-24T17:40:50Z")
> [@Gordon\_G](#): > > OTOH, what’s to stop him from violating the agreement? He’ll be sued? Nothing has ever stopped Trump from perpetrating whatever illegal scam is convenient at the moment, but the real question is what lender would accept as collateral a stock holding that is not allowed to be used as such. It would have to be a really convoluted and sleazy underhanded arrangement, and when that kind of money is involved, I imagine the deal would get a lot of scrutiny from regulators. ---
**Author:** ![Stratocaster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/stratocaster/32/16393_2.png) [@Stratocaster](https://boards.straightdope.com/u/Stratocaster)\ **Post date:** [March 24, 2024, 5:58pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/68 "2024-03-24T17:58:42Z")
> [@Gordon\_G](#): > > OTOH, what’s to stop him from violating the agreement? He’ll be sued? But will he have money in the bank while his lawyers delay delay delay? The SEC will give him a day he’ll never forget. As I mentioned, their fines for egregious, premeditated offenses usually take the form of “all your ill-gotten gains plus a bazillion dollars.” They like sending unmistakable messages to the offender and the general public. To those worried that Trump will just flout the rules and do what he wants, you have to understand that the SEC leadership is cut from the same piece of cloth as Fani Willis, Letitia James, Alvin Bragg, Jack Smith, et.al. They don’t give a shit what gets posted on TS or about any MAGA outrage. They have all the leverage and they can bring down a world of pain. Nothing Trump can do about it except waste money on delays. This Monday will be yet another example. ---
**Author:** ![zbuzz](https://avatars.discourse-cdn.com/v4/letter/z/e19b73/32.png) [@zbuzz](https://boards.straightdope.com/u/zbuzz)\ **Post date:** [March 24, 2024, 11:04pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/69 "2024-03-24T23:04:02Z")
> [@Loach](#): > > How much actual money did he put into it or did someone waive a magic wand and say he has 60%? I don’t think he put any money into Truth Social. A couple of former Apprentice contestants approached him with the idea of a Twitter ripoff and agreed to let him retain 90% of TS in exchange for his name and association with it. And then they rounded up some known Trump donors/sycophants for the seed money including the guy who controlled DWAC, which got more investors on board but diluted Trump’s ownership slice. But like I’ve said before, I’m just guessing and have no idea how any of this shit works. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [March 24, 2024, 11:04pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/70 "2024-03-24T23:04:09Z")
> [@DavidNRockies](#): > > > [@msmith537](#): > > > > I guess my question is who is valuing Truth Social and underwriting the IPO? > > Probably worth noting again that this wouldn’t be an IPO, but a SPAC: > > ONE: [**What are the differences in an IPO, a SPAC, and a direct listing?**](https://www.sec.gov/education/capitalraising/building-blocks/registered-offerings) > > TWO: [**Trump’s Truth Social To Go Public Via Merger With DWAC**](https://www.investopedia.com/trump-truth-social-to-go-public-via-merger-with-dwac-8613288) Technically a SPAC is a type of IPO. I just don’t know enough about the details of how a SPAC works vs a traditional IPO (which I’ll just call an “IPO”.). The SEC link says: “A SPAC goes public as a shell company using an IPO for the purpose of merging with or acquiring a yet-to-be-identified private operating company. Generally within two years, the SPAC combines with the private company via a de-SPAC merger, with the resulting company becoming public and receiving a combination of the SPAC’s IPO proceeds and additional capital from a private financing.” I assume that means the SPAC shares aren’t traded on an exchange like regular IPO shares? Or they are somehow restricted to be used as part of some future merger? According to Fidelity, " If sponsors fail to create a combination within two years, **the SPAC must be dissolved and all funds returned to the original investors**. The sponsors lose not only their risk capital but also the not-insignificant investment of their own time." But who is raising the cash for Trumps Truth Social? According to Wikipedia: " DWAC was created with the help of ARC Capital, a [Shanghai](https://en.wikipedia.org/wiki/Shanghai)-based firm specializing in listing [Chinese companies](https://en.wikipedia.org/wiki/Chinese_companies) on [American stock markets](https://en.wikipedia.org/wiki/American_stock_markets) that has been a target of [U.S. Securities and Exchange Commission](https://en.wikipedia.org/wiki/U.S._Securities_and_Exchange_Commission) (SEC) investigations for misrepresenting shell corporations." “In 2021, the DWAC Trump venture was linked with another company, China Yunhong Holdings.” So not at all shady. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [March 25, 2024, 12:26am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/71 "2024-03-25T00:26:13Z")
Yeah, the Chinese connection here is really disturbing. ---
**Author:** ![CaveMike](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cavemike/32/16379_2.png) [@CaveMike](https://boards.straightdope.com/u/CaveMike)\ **Post date:** [March 25, 2024, 12:48am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/72 "2024-03-25T00:48:13Z")
> [@msmith537](#): > > Technically a SPAC is a type of IPO. I just don’t know enough about the details of how a SPAC works vs a traditional IPO (which I’ll just call an “IPO”.). The SPAC itself does an IPO normally, although it is trivial since there is nothing to value. All of the capital raised goes into escrow for purchasing future companies. After the IPO, they can also do additional fundraising to add to the escrow. > [@msmith537](#): > > So not at all shady. Exactly. Plus in this case one of the directors discussed the deal with Trump before forming the SPAC which is not legal. ---
**Author:** ![Loach](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/loach/32/350_2.png) [@Loach](https://boards.straightdope.com/u/Loach)\ **Post date:** [March 25, 2024, 2:04am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/73 "2024-03-25T02:04:57Z")
> [@zbuzz](#): > > > [@Loach](#): > > > > How much actual money did he put into it or did someone waive a magic wand and say he has 60%? > > I don’t think he put any money into Truth Social. A couple of former Apprentice contestants approached him with the idea of a Twitter ripoff and agreed to let him retain 90% of TS in exchange for his name and association with it. And then they rounded up some known Trump donors/sycophants for the seed money including the guy who controlled DWAC, which got more investors on board but diluted Trump’s ownership slice. > > But like I’ve said before, I’m just guessing and have no idea how any of this shit works. So even if it tanks he could walk away with millions that he didn’t have before ---
**Author:** ![zbuzz](https://avatars.discourse-cdn.com/v4/letter/z/e19b73/32.png) [@zbuzz](https://boards.straightdope.com/u/zbuzz)\ **Post date:** [March 25, 2024, 4:37am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/74 "2024-03-25T04:37:11Z")
> [@Loach](#): > > So even if it tanks he could walk away with millions that he didn’t have before I think that’s a very likely scenario no matter which way it plays out, yes. ---
**Author:** ![Stratocaster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/stratocaster/32/16393_2.png) [@Stratocaster](https://boards.straightdope.com/u/Stratocaster)\ **Post date:** [March 25, 2024, 10:25am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/75 "2024-03-25T10:25:31Z")
> [@zbuzz](#): > > I think that’s a very likely scenario no matter which way it plays out, yes. I agree. This will be some found money for Trump. But I highly doubt it will be the billions some are predicting. ---
**Author:** ![wolfpup](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wolfpup/32/10618_2.png) [@wolfpup](https://boards.straightdope.com/u/wolfpup)\ **Post date:** [March 25, 2024, 10:47am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/76 "2024-03-25T10:47:55Z")
> [@Loach](#): > > So even if it tanks he could walk away with millions that he didn’t have before I expect both things to happen in fairly short order. So IOW, business as usual for the orange conman, with everybody else left holding the bag. ---
**Author:** ![Horatius](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/horatius/32/3572_2.png) [@Horatius](https://boards.straightdope.com/u/Horatius)\ **Post date:** [March 25, 2024, 11:35am UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/77 "2024-03-25T11:35:16Z")
> [@wolfpup](#): > > with everybody else left holding the bag. Hell, they’ll be lucky if they actually have the bag! ---
**Author:** ![snowthx](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/snowthx/32/10660_2.png) [@snowthx](https://boards.straightdope.com/u/snowthx)\ **Post date:** [March 25, 2024, 12:28pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/78 "2024-03-25T12:28:59Z")
It’ll be interesting to see who is holding that empty bag. Institutional investors with armies of bankers advising them when to make a move, or main street chumps who bought into the whole facade. Will this be the biggest “fleece-a-rube” scheme yet? ---
**Author:** ![Stratocaster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/stratocaster/32/16393_2.png) [@Stratocaster](https://boards.straightdope.com/u/Stratocaster)\ **Post date:** [March 25, 2024, 2:25pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/79 "2024-03-25T14:25:35Z")
> [@snowthx](#): > > It’ll be interesting to see who is holding that empty bag. Institutional investors with armies of bankers advising them when to make a move, or main street chumps who bought into the whole facade. I think the latter. Savvy investment advisors know when an investment lacks fundamentals. Those with brass balls might try a “greater fool” strategy to quickly get in on (and out of) the grift before the bubble bursts. But the suckers left holding the empty bag will likely be MAGA faithful or the usual day-trading speculators who talk themselves into something. ---
**Author:** ![Johnny\_Bravo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/johnny_bravo/32/493_2.png) [@Johnny\_Bravo](https://boards.straightdope.com/u/Johnny_Bravo)\ **Post date:** [March 25, 2024, 3:11pm UTC](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202/80 "2024-03-25T15:11:03Z")
> [@Stratocaster](#): > > But the suckers left holding the empty bag will likely be MAGA faithful Yeah, I’ve been thinking about that. There’s gotta be a lot of destroyed wealth from True Believers who thought they were helping Truth and Trump. That’s money that could have just been donations to the RNC or an affiliated PAC. [Previous page](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202.md?page=3) [Next page](https://boards.straightdope.com/t/how-can-truth-social-be-worth-6-billion-trump-media-technology-djt/999202.md?page=5)