Known to some as the "SPAC King," Chamath Palihapitiya once had plans to launch SPACs with tickers IPOA through IPOZ. Those initial dreams failed, as several SPACs were liquidated without merger targets, and the SPAC market lost favor with retail investors.

Palihapitiya is back with a new SPAC, but with a new business structure he's telling retail investors to stay away.

Chamath Tells Retail Investors To Stay Away

Palihapitiya recently launched the American Exceptionalism Acquisition Corp (NYSE:AEXA) SPAC to bring a company in the AI, clean energy, or U.S. defense markets public.

Initially planned for a $250 million offering, the SPAC was upsized to $345 million due to strong demand.

Palihapitiya recently warned retail investors to stay away from the SPAC or to lower their expectations.

"I want to temper retail investors' involvement with my SPACs. This deal was built for institutional investors. Specifically, 98.7 percent went to large institutions, each picked explicitly by me. The remaining 1.3 percent was allocated to retail investors," Palihapitiya tweeted.

The investor said this was done after learning that SPACs "are not ideal for most retail investors."

"They are for investors who can underwrite the volatility, place it as part of a broader structured portfolio and have the capital to support the company ...