Many investors have heard, “data is the new oil.” Yet few grasp the full meaning of the phrase as intended by Clive Humby, the entrepreneur who coined it in 2006.

For like oil, data is only valuable if refined, and when it comes to information, that requires analysis. This is the core value proposition of Alchemy Investments – a special purpose acquisition company (SPAC) with a “focus on data analytics” that is preparing to raise $100 million through its impending initial public offering (IPO).

Alchemy Investments Acquisition Corp filed with the Securities and Exchange Commission (SEC) on December 2nd, indicating it would make 10 million units available through the launch, priced at $10 apiece.

Alchemy Investments was formed last year by Chairman Steven Wasserman and co-CEOs Mattia Tomba and Vittorio Savoia. It is incorporated in the Cayman Islands and based in Newark, Delaware. Management is yet to decide on a date for the launch but plans to list their company on the NASDAQ as “ALCYU.”

As a SPAC, Alchemy is not coming to the market with an established business of its own. Instead, it will use this IPO to raise funds with the express intent of acquiring an existing company at a later stage. It has not specified which firm it intends to buy up but will “focus on companies acquiring, processing, analyzing, and utilizing data acquired from a variety of systems and sources.” This, it stated, could cover firms that leverage data to develop applications in energy, agriculture, finance, aerospace, infrastructure, and other related industries. The target’s value should be at least $500 million.

The big data revolution has been gaining steam for many years and has only accelerated since the pandemic, which unleashed a wave of unprecedented digitalization on the lives of individuals and the operations of companies. Big data is seemingly ubiquitous, touching on everything from public transport to medicine and from fitness to personal finance.

According to Fortune Business Insights, the global big data analytics market was valued at around $207 billion in 2020, yet it is now estimated to be on track to reach $550 billion by 2028.

One potential pathway to runaway growth for this industry stems from harnessing the exponential power of artificial intelligence (AI), whether it be in computer vision, natural language processing, or other adjacent applications.

According to McKinsey’s “Technology Trends Outlook 2022”, the applied AI sector has the highest innovation score of 14 technology trends researched. It is also a top area for investment, attracting an estimated $165 billion in 2021. McKinsey defines this sector as machine learning models that are “used to solve classification, prediction, and control problems to automate activities, add or augment capabilities and offerings, and make better decisions.”

Despite the bullish case to be made for deep tech and AI applications, Alchemy’s IPO comes at a time of uncertainty for the SPAC model.

Strategic acquisition plays came into vogue during the pandemic as a flood of SPACs hit the surging market from 2020 through 2021. In the decade to 2019, there were never more than 60 SPACs in any given year, per SPAC Analytics. In 2020, that number shot to 248 before soaring to reach 613 in 2021. Yet the IPO bubble popped this year, and SPACs have faded into the background amid a bearish market downturn. There have just been 83 as of December.

In weighing up Alchemy’s offering, investors will likely look at the long-term growth potential of industrial data analytics applications. They’ll also consider if Wasserman and the team can identify a uniquely valuable target company within that segment and whether they have the managerial prowess to take it over and unlock its full potential.

This article was produced and syndicated by Wealth of Geeks.

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