Fundrise Innovation Fund
Score
3.5
- ClassCommon shares (Evergreen RIC)
- Managed byFundrise Advisors, LLC
- Release dateSeptember 1, 2025
- UpdatedSeptember 1, 2025
Net Asset Value
$140M(2024 -end)
Max. Offering Size
Unlimited (continuous offering)Investment Style
Venture capital(mid- & late-stage tech; some public exposure)
HQ Location
Washington,D.C. & New York, NY
Amount Raised
$100M+Legal Construction
Delaware statutory trustAsset Class
Venture CapitalInception
July 2022Eligibility
Accredited & non-accreditedMin. Investment
$10Annualized Distribution Rate
NoneNet Total Return
8.5%(inception to Aug 2025)
Distributions
None scheduledIncentive Fee
NoneAnnual Management Fee
1.85% of AUMHolding Period
Typically 5+ yearsAdvisor
Fundrise Advisors, LLCDealer Manager
Direct via Fundrise platformAuditor
Cohen & CompanyCounsel
Goodwin Procter LLPThe Bottom Line
Fundrise Innovation Fund promises access to elite tech companies like OpenAI, Databricks, and Anthropic with an 8.5% track record since inception, but here's what they don't highlight upfront: you're locked into a 3+ year minimum hold with 1.85% annual fees while betting on the same late-stage tech valuations. The returns sound compelling until you realize you barely beat the S&P 500 over 3+ years while giving up all liquidity and paying premium fees for access to companies that may already be overvalued.
The real story? While Fundrise Innovation beat bonds, cash, and REITs, it essentially matched stock market returns during a period when venture capital was supposed to shine. For millennials building wealth, this represents a speculative diversification play that could provide tech exposure but at the cost of tying up capital during your prime earning years for returns that don't clearly justify the illiquidity sacrifice.
Your Money vs. Reality
Period Analyzed: July 2022 - September 2025 (Fund inception to present)
Investment Amount: $10,000
Notes on Period: FTSE Nareit All REITs Index; Vanguard Prime Money Market Fund (VMFXX); 10-Year Treasury constant maturity; S&P 500 Total Return Index; SPDR Gold Trust (GLD).
Notes on Period: Analysis covers 3.17-year period from fund inception (July 2022) through September 01, 2025. Performance based on reported 8.5% annualized return since inception. (GLD).
Key Takeaways: Fundrise Innovation barely outperformed the S&P 500 by just $113 over 3+ years, raising questions about whether the illiquidity premium and venture capital complexity are justified. While it beat bonds, REITs, and cash significantly, the modest edge over stocks doesn’t compensate for losing complete liquidity during market volatility.
Fund Strategy
Invests in mid- and late-stage private technology companies (including AI and data sectors) with some public equity exposure. Structured as an evergreen venture capital vehicle, it seeks long-term capital appreciation through IPOs, acquisitions, or other liquidity events.
Fit Check
Available to: All U.S. investors (accredited and non-accredited)
Ideal For:
- Tech-forward investors seeking venture capital exposure with low entry minimums ($10).
- Those willing to hold illiquid positions for 5+ years in exchange for long-term growth potential.
Less Ideal For:
- Investors needing liquidity or access to capital within 5+ years.
- Those preferring liquid, low-cost alternatives for tech exposure via public markets.
Fast Facts
Key Concern
What It Means for You
Minimal Liquidity with Quarterly Limits
Your money is mostly locked with restrictive exit options
Late-Stage Tech Valuations May Be Inflated
Paying peak prices for companies near IPO during market downturn
Track Record Limited to Bull Market
Fund launched during favorable period, untested in downturns
Fees Erode Returns Over Time
1.85% annual fee requires outperformance just to break even
Pros/Bulls Say
- Access to exclusive private markets: Exposure to AI leaders like OpenAI, Anthropic, and Databricks with just a $10 minimum versus $1M+ VC fund requirements.
- Diversified venture portfolio: 20+ companies across AI, fintech, and data infrastructure reduce single-company blowups while capturing long-term tech megatrends.
- Evergreen holding structure: Unlike traditional VC funds that wind down, the fund can hold winners through IPOs and beyond, compounding returns over time.
Cons/Bears Say
- Challenging entry valuations: Investors buying late-stage tech companies may be paying peak multiples just as IPO markets cool from higher interest rates.
- Low relative performance vs liquid markets: 8.5% return to date is essentially equity-like, while locking investors into illiquid structures with no near-term liquidity.
- Untested in downturns: Fund has never endured a “VC winter,” when private valuations can collapse by 50–80% and remain depressed for years.
Verdict
3.5/5 — Fundrise Innovation opens the door to exclusive venture deals for everyday investors, democratizing access to AI and tech unicorns. But sky-high fees and unproven returns vs public indexes make it better suited for speculative capital, not core wealth-building allocations.
Fees & Expenses
Fee Type
Why It Matters
How Calculated
Typical Amount
Management Fee
Investment oversight and fund operations
% of NAV, accrued daily
1.85% annually
Other Expenses
Admin, legal, custody, accounting
% of NAV, passed through annually
1.34% annually
Acquired Fund Fees
Charged by underlying fund investments
% of NAV
0.19% annually
Total Annual Expenses
All-in operating cost
Sum of fees
(% of NAV)
(% of NAV)
~3.00% annually
Fee Impact Example:
- A $10,000 investment at 8% gross annual return over 10 years
- Would see returns reduced to approx. 5% net after costs, with ~$3,000 consumed by fees — nearly 40% of investor gains lost.
Portfolio Snapshot
As of June, 2025
Industry
Overview
ALIGNMENT: Average
- Flat 1.85% management fee avoids carried interest, creating better alignment than 20% profit-share VC funds, but managers still earn regardless of returns.
- Evergreen structure and capped liquidity provisions reduce investor leverage over underperforming assets, though quarterly withdrawals provide some balance.
Performance: Above Average
- 8.5% returns since inception barely beat public markets, questioning whether illiquidity and venture risk justify the premium.
- Performance is untested in prolonged downturns, with concentrated exposure to AI and late-stage tech companies at peak valuations.
Business Risk: Above Average
- Venture strategy is a departure from Fundrise’s real estate core, raising execution and learning curve risks in deal flow and exits.
- Heavy reliance on continued retail enthusiasm and regulatory stability leaves fundraising vulnerable if investor demand weakens.
Market Risk: High
- Venture valuations remain sensitive to rates, IPO freezes, and cyclical downturns, putting late-stage tech portfolios at correction risk.
- Concentration in AI and data infrastructure heightens exposure to regulatory pushback, competition, and shifting technology trends.
Debt Risk: Low
- Fund itself avoids leverage, keeping balance sheet risk modest, though portfolio companies face higher borrowing costs with rate hikes.
- Credit stress in private tech markets or refinancing challenges could hit valuations, but direct debt exposure to investors is limited.
Liquidity Risk: Above Average
- Quarterly redemptions are restricted by fees, caps, and delays, limiting timely access in stressful conditions or shifting portfolios.
- Illiquid private company holdings may lock investors in for years, with forced sales at steep discounts harming long-term value.
Transparency: Above Average
- Fund offers more visibility than most private funds, but portfolio-level data is quarterly, with little insight into decision-making or exits.
- Valuations rely heavily on internal estimates or outdated funding rounds, creating risk that reported NAV doesn’t reflect true conditions.
Manager Insights
The people running your money matter. Here’s what you need to know about this team:
Ben Miller
CEO & Co-FounderExperience & Highlights: 15+ years; Co-founded Fundrise in 2010; Built platform to $7B+ AUM and 2M+ investors; Real estate developer background; Disrupted crowdfunded real estate investing.
Education: B.A. Economics, Georgetown University.
Dan Miller
CEO & Co-FounderExperience & Highlights: 15+ years; Co-founded Fundrise in 2010; Operations and technology leadership; Built scalable investment platform infrastructure; Real estate development expertise.
Education: Graduate from the Wharton School with a B.S. and M.B.A.
Peer Comparison
Vehicle
Fundrise Innovation Fund
ARK Venture Fund
The Private Shares Fund
Min. Investment
$10
$500
$2,500
Holding Period
Permanent Capital
Permanent Capital
Permanent Capital
Total Annual Expense
3.00%
2.9%
2.72%
Inception Date
July, 2022
Sep, 2022
March 2014
Net Returns Since Inception (Annualized)
8.5% (since inception to Aug-end, 2025)
17.1%
+7.92% (through March 31, 2025)
NOYACK® Score
Disclaimer
All Rights Reserved. The data and analyses contained herein are the property of Noyack and are protected by copyright and other intellectual property laws. The information provided is intended solely for informational purposes and should not be construed as investment advice. It is not an offer to buy or sell a security, and it is not intended to be used as the sole basis for any investment decision. The information contained in this document is believed to be accurate and reliable based on sources believed to be reliable, but Noyack makes no representation or warranty, express or implied, as to its completeness, accuracy, or timeliness. The data and analyses are subject to change without notice and Noyack is not obligated to update this information. The use of the information contained in this document is at the sole risk of the reader, and Noyack shall not be responsible for any losses, damages, or expenses incurred by any person as a result of reliance on the information contained herein. Noyack does not endorse or approve any investment or trading strategy and does not guarantee any specific outcome or profit. The reader should always conduct their own independent analysis and consult with a qualified financial advisor before making any investment decisions. This document may contain forward-looking statements and projections which are subject to risks and uncertainties, and actual results may differ materially. Past performance is not indicative of future results. This document is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Noyack reserves the right to modify or discontinue the provision of the information contained in this document, in whole or in part, at any time and without notice. The information contained in this document is provided “as is” and Noyack makes no representation or warranty of any kind, express or implied, as to the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of the information contained in this document. Noyack shall not be liable for any errors or omissions contained in this document or for any damages whatsoever arising out of or in connection with the use of this document.
