Digital World’s (NASDAQ:DWAC) filed a new S-1 today, providing highly anticipated information into the investors of its $1 billion PIPE.

A total of 48 investors have subscribed to this PIPE, with ownership post-conversion of the Preferred Stock between 11,350,000 shares and 50,000 shares. This largest purchase comes from Truth SPC, an entity that would appear to have something to do with Truth Social, but is currently registered to a Kentucky PO box and represented for voting purposes by a certain Nathan Smith.

Same for Red Rowan Investments, which will own 10,000,000 shares post-conversion, but whose entity was registered on December 14, 2021, eight days after the PIPE was announced.

Overall, the majority of PIPE investors are, as has long been speculated, hedge funds, but some venture capital has also taken part. Alta Partners, a venture firm that primarily invests in healthcare is set to own 3,500,000 shares post-conversion.

To refresh, according to Digital World’s original 8-K, the PIPE shares are to be registered no later than the closing date of the combination. Meaning, the SPAC intends to register the shares ahead of time during the proxy review period so they are freely tradable immediately at closing.

Typically, PIPE shares are filed to be registered after the deal has closed effectively creating a “lock-up period” for PIPE investors while the shares go through the registration process.  However, considering that there is also no stated lock-up on PIPE investors and those shares will already be registered, this could result in a large amount of selling pressure on the stock.

Other details in this S-1 also stand out. The risk factors sections of these documents can sometimes present fairly vivid downside scenarios because the legal teams want to be thorough in eliminating potential litigation risk. Still, some stated risk factors can be revelatory, some of which we have highlighted before. Another risk of note is enumerated as: “The members of TMTG’s management team have extensive experience leading complex organizations. However, they have limited experience managing a publicly-traded company, interacting with public company investors, and complying with the increasingly complex laws, rules and regulations that specifically govern public companies.”

In other words, “just so you know, we may not be great at this public company stuff”?

PIPE Investors below: