Destiny Tech100: A New Fund Offering Access to Private Tech Companies
A new fund called Destiny Tech100 has emerged, offering investors access to privately owned technology companies, including SpaceX, OpenAI, and Stripe. Since its launch in March 2023, the fund’s shares have experienced a wild ride, surging by over 200%, but also experiencing significant volatility.
The fund’s founder, Sohail Prasad, aims to provide wider access to pre-IPO companies, which are typically reserved for high-net-worth investors. Destiny Tech100 has attracted a significant following among retail investors, who have helped fuel its recent surge.
Concerns from Critics
However, the fund has also faced criticism from analysts and competitors. Morningstar has raised concerns about Destiny Tech100’s high fees and structure, arguing that investors would be wise to stay on the sidelines. ARK Investment Management, led by Cathie Wood, has also expressed concerns about the fund’s structure and fees, arguing that it results in a higher price point for investors.
ARK’s Competing Fund
ARK Investment Management has its own fund in this space, called the ARK Venture Fund, which debuted in September 2022. However, this fund has struggled to attract investors, resulting in higher ownership costs than originally estimated. ARK has since offered waivers and reimbursements of these fees.
Founder’s Response
Prasad, the founder of Destiny Tech100, has defended the fund’s structure and fees, arguing that it offers investors daily liquidity and simplicity. He also appreciates that ARK’s comments have helped educate investors about the concept of investing in private tech companies.
Conclusion
Destiny Tech100 has captured the attention of investors, but it remains to be seen whether its recent volatility and concerns from critics will dampen its momentum. As the fund continues to evolve, it will be important for investors to carefully consider the risks and rewards associated with investing in this unique fund.
