We recently introduced you to the Fundrise iPO (internet public offering), a wholly unique ownership model whereby individual investors on Fundrise are given the opportunity to become investors in the company itself.
Because this type of private, earlier-stage investment is not typically available to most investors, it is common to have some questions. Below are answers to some of the most frequently asked questions we receive about the Fundrise iPO.
What exactly am I investing in?
When you invest in the Fundrise iPO, you are purchasing shares of Rise Companies Corp., the parent company and owner of Fundrise.
How is the Fundrise iPO different from a traditional IPO?
The Fundrise iPO is an internet public offering (not an initial public offering) where we are selling shares in the parent company as part of an early stage investment. This is different from a traditional IPO (Initial Public Offering) in that Rise Companies Corp. is a private company that is still in its high-growth, start-up stage, making this investment more akin to a venture capital or growth equity investment. The shares are being sold directly to investors and there should be no expectation that the shares will be listed on a stock exchange or publicly traded.
Is this related to the Innovation Fund (NYSE:VCX) listing?
The short answer is no. The Fundrise iPO is an offering of private, illiquid shares in Rise Companies Corp (the parent company of Fundrise) and this offering is not related to the NYSE publicly traded Innovation Fund, ticker symbol VCX. Fundrise is the manager of VCX and earns fees as a result.
How do I make money?
Your returns will be based on the change in the value of the company over time and will only be realized if and when the company experiences a liquidation event such as “going public” through a traditional IPO or the sale of the company.
While we believe the long-term market potential for Fundrise is substantial and our traction to date demonstrates our performance trajectory, it’s important to remember that this is an investment in a private technology company that is not cash-flow positive, yet. Investors should not expect to receive any distribution or current return, there is no guarantee of profit, and investors may be subject to a partial or total loss of their investment.
How long should I expect to hold this investment?
The Fundrise iPO is meant to be a long-term investment and is illiquid. Unlike our real estate funds and the Innovation Fund, the Fundrise iPO does not expect to provide the possibility for redemption, and investors in the Fundrise iPO should be prepared to hold the investment indefinitely until such time as the Company experiences a liquidation event (which liquidation event is not guaranteed), as described previously.
What is the current price per share?
The current price per share for the Fundrise iPO is $15.90. You can view a historical record of the share price, as well as additional key metrics we report on regularly, all on the offering page.
How much can I invest?
Investments in the Fundrise iPO must be made in whole shares. The investment minimum is one share and the investment maximum is $250,000.
When and how can I invest?
We expect to make the iPO available to you for investment later this month.
When the offering becomes available to you — don’t worry, we’ll send you an email — you will be able to log in to your account and place an investment from the iPO offering page. There will be a notice on your account overview if you lose track of the link.
Note: Any Fundrise iPO investment will need to be funded with new money from your external bank account. You cannot transfer any of the value of your existing portfolio into iPO investment.
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If you have a question that wasn’t answered here, you can simply reply to this email or reach out directly to our team at investments@fundrise.com.
The Fundrise Team