Robinhood’s venture fund closed a $75 million investment in OpenAI, the company announced Wednesday, presenting an opportunity for traders to invest in the AI giant for the first time ahead of an anticipated stock debut.
Key Facts
- The Robinhood Ventures Fund I closed the investment into OpenAI—which has yet to go public—on April 17, Robinhood said Wednesday, adding that private markets have been “out of reach” for everyday investors “for too long.”
- While this doesn’t allow direct investment in OpenAI’s stock, Robinhood’s investment lets traders buy into a venture fund with indirect exposure to its value.
- Retail traders have access to OpenAI shares through other funds, like famed investor Cathie Wood’s ARK Invest, though investors also have some exposure to OpenAI through Microsoft, which holds a major revenue-sharing agreement with OpenAI.
- Shares of the venture fund, which trades on the New York Stock Exchange under the RVI ticker, rose 8% as of Wednesday morning.
Big Number
$852 billion. That was OpenAI’s post-money valuation after a $122 billion funding round in March, the company announced, after another $110 billion funding round a month earlier. Robinhood’s investment is small compared to OpenAI’s larger funding rounds, representing less than 1% of OpenAI’s latest valuation.
Surprising Fact
Last year, Robinhood offered tokenized shares of OpenAI and SpaceX to its users in Europe, briefly fueling the company’s stock to an all-time high. OpenAI condemned the move, however, arguing the tokens did not represent equity in the company and that OpenAI did not partner with Robinhood. “Any transfer of OpenAI equity requires our approval,” the company said, adding it had not approved any transfers.
Key Background
Demand for retail investment in OpenAI has surged in recent years, dominating markets. An expected IPO from OpenAI is among the most anticipated debuts, and chief financial officer Sarah Friar said earlier this month that the company saw “really strong demand” from individual investors. A public offering is expected as early as later this year, CNBC reported, as OpenAI plans to spend some $600 billion over the next five years developing semiconductors and data centers.
This article was originally published on forbes.com and all figures are in USD.
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