Cathie Wood's Ark Investment rose to prominence over the last several years by making bets on high-growth tech stocks. Now, the firm wants to help open venture capital investing to individuals.
Ark Investment is launching a new venture fund with a minimum initial investment of $500. The fund will be made available exclusively on Titan, a fintech startup backed by General Catalyst and Andreessen Horowitz.
The Ark Venture Fund plans to construct a portfolio that is 70% early- and late-stage private companies and 30% public technology stocks. The firm will also invest selectively in other venture capital funds.
The fund's initial private investments include Epic Games, Flexport and Chipper Cash, according to a tweet by Clayton Gardner, Titan's co-founder and CEO. Ark did not reveal how the fund intends to source VC investments. The firm did not respond to a request for comment.
Venture capital is one of the most high-risk asset classes. The difference in returns between the top and bottom performing funds has historically been larger for VC than for all other private market asset classes, according to PitchBook data. Therefore, investors' return expectations will depend on Ark venture fund's ability to invest in strong startups.
Wood rose to prominence after her firm's actively managed ETFs soared in popularity in 2020 and 2021, part of an investment craze that targeted high-growth tech companies. But the firm's flagship fund is down 61% this year, hurt by interest-rate hikes that have tempered growth expectations.
Wood is the most high-profile investor to try to democratize venture capital, an asset class normally restricted to institutional investors and wealthy individuals. Other attempts to make startup investing available to non-accredited investors haven't gained popularity.
Unlike traditional venture funds, which typically seek a 2% management fee and 20% carried interest, the Ark Venture fund will charge its investors a management fee of 2.75% and other costs of up to 1.47% during the first year of the fund's operations.
Featured image of Cathie Wood by Marco Bello/Getty Images
This article originally appeared on PitchBook News
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Cathie Wood's Ark courts retail investors with new VC fund
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