In recent years, the landscape of venture capital has undergone a seismic shift, moving from a model that favored initial public offerings (IPOs) to one that increasingly relies on private liquidity. This transformation raises critical questions about access to wealth creation and the implications for everyday investors. Once, tech founders raced to go public, with the median tech startup achieving an IPO just five years after its founding in 1999. Today, that timeline has stretched to an astonishing 14 years, indicating a significant change in how companies approach growth and liquidity.
The implications of this shift are profound. In 2005, the combined value of the 50 most-valuable private U.S. tech companies was less than $5 billion. Fast forward to today, and that figure has skyrocketed to approximately $1.8 trillion. This dramatic increase reflects not only the maturation of private markets but also the growing concentration of wealth among a select group of insiders. As global private market assets under management have surged from a mere $100 billion in the mid-1990s to over $15 trillion today, the question arises: Should access to venture capital remain limited to the wealthy few?
Ben Miller, CEO of Fundrise, argues that the traditional barriers to broader venture capital participation—risk, illiquidity, lack of oversight, and high fees—are rapidly eroding. This perspective is particularly relevant as we stand on the brink of a new era in which transformative value could be created almost entirely within private markets, potentially widening the wealth gap between insiders and the general public.
One of the primary objections to democratizing venture capital has been the perception of risk. Historically, venture capital has been viewed as a high-risk investment, primarily associated with early-stage startups that may or may not succeed. However, Miller points out that late-stage companies such as Stripe, Databricks, and Canva resemble mid-cap public equities more than they do early-stage gambles. Investors can mitigate risk by constructing a diversified portfolio of late-stage funding rounds, allowing them to capture meaningful upside while reducing exposure to individual company failures.
Illiquidity has also been a significant concern for potential investors. Traditionally, venture capital investments have been characterized by long holding periods and limited opportunities for liquidity. However, the landscape is changing. The private secondary market reached a record transaction volume of $162 billion in 2024, demonstrating a growing appetite for liquidity in private equity. Furthermore, publicly registered venture capital funds can hold a portion of their assets in liquid stocks or Treasuries to meet redemption requests, effectively bridging short-term liquidity needs with long-term exposure to private growth.
Another critical factor in the democratization of venture capital is the increasing demand for oversight and transparency. New publicly registered, evergreen venture capital funds, such as the Fundrise Innovation Fund, are subject to rigorous regulatory requirements, including SEC filings, audited financials, and daily net asset value (NAV) disclosures. This level of transparency offers retail investors more insight into private markets than they often receive in traditional mutual funds, addressing concerns about oversight and accountability.
Historically, high fees have deterred many investors from participating in venture capital. The standard model of 2% management fees plus 20% carry has been criticized for disproportionately benefiting fund managers at the expense of investors. However, innovative models are emerging that challenge this norm. For instance, the Fundrise Innovation Fund charges a flat management fee of 1.85% with no carried interest, making it more accessible to a broader range of investors.
The momentum for democratizing venture capital is gaining traction, particularly in light of recent legislative developments. In June 2025, the House passed the Fair Investment Opportunities for Professional Experts Act with overwhelming bipartisan support, directing the SEC to open private markets to knowledgeable investors regardless of their net worth. This landmark legislation represents a significant step toward leveling the playing field and expanding access to wealth creation opportunities.
The scale of the opportunity presented by democratizing venture capital is enormous. As industries like artificial intelligence (AI) are projected to generate trillions in economic impact, excluding the majority of Americans from participating in this wealth creation is not only unfortunate but also unjust. The potential for private tech investments to provide diversification in an era when public portfolios are dominated by a handful of major players—the so-called “Magnificent Seven”—further underscores the need for broader access to private growth.
With approximately 60% of public equity assets held passively, denying long-term investors access to private growth opportunities feels increasingly arbitrary. The traditional barriers to entry in venture capital are becoming less relevant, and the case for democratization is stronger than ever. As the lion’s share of value is now created before companies go public, the urgency to open the doors of venture capital to a wider audience is palpable.
Publicly registered venture capital funds represent a breakthrough in this regard. By pairing regulatory oversight with access to innovation, these funds offer everyday investors a chance to participate in the upside of early-stage growth. Just as exchange-traded funds (ETFs) transformed public markets by providing greater access and liquidity, these new vehicles have the potential to reshape the future of private capital.
The arc of innovation bends toward abundance, and it is time for venture finance to bend with it—toward the many, not the few. As we look ahead, the question is not whether venture capital should be democratized, but rather how quickly we can implement changes that allow for broader participation in wealth creation. The doors to private markets are beginning to open, and with them comes the promise of a more inclusive and equitable financial landscape.
In conclusion, the evolution of venture capital from a model that prioritized IPOs to one that embraces private liquidity presents both challenges and opportunities. The barriers that once restricted access to venture capital are being dismantled, paving the way for a more inclusive investment landscape. As we stand on the cusp of this transformation, it is essential to recognize the potential for democratizing venture capital to create a more equitable distribution of wealth and opportunity. The future of wealth creation lies not behind closed doors but in opening those doors to all who seek to participate in the journey of innovation and growth.