Robinhood’s Private Markets Bet: RVI IPO Opens Door to SpaceX, OpenAI Hype

The trading app is taking its biggest swing yet at democratizing private equity, just as retail sentiment cools and crypto headwinds bite.

• RVI is a closed-end fund that provides retail investors with exposure to a concentrated portfolio of private companies, including Airwallex, Boom, and Databricks.
• Robinhood said customers can request RVI IPO shares through the company at an expected price of $25 per share.
• RVI will be paying a quarterly management fee to Robinhood Ventures, the investment adviser, at an annual rate of 2% of net assets.

Robinhood Markets Inc. is set to launch its first private markets fund, which is expected to go public in the coming weeks on the New York Stock Exchange and would provide retail traders with access to high-profile IPOs this year.

This move comes ahead of major public offerings from SpaceX and OpenAI and provides retail traders with access to large-cap companies that have seen soaring valuations. The company’s Robinhood Ventures Fund I (RVI), the first fund from Robinhood Ventures, is expected to list on the IPO under the ticker RVI.

RVI is a closed-end fund that provides retail investors with exposure to a concentrated portfolio of private companies, including Airwallex, Boom, Databricks, Mercor, Oura, Ramp, and Revolut, with additional companies expected to be added over time.

Details of RVI

Robinhood said customers can request RVI IPO shares through the company at an expected price of $25 per share. The company said it has agreed to buy shares of Stripe that it expects will close after the IPO. 

“Opening up private markets will resolve one of the greatest longstanding inequities in capital markets today, and we’re excited to bring these opportunities to all with Robinhood Ventures Fund I,” said Robinhood CEO Vlad Tenev.

Robinhood said that RVI was accessible to all investors, with no accreditation requirements, no investment minimums, a competitive management fee, and no performance fees.

RVI will be paying a quarterly management fee to Robinhood Ventures, the investment adviser, at an annual rate of 2% of net assets. Robinhood said that to further lower costs for investors at launch, the management fee is reduced to 1% for the first six months immediately following RVI’s public debut.

Wall Street On HOOD

Shares of Robinhood have declined more than 33% so far this year, mainly driven by weakness in bitcoin and the company’s quarterly results, which highlighted its cryptocurrency segment not doing much better.

Cantor Fitzgerald lowered the firm's price target on Robinhood to $100 from $130, according to TheFly, which implies a 33% upside to the last closing price. The firm said that while the market volatility is likely to persist in the near-term, Robinhood retains several levers, including prediction markets, tokenization, international markets, and retirement that position the company to continue driving growth in less favorable market conditions.

Mizuho said the company's fundamentals are under pressure as the "crypto winter" continues to take its toll on fourth-quarter profits, and added that it believes Robinhood remains better positioned than Coinbase.

What Is Retail Thinking?

Retail sentiment on Robinhood dipped to ‘neutral’ from ‘extremely bullish’ a day ago, with message volumes at ‘normal’ levels, according to data from Stocktwits.

A bullish user noted that the stock could reach $200 following the private fund news.

In the last 24 hours, retail message volumes on Stocktwits jumped 173%, and over the past month, the ticker saw a 3% spike in followers.

Shares of Robinhood have gained more than 27% in the last 12 months.

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