Robinhood Markets plans to open access to private artificial intelligence companies through Robinhood Ventures Fund I. The closed-end fund will target at least five private AI firms and sit inside the Robinhood Ventures unit. It aims to give retail investors exposure to fast-growing startups that usually remain limited to institutional and accredited investors.
The fund structure limits redemptions, so investors may not exit their positions quickly. If many investors try to withdraw at the same time, they could face delays or discounts. The company positions this feature as part of a long-term strategy rather than a short-term trading product.
Chief executive Vlad Tenev has argued that everyday investors want exposure to the AI trend despite higher risk. He has also downplayed concerns about an AI bubble, noting that Robinhood customers already allocate significant capital to AI-related assets. Management continues to warn that investments in early-stage companies can lose all their value.
The launch of Robinhood Ventures Fund I fits into the broker’s broader push into new asset classes. Robinhood already offers trading in stocks, options, cryptocurrencies and prediction markets. The AI fund adds another growth lever while also increasing the firm’s exposure to volatile sectors.
Robinhood reported third-quarter revenue of $1.27 billion, doubling from a year earlier and beating Wall Street estimates. Diluted earnings per share reached $0.61, and adjusted EBITDA margin improved to 58%. Strong trading activity supported the results, led by a 129% jump in transaction revenue.
Robinhood crypto revenue grew 300% year over year, while equity revenue rose 132% and options revenue increased 50%. Average revenue per user climbed to $191, up 82%. The company now counts 11 business lines that each generate more than $100 million in annual revenue, which reduces reliance on any single product.
Despite these figures, HOOD stock fell about 11% on November 6, its steepest one-day decline since March. The investors were focused towards softer-than-expected crypto revenues, which is a key sentiment driver. Furthermore, a lower-than-forecast tax rate increased the earnings, causing an inquiry about the quality of the beat.
The management increased its cost expectations for 2025 due to the growing investment in prediction markets and the Ventures franchise. Increased planned expenditure, coupled with weakness in crypto assets on the same day , put strain on the share price. Despite the pullback, the stock is up over 200% in 2025 and trades at approximately 17% below all-time highs.
Equity analysts reacted to the earnings release and stock drop by lifting their price targets. Those who updated models on November 6 raised targets by an average of 13%. Their new average target of about $157.50 implies roughly 24% upside from recent levels.
Wide coverage indicates more moderate expectations. MarketBeat data indicates a consensus target of just over $132, while TipRanks includes a Moderate Buy rating based on 13 Buy, five Hold, and one Sell recommendations. Analysts point to rapid revenue growth, growing profitability, and diversification in multiple lines of business.
At the same time, they continue to flag valuation risk and regulatory uncertainty, especially around crypto trading and marketing to younger investors. The transition into private AI investing may further increase customer engagement at Robinhood, but it also brings new liquidity and risk-management challenges to retail traders.