Fundrise Growth Tech Fund, LLC (NYSE:VCX) is one of Jim Cramer’s stock calls while he discussed the confusion surrounding the Trump-Iran conflict. Cramer mentioned the company during the episode and stated:
The Fundrise Innovation Fund… is invested in 28 different companies. And even if you just look at the top 10 holdings, you see a much more desirable list of companies… See, there’s one big difference between the public launches of the Robinhood Fund and the Fundrise Fund… The Fundrise Innovation Fund… did not offer any new shares with its listing. This was more of a like a direct listing where a company simply lists its existing shares on exchange rather than offering new shares to the public. And look, almost everyone who owns shares in the Fundrise Innovation Fund locked up. They can’t sell for six months because they’re not offering new shares either.
The vast majority of VCX shares are not free to trade, and the Fundrise Innovation Fund has an artificially low float. Only a little more than 10% of the shares are not… locked up right now. That’s a sliver. So basically, investors saw that there’s this new vehicle, which can give them ownership stakes in white-hot private companies, and they are, like Anthropic, Databricks, OpenAI, and SpaceX, and they want to buy, they want to buy it badly, but there are very few sellers because of the lockups. That’s also why I think you’d have to be crazy to buy the Fundrise Innovation Fund up here.
Keep in mind, all closed-end funds are forced to publish their net asset value at regular intervals. That’s their accounting of what the underlying assets are worth. At its latest accounting, the Fundrise Innovation Fund says that its net asset value per share was just under 19 bucks. So, at its current price of $315, VCX is trading at over 16 times its NAV. That is pure lunacy. Bear in mind, the stated net asset value already accounts for the appreciation of shares in the private companies that Fundrise purchased at much lower valuations… So if you’re buying VCX shares here at $315, you are betting that the value of the fund’s stakes in private companies is actually worth more than 16 times what the fund itself says they’re worth. Not realistic.
A stock market chart. Photo by Arturo A on Pexels
Fundrise Growth Tech Fund, LLC (NYSE:VCX) is a NYSE-listed vehicle that provides everyday investors with exposure to elite, late-stage private technology firms.
While we acknowledge the risk and potential of VCX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than VCX and that has 10,000% upside potential, check out our report about this cheapest AI stock.
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