Shorting Fundrise Innovation Fund (VCX) — a Real-time Trade Breakdown

Hello everyone.

I know I said I wouldn’t trade anymore but then when I witnessed VCX trading to $350 yesterday, I stupidly tweeted this:

I consider myself a man of my word. When I tweet something like that, it locks in a trading plan in my head and if I don’t followthrough, I look like a chicken. So it did find a 4-handle today (and a 5-handle, for good measure) and now I am short. I kind of hate myself for doing this but I do think it’ll work out… but we’re not at that point yet in the post where the result of trade is clear, so this is now a real-time trade breakdown.

A little background–I used to be a Fundrise investor!

So in August 2020, I became a Fundrise investor. I bought into their Flagship Real Estate Fund.

Well, not me, exactly but legally, it was my money. It was actually my wife who made this decision. She was getting really big into financial self-help books, we had a lot of cash on the sidelines, and she learned about Fundrise in a blog called Financial Samurai. She plowed some money into both Fundrise Real Estate and index funds. ¹We talked it over of course and I was cool with it.

For a couple of years, it quietly delivered—steady, dependable, and seemingly low-risk.

Then rates surged, with U.S. mortgage rates pushing toward 8%. Real estate fell out of favor while equities kept ripping, and the Flagship Fund started to look like a lagging, underperforming asset.

Meanwhile, in 2024, as I started digging deeper into private tech and pre-IPO opportunities, I realized Fundrise had already launched an Innovation Fund packed with leading AI names. It actually debuted in 2022—but since the newsletters were going to my wife’s email, I was late to the party.

Switching probably made sense. I’d soured on the real estate fund and was all-in on private tech. But you couldn’t just click a button to make that happen. Flagship’s redemptions were quarterly. It wasn’t a big position anyway, so we let it sit. “Diversification,” blah blah. By mid-2025, I was done looking at the underperformance and I was quickly stockpiling more and more SPV’s. We redeemed the whole thing. I was already building my own private tech portfolio and owned most of the Innovation Fund’s top holdings anyway. So there was no use for it for me. Bye bye, Fundrise.

I didn’t think I’d hear much about them again. Until now.

The VCX IPO

As I was writing about my Adventures in Private Investments post, I wanted to add some background on the pre-IPO landscape. It’s historically been pretty closed off, but there have been attempts to democratize access for smaller investors, with Fundrise being one of the more notable players. So I mentioned them.

Then VCX went public. And KABOOM. 400% move on day 1. Keep in mind the NAV was publically disclosed at $20. That’s already nuts. Then it just kept going. $200. $300. Then $400 and $500 today, peaking at $575.

So the timing of my post couldn’t be better as everyone started to pay attention to pre-IPO, my new wheelhouse.

It’s funny, I remember posts on the Fundrise subreddit complaining about the fund going public. They voted against it. They called Ben Miller a sellout. They thought it would trade at a discount to NAV because of short sellers. People on Reddit don’t know shit.²people on Reddit also thought RDDT was the ultimate short at IPO. then it went from $30 to $200

Now there’s a post on the Fundrise sub about BUYING MORE TODAY. At 1600% NAV. I was super tempted to copy/paste/tweet it and be the smarmy guy who says “lol @ guy, that’s the top.” I do think it is the top. But I won’t be that guy, I hate those guys too, those fucking know-it-all contrarian types.

The Elephant

You know what really sticks in my craw?

Why the fuck was I not buying this IPO for a quick flip? It seems like such a no-brainer in hindsight. I already knew about the fund. I’m so obsessed with pre-IPO tech and I think it’s the next frontier of amazing returns in the next 2-5 years. This fund has all the right names–OpenAI, Anthropic, Anduril, SpaceX, Databricks–I’m literally writing about all these companies and I own almost all of them!

It reminds me of that Michael Platt quote.

“I don’t have any tolerance for trading losses. I hate losing money more than anything. Losing money is what kills you. It’s not the loss itself but the fact that it messes with your psychology. Then the elephant walks past while your gun’s not loaded.”

I haven’t lost money recently but I’ve been in such a sour mental funk with trading. It just got worse and worse and worse and so intolerable that I stopped doing it. Then the best organic idea ever passes by my crosshairs and I forget how to shoot while the elephant walks past me. FUCK. FUCK. FUCK!

So now what I do now with my big galaxy brain? I’m going to fucking short this thing while it trades at 1600% of NAV. It’s a thin piece of shit that barely trades 1mil in volume–exactly the type of low float stock that makes me nauseous. I’m going to do it because I tweeted something.

GODDAMNIT.

Shorting VCX because I’m stupid

Here’s my elaborate trading plan–I go to my computer screen. I locate shares of VCX at .06. My support staff tells me the interest rate is -80%³(annualized)–which honestly isn’t that bad. I was expecting another zero.

VCX opens at the bell–ding ding ding-a-ling. I squint really hard. I make a wild guess. I push the button. Boom, first 5 mins, I’m short at 425.

Then I get run the fuck over for another 150 points.

The old Pete would make fun of traders who short stocks like this. Haha look at this slow idiot “scale in” with his “starter position” while it’s still in the parabolic phase. He has no idea how to time anything. Just gets in and holds with no stop and risks a basis point like a portfolio trader. LAME.

Whoops. Good thing I only did 100 shares. I was honestly just too scared to go bigger. I’m very self-aware of how washed I am–and thank god for that. That’s really the only part of this trade I commend myself for. At least I know I suck and I didn’t try to get too big against a freight train.

At 11am, the stock feels heavy. I start slipping into that familiar self-loathing, wondering why I ever came back to trading. Size doesn’t matter. Long, short, big, small. It all hits the same. The old feelings creep in. I get obsessed with the outcome. Every good part of the day just evaporates. Replaced by the same tired, obsessive, toxic loop in my head. It’s all back again. I just have to sit there and take it.

I’m just holding. I don’t even know if I’ll get out if VCX breaches the highs again. Maybe I can convince myself I don’t have to given my position sizing. I go to the gym.

While I’m at the gym, literally minutes after I get there, it plunges. Goes to a new low of 358. I’m a little relieved. Okay at least you don’t have to debate stopping out anymore, that should hold as today’s high. Then I’m a little hard on myself–idiot, why aren’t you trading the setup and adding there? Literally just wait for that moment rather than random entries.

The rest of the day unfolds and it’s boring as fuck. Nothing happens.

It even goes back to 500 again. I’m shaking my head. Idiot why not cover the washout and re-short it here? Why hold like the slow piece of shit that you are?

Whatever. Still 100 shares.

Then it goes back to $400.

Ok fine. I think that’s something. I add another 100 shares. I’m effectively at the same price still–425. It closes at 380. Seems to be done. I think it’s done. It’s not a good closing candlestick. The price action seems bad, right? Someone agree with me, please?

It bumps up another 10% afterhours and I’m hard on myself again. Idiot why not cover the close and just take the profit? This was such a miserable experience, you could’ve got out green. Why do you have to be a martyr for the bigger move?

I wasted my entire day obsessing over this thing. It’s not even close to an amount that would kill me if I lost, nor satisfy me if I won. Yet I feel like shit.

I’m picking up my 2 year old at daycare and I’m checking prices on the train. My daughter says something cute about the subway stops but I ignore it–not right now sweetheart, daddy’s short position is squeezing again.

I’m complaining to my wife on text–daytraded today. ABSOLUTELY SUCKS, I’M SO TIRED. can you please give her a bath tonight? xoxo love you

She forwards me a text from my father-in-law who drove our car to the dealer for an auto inspection today. There’s a rat’s nest under the hood. DISGUSTING.

As I make dinner, I feel wired on pent-up rage like a junkie. I want to scream. I’m pissed at myself for a garbage entry, pissed that I have to hold this thing for days to make it worth it, pissed that there are rats in my car. My shoulders are wrecked from being glued to the desk. Just a brutal reminder of everything toxic I thought I left behind.

Ugh, anyway

Once I close this position out, I’m never ever doing this again. I got a measley 200 shares at 425 average. I’m risking to the 575 high so that’s $30,000 maximum risk. I’ve lost that much while eating breakfast before. I doubt I’ll even wait for the high if the price action doesn’t stay in my favor by either tomorrow or Friday. I think that’s the all-time high this stock will never, ever break through, and if it somehow does, then it’s a strong sentiment signal for my much larger private portfolio anyway, so I still end up winning—just in a different way.

I think this will trade down -50% from the highs within a few days and then back under $100 by lockup expiration. It’s DXYZ all over again, but on steroids. Give me a cover at low $200s and I’ll be happy. Although with how I feel about my positions these days, I might be out even earlier just so I don’t have to pay attention anymore. I will post my exit when it happens, win or lose. Who even cares? This is all bullshit.

Please don’t buy up here r/Fundrise people. Happy for you OGs who are up nice on paper but I’d look for a way to hedge ASAP.