Retail brokerage Robinhood announced plans to launch a fund that would give individual investors access to a basket of private companies. The initiative is positioned as an effort to address persistent imbalances in access to capital markets.

However, the structure has drawn comparisons to the initial coin offering (ICO) era. Though the fund will be regulated, it carries several material risks.

Opening Private Markets To Retail

Robinhood formally announced its Robinhood Ventures Fund I (RVI) on Tuesday, anticipating that it would go public on the New York Stock Exchange (NYSE) in the coming weeks under the symbol RVI.

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The fund is set to offer exposure to a range of private companies, including Revolut, Oura, Ramp, Databricks, Airwallex, Mercor, and Boom. Robinhood also plans to broaden the portfolio over time, adding more private firms, including Stripe.

According to the press release, customers can request initial public offering (IPO) shares of RVI through Robinhood at $25 per share. 

Unlike many traditional private market vehicles, RVI is structured to be available to a broad range of investors without accreditation requirements or minimum investment thresholds. The fund charges a management fee but does not impose performance fees. Its shares are expected to provide daily trading liquidity, subject to market conditions.

“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.

However, the move has generated skepticism about the underlying risks of indirectly investing in private companies. For crypto veterans, the structure echoes a familiar dynamic seen during the ICO boom.

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Lessons From The ICO Collapse

RVI provides retail investors with exposure to private growth companies, a segment of the market historically dominated by institutional capital. The fund is an SEC-registered, exchange-listed vehicle operating within established securities laws.

However, its underlying holdings are private companies whose valuations are based on infrequent funding rounds rather than being constantly priced by the public market. The companies’ reported value may not fully reflect changing market conditions until a new funding event forces a reassessment.

RVI is also a closed-end fund, meaning investors cannot sell their shares back at a guaranteed price. Instead, shares trade on the stock exchange, where the price can rise above or fall below the actual value of the companies the fund owns. 

As a result, investors face two layers of uncertainty: the underlying private-company valuations and the market price of the fund. The use of leverage could amplify gains but also magnify losses during market stress.

Structural risks of this nature were most visible between 2017 and 2021, during the rapid expansion of ICOs.

During that boom, retail investors gained direct access to early-stage ventures, often driven by forward-looking narratives despite uncertain valuation frameworks and liquidity timelines.

By 2018, many ICO-funded projects failed to deliver viable products or sustainable revenue models. Token prices collapsed as speculative demand faded and regulators intensified scrutiny, wiping out billions and leaving retail investors with losses.

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The episode exposed weaknesses, including limited disclosure, information asymmetry, and heavy reliance on optimistic growth assumptions. While some projects evolved into legitimate networks, the broader ICO cycle became associated with valuation excesses and uneven risk distribution.

This structure does not make RVI equivalent to an ICO, but it helps explain why comparisons have emerged.

When High Valuations Limit Upside

In both cases, retail investors can access high-growth opportunities that were once largely restricted to institutions, even as transparency around valuations and exit timelines remains limited.

The key concern raised by critics is not regulatory oversight, but risk distribution. 

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When access expands without continuous price discovery or guaranteed liquidity events, investors may face prolonged capital lock-up, sudden valuation adjustments, or exposure to elevated entry prices.

Some skeptics have also pointed to the fund’s specific composition. Several of RVI’s highlighted holdings, including Stripe, Databricks, and Revolut, have recently raised capital at valuations of $140 billion, $134 billion, and $75 billion, respectively. 

Focusing on companies already valued very highly may leave less room for strong future gains. It could also increase the risk of price declines if private-market conditions weaken.

Others contend that traditional venture capital strategies often seek earlier-stage opportunities, where valuations are lower, but growth asymmetry is higher. 

In that framing, critics shift the debate from access to timing, arguing that retail investors are entering private markets after valuations have already climbed rather than before major growth takes places.