USVC is a new fund being offered by Naval, it's been discussed widely on X. I have some thoughts and why people should look into it. I have no connection with it and not being paid to shill.
Back when I started dating my wife, I told her to set up a Roth IRA and buy Apple. Every year, I'd have her put the max limit into a Roth IRA and buy Apple. Apple was $20 or so. When I checked it earlier this year, I was blown away. It was a small mount of money that grew into something nice.
Apple, Facebook, Nvidia, Tesla, etc. would IPO early. You could have MASSIVE outsized gains if you were investing in the early 2010's.
You couldn't get into them pre-IPO unless you had a connection. There are people on this site who pretend to be geniuses because a friend hooked them up with a tag-along investment into the seed round of Uber. It was a bro favor, good for them, they do leave that part out tho and let the false narrative of being a genius investor flow through.
You used to be able to buy in pre-IPO with a small check. Now it's almost impossible unless you have a friend, and they set up an SPV, they are usually doing you a favor, because huge funds and institutional investors gobble it all up. (This has also lead to the VC class screwing themselves over, because if you can't buy today's version of Apple at $20, because all the big gains are sucked up before the public offering, then why do you have buy in into this entire system?)
You could, as a small investor, get huge results pre-IPO via a small check, or also do well after the IPO, because companies IPO'ed earlier. Ie Apple at $20, Amazon in the 20's, etc.
It's very hard to get big gains now, because companies remain private much longer. Many companies don't want to IPO and then deal with the hassle of lawfare. Look at what happened to Elon in Delaware.
For us, as an ordinary person, this means that by the time a company goes public, we are "last money in." This is why I always tell friends and family to buy SPY (or FXAIX) and QQQM. Don't day trade. You won't beat the market. (Everyone who claims they do are lying, they use a short timeline and never mention all of the losing trades. Or they are insider trading or beating the market by a relatively small amount. For most of us, day trading is the way of death.)
With USVC, regular people can get into some of the companies that will IPO, eventually, at high valuations still, but pre-IPO.
I've read all of the negative commentary about the fund. I don't understand the "illiquid" complaint. If you started your own business and bought equipment, you wouldn't be paying yourself. If you really had to expand, you might not pay yourself for years. When you put your money in, it's locked up, you grow out the company for several years. Hopefully you can afford to pay yourself after a couple of years. If you QSBS'ed it, maybe you sell in 5-10. Who knows. In the meantime, yes, your money is gone. Every business owner knows this feeling. Your company is "worth" some amounts on paper, and you pay yourself a salary to live on. That's if things are going well.
There's also a lot of discussion around carry and fees. The question is will those fees be less than what the post-IPO price of the companies will be is. That's up to everyone to decide for themselves.
In any case, I have no financial interest into this fund. I am not telling you to buy into or not.
I do like to flag stuff like this for people who read me, operating under the rule that, "Cerno writes for the version of Cerno who did not understand any of this stuff, but sure would have liked to have." As an example, I didn't know what QSBS was until it was too late. [Frown face.]
And I didn't buy Tesla at $2 [panic attack], despite wanting to, because a financial adviser friend told me, "You shouldn't invest on a feeling, you don't have any edge here."
I would tell my prior self: You can't invest EVERYTHING based on vibes, but you can and should absolutely do so now and then. (Note: If you have an addictive personality, this is bad advice. But I am only addicted to X and See's Candies.)
But I will post the negative comments about the fund. I don't want anyone to ever read me and obtain bad information.
Everyone has to decide for themselves what to do.
I've also learned from experience that if something goes well, nobody sends me money or a box of cigars as a thank you. It was their brilliance that led them to the big gains. If it goes wrong, then the fault is all mine and people hate me for it.
That's also why I don't even want to post about the fund at all, but here goes.