Colin Kaepernick SPAC Deal Collapses, Testing Celebrity Halo

Mr. Kaepernick balked astatine requests from Change Co. executives that helium beryllium for an quality with George Stephanopoulos connected “Good Morning America” and declined to enactment successful interviews arsenic portion of the rollout, according to an interior document.

The woody is present dead, these radical said.

“The Change Company would proudly see a concern with Mr. Kaepernick—yesterday, today, oregon tomorrow,” the lender’s main executive, Steven Sugarman, said successful a written connection connected Thursday that praised the erstwhile quarterback’s committedness to radical justice.

A spokesperson for Mr. Kaepernick’s Mission Advancement Corp. MACC 0.10% said that the institution operates “with the highest ethical standards” and volition “continue our enactment portion we look for a large acceptable to merge with successful 2022.”

Special-purpose acquisition companies, oregon SPACs, are blossoming. There are artificial-intelligence SPACs, green-energy SPACs and adjacent astatine slightest 2 SPACs doing deals with sellers of outdoor cooking equipment. Celebrity SPACs are particularly fertile. Shaquille O’Neal, Sammy Hagar, Alex Rodriguez, restaurateur Danny Meyer, and erstwhile House Speaker Paul Ryan each has a SPAC. The transportation to investors is that their prima power, social-media pursuing and fiscal contacts volition assistance the institution succeed.

The high-wattage fundraising is controversial; Securities and Exchange Commission chief Gary Gensler called retired personage endorsements successful a critique of SPAC selling earlier this period and cautioned against “misleading hype.”

Mission Advancement went nationalist successful March and raised $345 cardinal to get a institution with a socially conscious bent. Mr. Kaepernick, who became a person of the racial-justice question since helium went unsigned by National Football League teams aft kneeling during the nationalist anthem to protestation issues specified arsenic constabulary brutality, is Mission’s co-chairman on with Jahm Najafi, who runs a private-equity money and is simply a number proprietor successful the National Basketball Association’s Phoenix Suns.

Like each SPACs, Mission searches for a people with which it volition merge, efficaciously taking that institution public. By aboriginal fall, it had homed successful connected Change and by mid-December was connected the cusp of a woody valuing the lender astatine astir $1.1 billion, according to the radical acquainted with the substance and capitalist documents reviewed by The Wall Street Journal.

But the 2 sides recovered themselves astatine likelihood implicit whether and however Mr. Kaepernick would pat his personage presumption to beforehand it. When Change executives tried to docket a sit-down with “Good Morning America,” wherever Mr. Kaepernick would apt person been pressed some astir the concern and connected the protests that made him a arguable fig and stymied his NFL career, Mission executives pushed back.

Such an quality would person been retired of quality for Mr. Kaepernick, who has ne'er spoken astir the contented successful specified a forum and has granted fewer interviews. Instead, helium has cultivated his representation done his social-justice initiatives and scripted appearances, astir notably an advertizing run with Nike Inc. and a six-part documentary astir his puerility that ran on Netflix Inc. this fall.

Change is what is known arsenic a assemblage improvement fiscal institution, a peculiar regulatory designation for firms that lend to number groups, agrarian residents and different communities that person occupation getting entree to mainstream banking products. CDFIs person fiscal enactment from the U.S. Treasury and often spouse with large commercialized banks. Many are nonprofits; Change isn’t.

Change was founded successful 2017 and is tally by Mr. Sugarman, a erstwhile enforcement astatine the Banc of California. He near that institution successful an acrimonious quality with the board.

Change originated $7 cardinal successful loans successful 2020 and booked $113 cardinal successful profits, according to documents shown to prospective investors.

When SPACs marque an acquisition, they typically besides rise caller wealth from backstage investors, which validates the transaction and gives the institution currency to money its growth.

Mission, Change and their bankers fanned retired to much than 100 imaginable investors, firms that mightiness privation a portion of a socially conscious woody oregon celebrities who mightiness footwear successful their ain fame and money. Mission executives often referred to Mr. Kaepernick arsenic a once-in-a-generation taste icon; some sides hoped his prima powerfulness would bring successful investors and firm partners.

Actor Tyler Perry agreed to invest, 1 of the radical acquainted with the substance said, and the Atlanta steadfast that manages his wealth made a $1 cardinal commitment, the documents show. Mr. Kaepernick’s cachet helped onshore much investors—WNBA stars Diana Taurasi and Maya Moore, euphony producer J. Cole, and rappers Quavo and Nas were in, according to the documents. But the commitments weren’t large, and immoderate of the personage investors expected to beryllium paid for immoderate promotional efforts.

The sponsor group, Messrs. Kaepernick and Najafi, were acceptable to lend $10 million. Had the woody been completed, they would person received laminitis shares successful the combined institution worthy astir $80 million, according to the SPAC’s nationalist filings. Mr. Kaepernick and the sponsor radical besides were going to donate up to 1 cardinal shares, with a worth adjacent $10 million, to down-payment assistance efforts to enactment Black homeownership.

But large names connected Wall Street, including BlackRock Inc., Fidelity Investments and T. Rowe Price Group Inc., which are among the astir progressive SPAC investors, said no, according to the radical acquainted with the substance and documents reviewed by the Journal. The 3 declined to comment.

Serena Williams’s task money passed, according to those documents. So did Oprah Winfrey’s wealth manager. Nike and task steadfast Andreesen Horowitz, whose co-founder is listed connected Mission’s website arsenic an adviser, besides looked astatine the woody and didn’t commit, the documents say.

The week earlier Thanksgiving, executives from Mission and Change met with executives from Netflix. The streaming elephantine had conscionable aired the Kaepernick documentary, and the twelvemonth earlier it had moved $10 cardinal of its currency holdings to Change arsenic portion of a pledge to enactment tiny lenders serving Black communities.

By the clip the woody fell apart, Netflix hadn’t committed. Netflix declined to comment.

Mission yet had commitments for astir two-thirds of the $100 cardinal it was targeting, astir of it from a brace of real-estate concern firms, Angelo Gordon and MFA Financial Inc., the radical acquainted with the substance said.

“There is simply a existent question astir whether determination is [a] halo effect that translates into capitalist dollars,” Mr. Sugarman wrote successful an email this period to Mission executives. “We request to question that assumption.”

Write to Liz Hoffman astatine liz.hoffman@wsj.com and Andrew Beaton astatine andrew.beaton@wsj.com