▼ Summary
– Robinhood has filed a confidential registration for its second venture fund, RVII, following the listing of its first fund two months ago.
– RVII will invest in both growth-stage and early-stage startups, a broader approach than its first fund, which holds stakes in 10 late-stage companies.
– The fundraising target for RVII has not been set; its first fund fell short of its $1 billion goal but has performed strongly, with shares more than doubling since its debut.
– Both funds allow non-accredited investors to invest in private startups through a regular brokerage account, bypassing traditional rules that restrict such investments to wealthy individuals.
– Robinhood CEO Vlad Tenev aims to eventually let retail investors participate in seed and Series A rounds, potentially changing how startups raise early capital.
Just two months after its first venture fund hit the public market, Robinhood is already gearing up for a second act. The company has filed a confidential registration for RVII, a standard procedural step that lets it navigate the approval process before revealing specifics to the public.
The inaugural fund, RVI, currently holds positions in 10 late-stage companies: Airwallex, Boom, Databricks, ElevenLabs, Mercor, OpenAI, Oura, Ramp, Revolut, and Stripe. In contrast, RVII will take a broader approach, investing in both growth-stage and early-stage startups. This is a notable shift because early-stage companies are younger and inherently riskier, but they also carry the potential for outsized returns.
Robinhood has not yet set a fundraising target for RVII, according to a company blog post. For its first fund, the firm aimed to raise $1 billion but ultimately fell several hundred million short of that goal.
Despite missing its target, the first fund has delivered strong performance. RVI, which trades on the New York Stock Exchange, debuted at $21 per share in early March and has since more than doubled, closing on Monday at $43.69. Much of that surge likely stems from market enthusiasm for the AI prospects of the fund’s underlying portfolio companies.
The core idea behind both funds tackles a long-standing inequity: who gets to invest in startups. Under federal regulations, only accredited investors , those with a net worth over $1 million or an annual income above $200,000 , can buy into private companies. That rule has historically shut out ordinary investors from the earliest and most profitable stages of a company’s growth. RVI and now RVII aim to change that, letting anyone invest in a basket of private startups through a standard brokerage account.
“You can think of Robinhood Ventures as a publicly traded venture capital firm with daily liquidity. No accreditation requirements and no carry,” CEO Vlad Tenev said during an 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 carry means Robinhood does not take a percentage of investment profits, as conventional venture firms typically do.
Over the past several years, the most valuable AI startups have evolved from early bets into companies worth tens or even hundreds of billions of dollars. Almost all of that growth has occurred in private markets, completely out of reach for most investors.
Tenev’s longer-term vision is even more ambitious. “The aspiration is, if you’re a company raising a seed round and a Series A round , so, just first capital , retail should be a big chunk of that round, much like it now is in the public markets,” he said at the conference. “And we should let those people in at the ground floor, so that they can actually benefit from this potential appreciation that’s increasingly happening in the private markets.”
If that vision becomes reality, it could fundamentally reshape how startups raise their earliest capital. Retail investors could eventually sit alongside venture firms, including in the earliest rounds where the biggest returns are often made , and where a great deal of money is also lost.
(Source: TechCrunch)
