The Fundrise Innovation Fund (VCX) has plummeted following a hype-driven rally that pushed shares up 1,840% on its March 19 listing. VCX is a closed-end fund, offering retail investors access to pre-IPO tech giants like Anthropic, SpaceX, and OpenAI. VCX peaked at $575 per share amid retail frenzy but has since crashed over 68% from those highs.
Claim 30% Off TipRanks
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Discover top-performing stock ideas and upgrade to a portfolio of market leaders with Smart Investor Picks
Yet, the fund trades at a steep premium to its net asset value (NAV) of $18.26. Investors have paid massive premiums, sometimes running over 31 times NAV.
VCX’s top five holdings include:
- Anthropic – 20.7%
- Databricks – 17.7%
- OpenAI – 9.9%
- Anduril – 6.9%
- Ramp – 5.1%
The Hype Behind VCX’s Rally
VCX’s meteoric rise stemmed from its rare exposure to private tech disruptors and buzz around potential SpaceX and Anthropic IPOs, akin to meme-stock frenzies. Low trading volume amplified retail buying, pushing shares far above typical closed-end fund discounts of 10-20%.
VCX’s rapid rise and fall is not surprising, as it has happened before with a similar fund, Destiny Tech100 (DXYZ), launched in March 2024. It is a closed-end fund that also invests in private tech. DXYZ surged to $105 in initial hype, far above its NAV of roughly $5, but now trades at around $26, with NAV at $19.97.
Why the Premium Shrank
Selling pressure on VCX hit on March 26 after short-seller Citron Research flagged lockup expirations for 100,000 retail holders. Shares plunged 59% in a single session, touching lows of $182.
The stock slid further, including a 30% intraday drop, and 10% after-hours decline. Consequently, the premium shrank to 11 times NAV as IPO mania faded, following typical closed-end fund patterns where temporary hype evaporates.
Should You Invest in VCX?
We used TipRanks’ Technical Analysis Tool to assess the outlook for the Fundrise Innovation Fund. The tool indicates a “Buy” consensus, with nine Bullish indicators, against four Neutral and three Bearish indicators.
