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On Tuesday, July 16, Eastern Time, well-known hedge fund manager Bill Ackman publicly told potential investors that his high exposure on social media will help his U.S. investment fund Pershing Square USA obtain a premium valuation.

The fund is targeting up to $25 billion, which, if raised successfully, would be one of the largest IPOs ever, rivaling those of Saudi Aramco and Chinese tech giant Alibaba.

Public data shows that Bill Ackman had accurately shorted U.S. stocks during the pandemic, and in 2023 he again successfully shorted U.S. bonds and accurately closed his positions at low points. Ackman has gained hundreds of thousands of followers on social media in the past year by criticizing current President Biden and supporting former President Trump. He has also actively spoken out on social media to oppose what he believes to be anti-Semitism on American college campuses, often expressing his views through long social media posts.

Ackman has more than 1 million followers on social media platform X, and he sees this social media influence as an important asset for the fund. He plans to use social media platforms to introduce investors to his investment strategy, including the assets selected for the portfolio and the large hedging measures that may be taken in the event of a severe market decline. In addition, he also plans to hold an annual shareholder meeting similar to Berkshire Hathaway, attracting thousands of investors.

Ackman told shareholders during a public presentation during the IPO roadshow:

“While I have been unable to discuss investment activity on social media in the past due to regulatory restrictions, I will now be able to freely update shareholders on portfolio developments.”

The Pershing Square USA fund plans to be listed on the New York Stock Exchange in the form of a management company, investing in large listed companies that Ackman believes are undervalued and have competitive advantages. The fund is a closed-end fund, and its assets cannot be redeemed at any time, which is suitable for a long-term investment style.

While Ackman’s European-listed fund, Pershing Square Holdings, has for years faced problems with shares trading at a discount to net asset value, that discount has narrowed recently, in part due to Ackman’s active presence on social media over the past year.

Ackman also said that his new fund plans to take original shares in some large companies that are about to go public as anchor shareholders of IPOs. He mentioned payment giant Stripe and Musk's Starlink, X and SpaceX as possible investment targets for his fund.

Although Pershing Square Holdings has performed strongly during the COVID-19 pandemic, with a return of 183.8% over the past five years, the fund suffered heavy losses before the pandemic due to a large investment in Valeant Pharmaceuticals, which led most institutional investors to withdraw their funds.

Ackman plans to price the IPO at $50 a share with a 2% management fee, similar to many hedge funds, but with no performance fees attached. By comparison, Pershing Square Holdings' European fund charges 16% on investment gains.

Ackman concluded: “You get my performance at my peak for free.” The implication is that investors pay a fixed management fee, rather than the high performance fees they would pay in a European fund, which gives investors the feeling that they are getting Ackman’s investment expertise for free, especially at the peak of his career.