The entry to start ups is now fully open to the retail investor. Before VCX there were various vehicles that flirted with ownership for accredited investors and a small amount of direct retail ownership in private companies but VCX blew the doors off by taking their best fund and removing the restrictions on it bypassing accreditation.
Yes it’s getting the WSB treatment here but this undeniable success is going to make the peak special acquisition chamath days look like the flame from a lighter vs a full Australian Outback wildfire that’s about to happen.
Get ready for hundreds of copy cat funds to hit the market. The IPO on these things is going to continue to be insane for the foreseeable future
VCX just changed the market in a big way
byu/colorfort instocks
Posted by colorfort
5 Comments
That’s what retail needs! More funds investing in things with black box valuations! What could go wrong?
I don’t know much but a lot of the SPAC or private investment stuff does seem like a low-key scam for normal people, I don’t even feel confident choosing public stocks sometimes, and that’s even with the extra requirements to be a public company.
I will say there are times I wish I could invest in shares of specific privately owned companies that I think are good, but I think more growth into a good and robust platform for that might be needed. Basically be able to invest in private shares, but understanding that the shares don’t get votes, or the owners might make decisions in a way that public shares might not allow.
I wish I could short this thing
Accredited Investor criteria was created for a good reason. Public Reg A private markets like part of FundRise moved out of that criteria, and VCX skirts that entirely. The criteria itself ($1M investable assets or $200k income for an individual) hasn’t changed since 1982 (today that would be about $3.3M investable assets). Even before VCX that opened the door to investors putting money into stuff they may not be able to reasonably handle the risk on. People will get hurt, but I guess individual responsibility and all that jazz.
This thing is going to produce some legendary bags