Hedge fund Elliott Management has announced that it is in the early stages of seeking funding to create a special purpose acquisition company (SPAC), also known as a blank check company. While the fund has no concrete plans and potential candidates to take public yet, the growing attention the financial world is paying to SPACs could pose a lucrative opportunity.

According to a report by Dow Jones, Elliott is seeking funding to the tune of $1 billion. The $1 billion price target that Elliott has set is a fairly high target, given that only a dozen SPACs have ever raised more than $1 billion. According to the report, other SPACs that had been able to raise funding close to Elliott's target were able to secure deals with companies boasting valuations in the tens of billions. While Elliott hasn't made any plans or announced what industry it planned to look towards, its portfolio is very diverse, featuring past and current holdings from telecommunications, energy, and retail.

SPACs are essentially empty shells used to take companies public in place of the traditional IPO method. 2020 was a landmark year for SPACs, and listings in general, with 165 companies going public through SPACs out of the 480 IPOs that took place. In terms of finances, SPACs raised just under $80 billion in funding last year. Given the lucrative nature of SPACs and the relative ease they afford companies seeking to go public, it's no surprise Elliott Management wants in.

2020's top SPAC IPOs were exceptionally lucrative and were relatively diverse across a wide range of industries. The upcoming merger of QuantumScape (QS  ) and Kensington Capital Acquisition Corp (KCAC  ), a SPAC, has driven shares of QuantumScape up a whopping 388%. Draft Kings (DKNG  ) went public through a merger with Diamond Eagle Acquisition Corp and SBTech and has skyrocketed in price by 197%.