Robinhood is introducing a publicly traded fund that invests in startups from Y Combinator. Shares are available for anyone to purchase.

      TL;DR: Robinhood Ventures Fund II is set to go public at $25 per share, targeting startups within the Y Combinator network. Fund I, which raised $315 million in its March IPO, contains investments in Databricks, Stripe, and Canva. The underwriting is being handled by Goldman Sachs, Citi, and JPMorgan, with a fee structure of 2% management and a 20% incentive fee.

      Robinhood is introducing a second publicly traded closed-end fund aimed at investing in private companies from the Y Combinator ecosystem. The Robinhood Ventures Fund II has filed to sell 7.6 million shares at $25 each, with pricing anticipated after the market closes on August 12. The fund will be listed on the NYSE under the ticker RVII. Underwriters include Goldman Sachs, Citigroup, JPMorgan, UBS, and Wells Fargo.

      This fund will focus on a diverse range of early-stage and growth-stage private companies that have gone through Y Combinator’s programs, which typically accept between 500 and 700 startups annually, producing notable companies like Airbnb, Stripe, and Instacart. The fund may also consider investments in firms outside of Y Combinator. The first fund, RVI, launched in March at $25 per share, raised $315 million, and includes shares in Databricks, Stripe, and Canva. As of Monday, it was valued at $25.50, reflecting a 2.8% increase.

      This structure allows retail investors to access equity in private startups via a stock exchange, similar to purchasing other stocks. The fee arrangement includes a 2% management fee and 20% on cumulative realized capital gains, reflecting a traditional hedge fund model tailored for retail investors. Moonshot is preparing for a $30 billion IPO in Hong Kong, and many major private AI firms are moving toward public offerings. This fund aims to provide retail investors an early stake in Y Combinator companies before they go public, which would typically be available only at IPO prices or later.

      Robinhood CEO Vlad Tenev will unveil the fund through the Robinhood app and YouTube on Monday, as the platform's mission has been to democratize stock trading. Publicly traded funds focused on private companies represent the next step in democratizing venture capital. Anthropic has also filed for an IPO this year, and with many AI companies preparing for public offerings, the fund's focus on Y Combinator’s portfolio could capture valuable pre-IPO investments across the sector. However, the challenge remains whether a 2-and-20 closed-end fund will resonate with retail investors accustomed to zero-commission trades, a risk Robinhood is willing to take.