Robinhood (HOOD) Moving deeper into private markets with a new venture capital fund designed to give everyday investors access to companies before becoming public.
The company has submitted to Securities and Exchange Commission (SEK) An initial registration statement to launch Robinhood Ventures Fund in (RVI)A closed investment vehicle aimed at buying efforts in private companies that are leaders in their industries.
The fund managed by a newly created subsidiary called Robinhood Ventures would be traded on the New York Stock Exchange pending regulatory approval.
Robinhood was facing criticism earlier this year after it announced that it offers users in the European Union’s access to private equity -tokens.
The company opened access to these tokens through tokenized shares in Openai and SpaceX, while also launching its own LAG-2 blockchain network for users in the European Union to have access to tokenized listed US shares.
At that time, the company was forced to explain that its private equity tokens was held by a vehicle for special purpose after Openai warned that tokens did not represent the equity of the company. The company is still pushing forward by offering private equity access to retail investors.
“For decades, wealthy people and institutions have invested in private companies, while retail investors have been unfairly locked out,” said Robinhood chairman and CEO Vlad Tenev.
Robinhood pointed out that the number of public companies in the United States has fallen by almost half since 2000, while the private market has been ballooning to over $ 10 trillion in estimated value, according to Federal Reserve data.
If approved, Robinhood Ventures Fund I would invest in a small basket of private companies across different industries and keep them through stock exchange listing and beyond. Shares would be available to buy and sell through traditional brokers.
Robinhood shares have fallen 1.4% in today’s trade session to $ 113.39.
