Sean D. Emory
Founding Partner & CIO of Avory & Co., Avory Foundational ETF (AVRY)
VCX's collapsing premium to NAV signals that AI euphoria is deflating. The Fundrise Innovation Fund's NAV is $18.97; its price peaked at $380, about 20x NAV, and is now ~$76, still a rich 4x. That premium assumed NAV would keep rising with a static list, but Anthropic has overtaken OpenAI, with Databricks close. Anthropic can justify some premium; OpenAI is less certain. Nvidia, up only ~4% in six months, sends the same signal. This is not a call for the story to end. x.comÂ
The Fundrise Innovation Fund looks wildly overpriced, trading at a premium to NAV never seen before. The listed fund offers access to private companies investors want but cannot otherwise own, and its price went parabolic in just four days. x.com x.comÂ
Diversified cash flows in the billions make the AI-buildout basket more appealing than standalone model companies. Many members look reasonably priced and have longer records of delivering returns; Anthropic and OpenAI look much more like gambles at current valuations, though either could appeal at the right price. A possible equal-weight portfolio to revisit in five years includes Amazon, Alphabet, Microsoft, Meta, Oracle and SpaceX. x.com x.comÂ
Fundrise's VCX fund, which owns Anthropic, OpenAI and SpaceX, could squeeze higher as those private giants keep getting rerated almost every week. Its chart is flagging and getting very tight. x.comÂ
Fundrise Innovation Fund is a story rather than a position for playing Anthropic and the AI race. It trades at a 14 times premium to its net asset value, and its lockup expires in September. Owning what the AI race actually pays for, such as Nvidia, TSMC, Broadcom and Corning, is the better trade. x.comÂ
The Fundrise Innovation Fund looks like a greater-fool trade: after rising 1,288% this month it trades at roughly 20x NAV, a 1,500-2,000% premium. Its holdings are weighted toward Anthropic, Databricks, OpenAI, Anduril and SpaceX, so buying it is like paying $34 trillion for SpaceX or $16 trillion for OpenAI. Shorting is impractical given its very low float and lack of options for hedging, but buying in means playing hot potato. x.comÂ
VCX should keep rising during Anthropic's IPO marketing on retail hype, with every update touting the deal as 100x oversubscribed and indicated to open far above its initial range. x.comÂ
Fresh funding for AI expansion supports a continued bid for AI stocks as compute spending shows no sign of slowing. Meta committed to $95B in shareholder dilution for AI, Anthropic is set to have $200B in cash in a couple of weeks, and SpaceX got a $40B Apollo loan solely to buy more Nvidia GPUs. The Anthropic IPO might even be a positive catalyst rather than the negative one many fear. x.comÂ
AI-exposed semiconductors face near-term demand risk as Anthropic's revenue growth slows. Monthly additions fell from $10B to ~$2-3B, though October may improve and one-off headwinds contributed. The AI selloff is not irrational amid rates, debt, politics and supply-chain risks. Despite long-term optimism, a short-term bull case needs an Anthropic IPO or OpenAI fundraise, calmer rates and debt funding, blowout cloud earnings with EPS upgrades, and new applications reviving token monetization. … Show more
Apple's roughly 35x forward earnings premium looks unsustainable. If fear around the AI trade fades, its gains could stall or reverse. x.com x.comÂ
VCX trades at a premium to its holdings that the market is wrong to sustain. Per @JoshKale, the fund trades at $565 against a net asset value of $19 a share, about 30x, so a $650 million portfolio of private companies such as Anthropic, OpenAI, SpaceX, Databricks and Anduril is valued at nearly $10 billion; $546 of each share is pure demand premium. x.comÂ
