Transcript
0:00 Greetings, everyone. my name is Cathie Wood. I am CEO and CIO of ARK Invest. And today we have a very special guest. Shiv from Robinhood here is CFO of Robinhood, but he is also spearheading a very important effort, we believe, at Robinhood, and that is in the private space. And we've structured our funds differently, as you know. ARK has ARKVX, that's our venture fund, and it's roughly a $750 million fund right now. And RV1 is Robinhood's new fund.
0:42 so, it's just out of the gate. and we were comparing notes, Shiv, as we heard rumors of what you were doing, and I remember approaching you and just saying, you know, why don't we talk about this a little bit? We're doing this differently, and but I guess the first the first thing we should talk about is our shared DNA as companies. I know that I founded ARK really to democratize access to transformative companies that we didn't think were well represented in the broad-based indices out there. and we did so with what we call an open-source research ecosystem, basically giving our research away in order to educate and inspire investors and others.
1:41 so, I I think we have a common bond in that way. >> Yeah, no, I absolutely. And first, thank you for having me, Cathie. Love the idea of sharing more with retail and comparing notes and structures, and so super excited to be here. I think you nailed it on the head. We have a shared DNA. Robinhood's mission is to democratize finance for all. And every single product we built is around that mission. And so when we thought about private markets, we said we want to do for what we did for the public markets for the private markets, meaning give everybody access, no minimums, no jargon, meet them where we are. We actually took inspiration from what you did when we were doing our initial research and we were looking at the best-in-class out there. So So thank you for being a vanguard. And I think the more people that are advocating for retail, the more people that are trying to change the industry, the better. So yeah, we super excited to to follow in your footsteps and to also be part of the the revolution.
2:38 >> Yeah, and having grown up in the industry, it has been very institutionally driven over the years. And one of the reasons I founded Arc was, you know, after the tech and telecom bust and then '08, '09, the global financial crisis, we saw the institutional world really becoming very risk-averse and looking very much like the broad-based benchmarks in terms of the way they approached investing, you know, using these benchmarks as their screen instead of using research, which is our screen, and which is more of Robinhood's screen because a lot of your retail investors are investing in in the companies like Tesla because they've tried the product and they're evangelizing for the product and so forth.
3:44 >> Yeah, I I think the way we think about it is everything that you look at is retail is getting more engaged, they're continuing to do deeper research. They're continuing to support the equity markets. And so, when people come to us and say what should our retail strategy should be, we say that you should treat them the same way you treat institutional investors. These are investors that love the product. They do deep research. They have long-term holding periods. They want to They want to hear from management. And so, what's really exciting for us is that Robinhood was able to help bring them have a seat at the table. And that started the public markets. And now what we're trying to do is have that exact same mentality and bring it to the private markets as well.
4:22 >> Yeah, what what's interesting, two companies, Tesla and Palantir, they start their earnings calls, at least the Q&A portion, with retail because they think retail gets what they're doing and retail is a more loyal shareholder base than institutional. So, I found that very interesting, especially because we're in a world of so-called accredited investors.
4:58 Those are the Those are the investors who are allowed to invest in private companies. For most venture capital firms require accreditation in order to let investors in. And of course, that means, and please correct me if I'm wrong on this, but I think it means at least $1 million in financial net worth and roughly $250,000 per year in income. >> The system needs to catch up for what's going on today.
5:31 When they originally set, they thought a wealth-based metric was good to say investors were sophisticated. I think today with the proliferation of knowledge and intelligence, that is antiquated. And so, what it ends up doing is wealthy investors are are to get even more wealthy by investing in some of these private companies early where where the everyday investor is left out. So, it's one of our big policy initiatives to help change the rules. For example, you could have something that's knowledge-based. You could have any customer, whether regardless of your wealth, take a test. If you understand the risks and disclosures, you should be allowed to invest. For us, we stand for access. We don't want to be paternalistic. We do want customers to understand the risks and understand what they're getting into, but to exclude people just because they don't have a a wealth threshold we think is antiquated.
6:17 And so, that is one of the things that has kept people out of private markets. Now, with the the fund structures that you have and that Robinhood has, we are able to get around that. But if you really want to democratize the system, you need to change the accreditation rules as well. >> Right. And I think one of the reasons they need to change is companies are staying private longer. It's unbelievable that SpaceX has somewhere between estimated 1.5 and 2 trillion-dollar valuation, let's say, when it goes public this year. And non-accredited investors have had very limited access to it.
6:58 We certainly tried to change that. And I know you'll be changing this as well as RV1 evolves here. But, you know, you listen to the SEC the head of the SEC now, Paul Atkins. I think he understands. Look, there are half the number of public companies today that there were maybe 25 or 30 years ago because many companies are staying private. They don't want all of the rules, regulations, and really more so, I would say, the bureaucracy associated with being public these days.
7:40 Now, hopefully he changes it so we get more balance, but in the meantime, you know, there are huge companies building in the private markets. >> Oh, yeah, absolutely. So, if you go back in history, Amazon, Apple, even Google and Facebook, some of the largest companies in the world, they went public at hundreds of millions or single-digit billions. Today, you don't see that anymore, and what happens is the everyday retail investor is left out, and the early growth accrues to a small group of institutional investors. And so again, I I don't think that's the best way for society. It's not good for the system.
8:16 To your point on companies being public, we believe every company should be public. It is a way to get access to capital. It is a way for investors to learn more about you. The system is not set up that way. I think the new SEC is doing a really good job of looking at the rules and should they be modernized and actually giving companies a seat at the table to share what's broken. Companies are choosing to stay private because they can. There's a proliferation of capital. It's res- less onerous. But if you change the system such that being public is easier again, that the disclosure requirements, the bureaucracy goes down, I think more and more companies would do it. So, yeah, I think what the the new SEC administration look at looking at is is is very good for the long-term system, but in the interim, there's a lot of these private companies that are going to continue to stay longer, and if that hap- private for longer, and if that happens, retail is going to continue to be left out.
9:11 >> Well, there's another thing that's happening in in terms of private for longer. We're seeing companies, the most sought-after companies, are are becoming parts of SPVs, special purpose vehicles, which incur fees, and sometimes there are second layer and third layer. So, you know, the chosen few get get an allocation in these private deals and then they start selling off chunks to others who add fees and then again and again. And I know the SEC is looking at that, but that is you know, not a good thing for the end investor, especially if a retail investor somehow becomes involved in in those kinds of structures. So, I think more transparency is will be very welcome here and and is very needed because again, these fees upon fees are something that many investors, accredited or non-accredited, they are not aware of.
10:22 >> Well, yeah, 100%. This is what happens when you make it harder to go public or harder to access capital, you create these shadow markets. And then you have these interim players. And to your point, you have intermediaries that charge fees. They're not transparent, they don't have disclosures, which is why it would be better if the companies would just go public. They wouldn't have intermediaries, they would have real disclosures. And so, if you fix that, that will get rid of this by layer. But all this is is a is a symptom that the system is the the current system is not working. And retail and even institutional investors are hungry to get access to these companies. And so, they're going through and doing it in ways that they may regret later. Again, having high fees, not really understanding what they're buying. And so, yeah, we think it would be much more beneficial to remove those from the system and just have a more transparent way of buying private markets. One thing I'll note, it was really important to us, one, that we did it right by the company, but two, we did it right by the customer, so they understand exactly what they're doing. and so, that was something a little bit different than than other funds we've seen in the market.
11:22 >> Very much so. In fact, we've seen some of the funds out there have SPVs in them. and in one case, I know that the management team had no idea that it's equity or was inside an SPV which was inside a public fund. So, that was interesting as well. So, let's talk about our our structures.
11:53 They're a little bit different. They're accomplishing the same thing. We are 95% plus direct to cap table. And and so are you, which you just discussed, and I think that's very important. We know our management teams. We are modeling these companies. and we've put them in an interval fund. and I know that RV1 is a closed-end fund. So, maybe we'll start with you describing why you chose the closed-end fund, and then we can talk about the puts and takes of interval versus closed-end.
12:36 >> Yeah, absolutely. So, there's a lot of different vehicles for customers to get access to these type of assets. So, they are all in a broader form of what are known as the 40 Act funds. These are registered public vehicles that have been around for decades. Elerman Atkins of the SEC actually said these are the best vehicles for retail customers to get access to them. So, I think regardless of if it's a it's a closed-end fund or interval fund, these are very good vehicles for for retail to get access to them. The reason we chose closed-end fund is a couple different ways.
13:07 what it means is first we start with the customer pain points. So, when we talk to customers, what are what are they most frustrated about? one, that they don't have access. Two, that they need to be accredited. three, they would like liquidity. That is really important for the the retail investor. and so when we structure the vehicle, that's what we were trying to solve for. We were indifferent to which path that it it actually went through. And when you look at the closed-end fund, it does all of these things. So, it's listed on the New York Stock Exchange because of that, you don't need to be accredited, just like buying an ETF or a single-name equity.
13:40 it has daily liquidity because it trades, and anybody, whether you're accredited or not, can have access. So, that's the main pros. There are a couple cons, which I think you know, you can say that the pros outweigh them or not, but we are fully aware of those. First, you raise a pool of capital up front, hence the name closed-end fund, but after that, you can't take in capital or not. And so, even if investors want to put in more or not, the pool that you raise up front is what you have for the the foreseeable future.
14:08 The second main downside is it can trade at a premium or discount to NAV. So, NAV, or your net asset value, is what they the value of the assets are worth. Because it's exchange-listed, if people think the assets that you own are more valuable than the current NAV, they can pay more. If they think it's worth less, they can trade less. And so, that can sometimes be confusing to customers. Either you're buying in at a higher valuation than the NAV, or you're buying at a discount. They want to know why.
14:34 But again, we looked at the pros and cons, and we thought having the ability to have no accreditation, daily liquidity, and access outweighed them. However, I know in in the interval fund, you can solve some of those points. so, I'd love to hear how you were thinking about it and and some of the pros of the interval fund as well. >> Yes, well, we were looking at some of the early closed-end funds and noticed that they were selling at significant pre- premiums or premia.
15:02 and even today, one out there is selling at six times the net asset value. Another one selling at close to 50% higher than the net asset value. Those are probably the two most popular ones out there. and we we thought that was an issue. Now, I know that your solution, rightly so, is education, education, and transparency.
15:33 those are your your brand hallmarks, to be sure. and so it is much less of an issue for you, which is which is great. I I noticed there was a just a very small premium the last time I looked. and there's a lot of disclosure around that, as well. so, in the interval funds case, it will always be at net asset value. And we are our pricing committee is looking every day for events or other signaling to change the net asset value.
16:11 So, but as you say, while we have access and we are direct to cap table, unlike some of those other funds, we do not have liquidity all day long. we have daily inflows and these are on platforms. the first one was Titan, an Andreessen Horowitz-funded direct-to-consumer company. SoFi was another one. Now, we're on Schwab, Fidelity, Pershing.
16:48 So, the the the the venues are proliferating here, which is fantastic, because there is demand pull for what we're doing. Nonetheless, daily inflows, but only quarterly outflows. And the reason for that is, while we are an evergreen and public-private fund, meaning 80% private, 20% public. So, we do have liquidity there. we felt that it given the nature of private companies and the long-term time horizons that investors must have in order to move into this kind of asset, that the messaging would be clearer if we said, "Look, only quarterly redemptions and even then only up to 5% of NAV." So, an easy way to understand that is to imagine a an investor in our fund represents 3% of the fund and is the only investor who wants out of the fund at the end of a quarter, that investor will get all his or her funds out of the interval structure.
18:10 But, if if an investor wanted out and everybody else wanted out at the same time, then they'd probably get a minimum, I'll say, of 5% of their assets out. so, this our structure is not completely liquid, clearly. but, it is true to this concept of l- a long-term investment in a private asset that is focused on innovation and may take time to really scale.
18:50 I think I I think we've captured the differences, yes? >> Yes, I I think you captured it really well. the pros of the interval fund, as you said, is you can have always trading at NAV, which I think is a a really nice feature, and you can offer the customer some liquidity. It may not be daily liquidity, but it could be quarterly, as you said, and it may be a a smaller portion. but you need to match the asset and liabilities of your fund. If you're investing in long-term transformational companies, you don't want to be forced to sell every day or every quarter. So, I think that's really important. A closed-end fund accomplishes something similar. Because the pool of capital is closed, money can't come in or out. So, we can hold long-term private assets.
19:32 what we give up is we don't we don't trade at the NAV. It can trade at a premium or discount. So, again, just different ways to approach it. I think both are really good for retail. I think for us, what you said at the beginning, disclosure, transparency is key. We worked really hard with our product engineering team to make sure that any closed-end fund, not just ours, but others in the market, the customers knew what they were buying. You can see the NAV on any day. You can see if it's trading at a premium to discount. If it's trading either way, we have a disclosure that explains what it is. You can click into the fund and understand the underlying assets. So, again, I think both structures work for for the retail customer. It's just trying to get what you're what are the pros and cons, but either way it provides access and it makes sure that you can hold these private assets for a long duration of time.
20:19 >> Yes, and before before you launched, we were trying to reason through why would we, for example, consider a closed-end fund? And and under what conditions, I suppose. And we were looking at these very large premiums from these other funds, not yours. And we're saying, "Okay, if that happened to us, what would we do?"
20:50 and I don't I don't know if if this makes sense, but our thought was, "Okay, we would open up the fund again to allow others in and bring that premium down. Would that make sense as a solution? >> Yeah, absolutely. So, if if you look at our prospectus, we actually list this as you know, there is a risk that the fund could trade at a premium to discount, but there are ways to mitigate it. And one thing you said is exactly right.
21:22 Let's say the fund trades at a very large premium, meaning people think the assets are going to be worth more in the future than they are today, you can raise additional equity in the fund. The same way you would if you were at an operating company. If you're doing well and there's strong investor demand, you can raise more equity. What happens in that case is you do dilute existing shareholders again, whether you're a fund or an operating company, and you would bring the premium down, but I think that would be a very natural solution. that way you provide more people more access, and then you'd have more capital to invest in the companies as well.
21:54 >> Yes, and as you say, it would be like a company operating and and doing very well, so much that there was a sharp increase in its price. Very often when that happens, a company will issue new shares as well, and bring supply and demand more into balance. So, definitely understand that, and and I think it's great that you're educating your investor base as well to that possibility.
22:25 now, maybe another topic to discuss because we've both had experiences now approaching founders. And I'm sure you've gotten different reactions when when you go to a founder and say, you know, we would like to provide access to our investor base to your to this opportunity that you clearly have identified and are executing against beautifully. so, you go, you know, with great compliments and saying, "Hey, our investors really want access to what you have."
23:08 what have their reactions been like? >> Yeah, it it's been a journey. So, we've been at this for about 9 months now. It's a lot of education. companies want to understand does it impact my valuation, do I have to share any disclosures, will it become a shadow equity trading my fund? Once you go through that, we've been in your shoes before having been a late stage private company and understanding the pain points and people start to understand it, then they get excited. Okay, well, tell me more about it, you know, what really resonates with companies, especially these companies, they can take capital anybody in the world, these are the best frontier companies, is that it's a differentiated product, whether it's coming from Arc or Robinhood, there not many vehicles where you can truly give access to retail. If you're a consumer brand, it's very powerful, you know, Robinhood for example, 27 million customers that can use your product and get to know you. Even if you're an enterprise company, just getting into the vernacular, into the cultural zeitgeist, to be part of that, I think for a lot of companies it's really resonated. The part that I'm most proud of is the early companies that we have in there. They are now telling other CEOs and management teams, "Hey, you should consider this, this is great for the for your customer base, this is great for the economy."
24:21 And so, when we first started, it was a little bit of pulling teeth, it was a lot of education, a lot of a lot of sharing what the pros are, but now it's resonating and companies are actually going and and advocating on our behalf. The other fun thing we're seeing and I'm sure you see this in your funds as well, the underlying retail customers are now advocating. So, they're going on X or other platforms and saying, "Hey, we would love to be part of your company." And they're going directly to the founders and asking if they can participate. And so, you're starting to see the momentum build. so, it it's been a fun journey and I think there are still companies that want to watch and wait and see and we say that's fine, but every single day we're actually getting outreach now. Where companies are coming to us and say, "Hey, we'd love to learn more. Can we participate? Would you like to be an investor in us?" So, it's been a really fun change.
25:07 how is how is your journey been getting to know the companies? I know you guys started a little bit earlier than we did. >> Yes, we started about 3 and 1/2 years ago. And at the time we really yes would go to founders and we had set up a wish list because our analysts are our analysts' responsibilities are broken out by technology, not by sector, not by industry, but by technology because we think these whether it's robotics, energy storage, AI very importantly, blockchain technology, or multi-omics technology in the life science space. We think these technologies are going to scale across sectors and become mass market opportunities, which I know is music to your ears because of your retail investor base as well.
26:03 so, we went to the founders initially and said, "You know, we're just starting out. We're trying we're trying to democratize access to the technologies around which we have centered our research and investing. we'd like to show you some of our research. And the odds were very high we found out even when we were just cutting checks in the 25 to $50,000 range, which seems which seems ridiculous now. It's unbelievable we were able to execute. Now we're cutting checks in the you know, anywhere from the 10 to 50 million dollar range.
26:43 but even back then founders were very welcoming and we found the reason was that they often were using our research from big ideas. Big ideas we put out every January. They were using our research from our our big ideas in their pitch decks to help investors size the opportunities they were going after. So that's not what they do as companies.
27:15 What they do is heads down, innovate, move fast, break things, maybe hopefully not. fail fast and start over again. but they're not sizing markets the way we are. And so they welcome that. They had already We're of course as long as they give us attribution, we were quite happy to be in their pitch decks. So from that angle, it was very much better I would say than we expected.
27:46 And it showed showed me how much respect these founders have for our research and our willingness more importantly our willingness to give it away. The other side of this because we've cultivated relationships with the venture capital community as well. Charlie Roberts who leads our venture effort came out of a unicorn and knew that world very well. and so we've worked both angles and I have to say we've felt more welcome a few exceptions but we've felt more welcome in this world than I expected given that the traditional venture capital world is so closed and so highly networked. So have to give them credit there and as I said with just a few exceptions and I know we've talked about exceptions but we'll win them over because we're doing the right thing. I think that's the most important point here is we are doing the right thing and I think that the founders I think get it before maybe the venture the lead venture team, but they're beginning to influence one another right now. So maybe we're all headed to the same place. What do you think?
29:11 >> I I think it's a great point. So for the way you approach it is you gave the founders something differentiated. Original research something they can use. I think that's what really resonates with founders. From the Robinhood side it's access to 27 million customers, a brand halo, getting to know the markets much earlier. But regardless of what you're providing, you need to be differentiated. You can't just come in and say we want to be another form of capital and I'm glad that it's resonating with founders both from the original research or also with the ability to to reach retail earlier.
29:41 Your point on the VCs, I think it's a fantastic point. The advantage we had is we're in Silicon Valley, Sand Hill is 5 minutes away. All of the biggest investors were investors in Robinhood when we were private and they've actually been really helpful in in our new initiative. So yeah, I was I was surprised as well. Everyone's competitive, you're all working towards the same companies and you want to invest, but a lot of our earlier investors, whether it's Andreessen Horowitz or Thrive or Sequoia or Ribbit or DST or Green Oaks, all of them have been really supportive in helping us get access to companies and and advocating for us and telling the founders, "Hey, you know, Robinhood does things the right way. You should at least hear them out." And so to your point, I think people realize we're just growing the overall pie. The more people that are focused on providing capital and helping the economy innovate, even if it's competitive, is going really well. And so yeah, I think I've been pleasantly surprised both from the the founder side, but but also from the VC community welcoming us in as well.
30:41 >> Yeah, and I think one reason we've had this response and you as well is we are not going to be sitting on boards the way traditional venture capital teams are. ours is a much more is a different model. What we are doing is providing the research out there, elevating the companies in terms of visibility in the retail world. and you know, the retail world is important. These are their customers for many companies, right? These are their customers and we we learned even though Tesla was a public company in the early days, it was very hard for Tesla to get institutional interest. They it Tesla wasn't in in a benchmark. it seemed like a a wild wildly speculative company. And yet and yet the research we were doing brought retail along. I think that many were there already cuz they owned the cars, so they had done their own research. But then we added another layer of research which added to their comfort in buying Tesla stock because for every naysayer in the institutional world, we would have some research saying, "No, that's not correct and here's the data."
32:17 And the one I love the best, remember, I remember and it was 2018-19 when Tesla was going through production hell and I was on one of the news programs facing you know, facing a debater who who basically said, "Well, Tesla's going bankrupt." And I said, "Really?" So, this was manufacturing. I said, "You think a company run by a person who has just landed two rockets on a barge in the ocean is not going to be able to manufacture an EV?"
32:58 So, it was just a very simple way of thinking about it, but it caused some aha moments. I I think actually retail ran with that more than institutions. But they came along, especially after Tesla entered the indexes. I think what I'm trying to say is both you and we trying to bring investors along before it's really obvious that they're great success stories because there is so much value accretion before these companies will enter the public markets or enter an index.
33:41 >> Yeah, 100% whether it's retail or someone like yourself or someone like Robinhood, these companies are doing amazing things, and sometimes you have to have a very long time horizon, and institutional investors or even the public markets don't always have that time horizon. But if you use the product, if you do original research, if you allow people to really understand how big it could be, I think that's what gets retail excited. The other point you brought up up front is for the companies, we are more akin to public market capital. We don't take board seats.
34:14 We don't get certain information rights. We want to make sure that we are there to help, but we are also treating them the same way a public market investor would be, and I think that's a little bit different, and that resonates with them. But the converse is, you can also help them if you have a certain area of expertise. So, ARK, for example, you can provide original research. What we have is we are a deep operating company.
34:35 We've been around for 10 years. We're an S&P 500 company now. So, actually, some of the companies we've invested in, I've talked to their management teams, and they've said, "Hey, Shiv, we're working on a certain project, or we're trying to look at how we can do IRRs for marketing, or we're trying to look at how you do annual planning. Can you give us some advice?" And so, again, like, it's just something differentiated. We're an operator, and and we have a venture capital arm inside of that. So, we can provide some operating experience to these companies.
35:02 You have an investment management arm, but you have original research for the companies as well. What you want to do is just provide something of value to the companies, and once it resonates with them, they're more open to taking your capital. And so, we're seeing that something that's that's been really helpful as well. >> Yes, and and we are very happy shareholders of Robinhood. Just amazed at your product velocity, and you know, how how quickly you're responding to, you know, the retail demands out there. The more you do, the more they want.
35:36 And you definitely are delighting the consumer and the investor. congratulations for making it into the S&P 500. It's it's a a very big deal, and a lot of institutional investors were waiting for that moment, of course, to even consider you. And that's, again, an interesting way of investing is probably just a safer way of investing, but it also leaves on the table, as I mentioned before, tremendous value accretion. so, just one final way of thinking about retail versus institutional, you know, in in the day, retail money used to, and this was probably institutional talking, used to be considered dumb money. And institutional, the smart money. I think the tables are turning and and dumb and smart are not the words we should use, but retail is discovering new opportunities and willing to invest earlier than institutional.
36:50 And therefore, enjoy more of the value accretion over the years. >> Oh, yeah. So, one thing that we see with our customers is they tend to be techno-optimists. They tend to have long-term time horizons. They tend to buy companies that they know and love. They tend to really like frontier technology companies. So, I think there's a little bit of a a misnomer about, "Oh, you're a Robinhood customer and you're a trader." To the vast majority of our customers are buying hold investors. The other thing we tend to see is they tend to be net dip buyers. So, when a stock goes down that they love, because they have such a long-term horizon, they actually tend to be net buyers. And so, you actually support the stock during those periods of of volatility.
37:34 And then on the way up, if a stock does well, they're very happy to trim the position and go back in at another entry point, because again, they have a long-term time horizon. So, while some people say retail can cause volatility, when you actually look at the data, and we have copious amounts of data, being around for 10 years and 300 billion plus of assets, retail can actually be a volatility dampener. Because they buy you on the way down, and then on the way up, they can actually reduce their position. So, it's a little bit counterintuitive to what you said before.
38:02 Our average customer today, our median, 36 years old, they tend to be married, tend to have two kids and a dog, widely distributed across the US, educated, more diverse. These are the customers. These are the ones who are using the products. These are the ones investing in you. And so, yeah, I I think it's important to have both institutional and retail, but I think customers and companies need to understand what is retail mean? Retail are people that are doing research, long-term time horizons, techno optimist. So, from our from our standpoint, I think companies should be welcoming these folks and helping educate them and doing what you're doing and what we're doing to give them a long-term seat at the table.
38:42 >> Yeah, it's interesting. ARK invests very much like your investor base does and and many people know this because we post our trades at the end of every day and they will see that we buy low and sell high. Whereas, in the institutional world and this shift towards quantitative research and factor-based investing, they actually they actually follow momentum.
39:14 they follow they buy into rising price momentum. They buy into rising or an acceleration in growth. They're they're looking to follow actually. They're looking to follow. That's not necessarily bad, especially if a stock has miles to go. but in a world in the world of innovation where there is a lot of volatility, you they can they can fall into a trap of buying high and selling low just because they are so momentum driven. And you know, what I find interesting about that is many retail investors are you know, accused of being just momentum oriented and you have the statistics to prove that that is not true and we certainly are in that camp as well. Again, it's a it helps the liquidity in the market.
40:12 >> Well, yeah, abs- absolutely. another place we see it that's really interesting where retail provides support is actually new IPOs. So, there's a lot of talk about IPOs and how much retail participate and and you know, we very famously gave a very large portion of our own IPO to retail and now other companies are starting that. we've done close to 50 IPOs on our platform and what we see is retail actually does a very similar thing to what for non-IPOs. Meaning on day one retail tends to be net buyers on our platform. So, for nearly every single IPO that we've done on day one retail actually bought more.
40:49 And so, you often get the same assumption that oh, retail is going to be a flipper or they're just going to sell it or they're in it for the short term. What we actually find is they hold it longer than institutional and that they buy it on day one and and then if they if the company does well, they continue to buy more. And so, I think there's a lot of these misnomers whether it's about you know, if you're already public or you're going public. But what we actually see in the data is retail is a strong supporter of both new IPOs and also companies once they go public.
41:18 and so, very excited to see more companies you know, giving access and allowing retail to participate. >> Yeah, and maybe we'll we'll end on this note. for the reasons that we've just stated and actually that you just stated Shiv many companies are looking to us as they were as they are thinking about an IPO and we're in a world where the physical world and the digital world or embodied AI is taking off and needs huge amounts of capital. and so, we're going to be there for them and they know it and they they are beginning to come to us now as they are looking towards IPOs to do some late-stage funding to get more visibility in the market and and particularly in the retail market. So, it's pretty exciting to to see this come full circle in a way. You know, we thought we'd be blocked and and most people were from the private world for a very long time. And now there's an awakening. Wait a minute, there's this investor base that is quite complimentary to the one we have in place now. and will serve a very useful role in terms of our increasing our visibility, maybe attracting helping us attract more talent as they evangelize, and in our case do research about these companies.
42:58 So, I'm pretty excited about the future, Shiv. >> Yeah, no, likewise. I think you nailed it. whether it's, you know, investing these companies when they're private in the funds, helping them go public, or then supporting them when you're public, we are at the beginning of what looks to be a, you know, innovation supercycle across all the different industries. And so, we are so excited to support them on both their capital needs and their and getting to know their customers and and and yeah, we're we're hoping to to keep doing more. So, thank you for helping lead the way, and we're excited to be a partner, and and see if we can also be part of the journey as well.
43:35 >> Oh, I think we will. I think we will. Ever since I saw in I'm going to say well, certainly 2020, but even before that, 2017, some some of the activity we saw on Robinhood in our funds really helped grease the skids and and have helped make ARK what it is today. So, thank you, Robinhood. Thank you, Shiv, and excited to be on this private market journey with you as well.
44:09 >> Awesome. Thank you, Kathy.