Just two months after listing its first venture fund, Robinhood is preparing to launch a second. The company has filed a confidential registration for RVII, a standard regulatory step that allows it to work through the approval process before releasing details.
Usuch as its first fund, which currently holds shares 10 later stage companies — Airwallex, Boom, Databricks, ElevenLabs, Mercor, OpenAI, Oura, Ramp, Revolut and Stripe — RVII will cast a wider net by investing in early-stage and early-stage startups. It’s an important distinction, given that early-stage startups are younger and carry more risk, but also offer the potential for greater returns.
The fundraising target for RVII has not yet been determined, the company said in a blog post. For its initial fund, Robinhood sought to raise $1 billion but ultimately fell several hundred million short of that goal.
Despite the shortfall, the first fund performed strongly. RVI — the index of Robinhood’s first mutual fund, which trades on the NYSE (New York Stock Exchange) — debuted on the NYSE at $21 a share in early March and has since more than doubled, closing Monday at $43.69. Market excitement over the AI prospects of the fund’s underlying startups likely fueled the stock’s rise.
The authority behind the two funds is addressing a long-standing gap in who can invest in startups. Under federal rules, only “accredited” investors – those with a net worth of more than $1 million or an annual income of more than $200,000 – can put money into private companies. This has historically excluded ordinary investors from the early and most lucrative stages of a company’s development. RVI, and now RVII, are designed to change that by allowing anyone to invest in a portfolio of private startups through a regular brokerage account.
“You can think [Robinhood Ventures] as a listed venture capital company with daily liquidity. No accreditation requirements and no porting,” said Robinhood CEO Vlad Tenev interview at the Wall Street Journal’s Future of Everything conference last week. Daily liquidity means shares can be bought or sold any day the market is open, unlike traditional VC funds, where capital is locked up for years. No carryover means Robinhood doesn’t take a percentage of investment profits like conventional venture capital firms typically do.
In recent years, the most valuable AI startups have gone from early bets to companies valued in the tens or hundreds of billions of dollars, and almost all of that appreciation has happened in the private markets, out of reach for most investors.
Tenev’s long-term vision goes even further. “The aspiration is, if you’re a company raising a seed round and a Series A round – so just the first capital – retail should be a big part of that round, as it is now in the public markets,” Tenev told the conference. “And we’re going to have to let those people in on the ground floor so they can really take advantage of that potential appreciation that’s happening more and more in the private markets.”
If this vision is implemented, it could fundamentally change the way startups raise their early capital, with retail investors eventually sitting alongside venture firms, even in early rounds, where the biggest returns are made and a lot of money is also lost.
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