ARK Venture Fund 3rd Quarter 2026 Update

Market Backdrop

Last quarter, US equity markets hit record highs even though interest rates increased sharply. Before a September pullback, the S&P 500 and Nasdaq 100 Indexes set all-time highs, ending the quarter up ~2% and ~2.5%, respectively. Leadership remained AI-focused and narrow: the equal-weight S&P 500 Index finished the quarter down ~2%, while the small-cap Russell 2000 Index declined more than 7%. Meanwhile, the 10-year Treasury yield rose 85 basis points¹ to 5.29%, 54 basis points of the surge in September, the largest monthly increase in four years.

For the first time since 2023, the Federal Reserve (Fed) has pivoted to hiking rates, raising its targeted Federal funds range rate by 25 basis points to 3.75%–4.00% on September 16 and signaling the potential for another increase this year. Contrary to conventional expectations, equities rose on the news, perhaps because investors welcomed the Fed's resolve and independence under Chairman Kevin Warsh. 

In our view, the official inflation data on which the Fed is relying overstates inflation. In August, inflation as measured by headline and core Personal Consumption Expenditures (PCE) was 3.4% and 3.0% year-over-year, respectively, while Truflation's² real-time measures stood at 2.6% and 2.1% year-over-year by the end of September. Energy is masking deflation elsewhere: gasoline and other energy goods prices have increased ~37% year-over-year, adding ~0.7 percentage points to Truflation's headline reading. If the Strait of Hormuz reopens fully, oil prices could fall sharply. 

Warsh's five task forces—three of them focused on inflation measures, inflation frameworks, and productivity—suggest Volcker-like discipline and an openness to alternative measures of inflation. A softer-than-expected August PCE inflation report at quarter-end, followed by a September payroll gain of only 29,000, has cut the odds of another hike in October to less than 20%,³ which sent the Nasdaq 100 Index to an all-time high. In our view, equity markets are viewing the increase in interest rates as less an indicator of inflation and more an indicator of accelerating real growth fueled by innovation.

Meanwhile, technology is unleashing deflationary undercurrents: AI inference costs—or the cost for OpenAI, Anthropic, Grok, Muse, or Gemini to answer questions—have been dropping more than 99% per year. Unlike that during the Global Financial Crisis, this deflation is “good,” as it is accelerating the growth of unit demand and revenues dramatically. ARK’s AI platform thesis is unfolding faster than expected: Anthropic's annualized revenue run rate (ARR) soared more than seven-fold, from $9 billion last December to $65 billion in July, and could top $100 billion by year-end, with much higher-than-expected profitability.⁴ In seven months, Anthropic added more annualized revenue than Salesforce did in 25 years, countering the "AI hype" narrative. Even so, according to our research, the impact of AI is in early innings, given projections of autonomous mobility scaling from single-digit billion dollars of revenue today to $10s of trillions during the next five to ten years, as well as the convergence between multiomics sequencing technologies and AI that is creating profound applications: curing disease and extending healthy human lifespans.

That convergence has surfaced in the recent performance of ARK's multiomics portfolio holdings. The ARK Genomic Revolution ETF (ARKG) returned 29% last quarter and has returned 87% year-to-date, despite the rise in interest rates that often has pressured long-duration equities. Causing this re-rating are scientific and technological breakthroughs and proofs-of-concept. According to ARK’s research, the cost of whole human genome sequencing has collapsed from $2.7 billion per genome in 2003 to less than $100; the cost and time to discover and develop new drugs have been shrinking 40-75%; the ability to diagnose disease in early stages is increasing dramatically; and CRISPR gene editing—supercharged by AI—is curing sickle cell disease and beta thalassemia. Now, investors are beginning to price in the potential for pharma and biotech returns on Research and Development (R&D) to recover from the mid-single digit range toward the 30%+ last seen in the nineties.

Performance

The ARK Venture Fund (ARKVX) returned 3.30% during the quarter, outperforming the S&P 500 and MSCI World Index, which rose 2.30% and 1.96%, respectively.

Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal will fluctuate so that an investor’s shares when redeemed may be worth more or less than the original cost. For the Fund’s standardized performance as of the most recent month and quarter-end click here.

The top contributors to performance were Kalshi and Tenstorrent. 

Kalshi completed a new funding round at a higher valuation as it scaled its regulated prediction-market platform and expanded into broader financial market. During the quarter, Kalshi enhanced its professional trading tools and filed to offer perpetual contracts linked to cryptocurrencies, commodities, and major equity benchmarks, positioning the platform to capture more recurring trading activity. Its transition to the public markets broadened investor access and supported a higher valuation. In our view, Kalshi’s Commodity Futures Trading Commission (CFTC)-regulated exchange, expanding brokerage distribution, and deepening liquidity strengthen its potential to become core infrastructure for pricing and trading real-world outcomes. 

Tenstorrent attracted growing investor interest amid demand for alternatives to incumbent AI-compute architectures. The company combines AI accelerators and systems with licensable RISC-V⁵  CPU intellectual property (IP), allowing customers to purchase complete hardware or develop customized chips. The launch of its TT-Ascalon S CPU IP and the deployment of more than 120 Galaxy systems with Japanese AI platform provider ai& demonstrated progress from product development to customer adoption. In our view, Tenstorrent could benefit from demand for more power-efficient, customizable computing platforms, though its ability to scale commercially, mature its software ecosystem, and compete with established providers remains central to execution.

The top detractors from performance were SpaceX and Cellares.

Shares of SpaceX detracted from performance as investors weighed the rising capital requirements of its AI and Starship ambitions against near-term execution risks. Second-quarter revenue and adjusted earning before interest, taxes, depreciation and amortization (EBITDA) exceeded expectations, but Starlink subscriber growth fell slightly short of estimates while AI-related capital expenditures rose sharply. Reports of redesigns to terrestrial data-center infrastructure raised further questions about the cost and pace of compute expansion. Nevertheless, SpaceX advanced Starship flight testing, deployed next-generation Starlink satellites, expanded its defense and enterprise backlog, and continued developing its AI infrastructure and products. In our view, the share-price weakness reflected elevated expectations and execution concerns, while the company’s long-term competitive position across launch, connectivity, and artificial intelligence remained intact.

Cellares faced a significant commercial setback when Bristol Myers Squibb (BMS) terminated its manufacturing partnership with the company. BMS stated that Cellares’ Cell Shuttle system could not meet the requirements for commercial production of Breyanzi—a determination that the company emphasized was specific to Breyanzi—and its established, regulatory approved manufacturing process. The loss of the partnership prompted workforce reductions and increased uncertainty around Cellares’ commercialization outlook. Cellares disputed BMS’s characterization of its technology, citing successful manufacturing of clinical doses that were administered to patients and that met release specifications. In our view, Cellares’ Cell Shuttle and Cell Q platforms could materially reduce labor needs, facility requirements, manufacturing complexity, and batch costs. Realizing that potential will depend on demonstrating reliable performance, securing regulatory validation, and successfully executing at commercial scale.

Active Management

During the quarter, the ARK Venture Fund’s assets under management (AUM) increased from $1.30 billion to $1.35 billion, thanks to market appreciation and $9 million net inflows. The quarter demonstrated the benefits of the Fund's crossover strategy, as Freenome and Securitize transitioned to the public markets through special purpose acquisition company (SPAC)⁶ mergers while we continued to invest in the next generation of private innovators. The expiration of trading restrictions on a portion of the Fund’s SpaceX holdings further demonstrated this flexibility. We were not required to sell as restrictions expired, allowing us to take profits patiently and selectively and use the proceeds to fund new positions while maintaining a high allocation to private companies.

New Positions

We initiated new positions in the private companies The Boring Company, Cosm, K2 Space, Precision Neuroscience, and Wayve. We also invested in a defense company that remains in stealth and look forward to sharing more details soon.

• The Boring Company is an infrastructure and tunnel construction company founded by Elon Musk in 2016 with the goal of solving urban congestion through fast, low-cost underground transit. The company designs and builds its own electric tunnel boring machines, the Prufrock series, which is engineered to bore faster and at a fraction of the cost of conventional tunneling by using continuous boring, heavy automation, and smaller-diameter tunnels sized for vehicles rather than trains. We believe the company’s standardized, vertically integrated approach could materially reduce tunneling costs and construction times, making underground transportation economically viable in more markets.
• Cosm is an immersive entertainment company that builds and operates large format LED dome venues where guests watch live sports, experiential cinema, and arts in what it calls "shared reality." Its domes recreate the feeling of being at a live event, and the company runs its own venues in markets like Los Angeles, Dallas, and Atlanta, with plans to expand to more locations in the US. We believe Cosm combines proprietary technology, compelling content, and a premium social experience to create a scalable entertainment category that brings the atmosphere of live events to a broader audience.
• K2 Space is a vertically integrated satellite manufacturer building high-power, high-mass spacecraft for commercial and national security missions. The company’s core platform is designed to support large payloads, operate across multiple orbits, and deliver materially more power than traditional small satellites, enabling use cases like Medium Earth Orbit (MEO) communications, missile warning and tracking, space-based interceptors, and future orbital compute infrastructure. We believe falling launch costs will make larger, more powerful satellites increasingly economical. K2’s vertically integrated platform could position the company to serve growing demand across communications, national security, and orbital computing.
• Precision Neuroscience is pioneering a brain implant, known as a brain-computer interface (BCI), to restore communication and independence for people with neurological conditions. The company’s cutting-edge technology is designed to empower people with paralysis to control digital devices—such as computers and smartphones—with their thoughts alone, opening new possibilities for daily life. We believe brain-computer interfaces could transform care for people with neurological conditions and create new ways to interact with technology. Precision’s minimally invasive approach could help broaden adoption by balancing high-resolution neural recording with patient safety.
• Wayve Technologies Ltd. is a London-based autonomous driving company, founded in 2017 by University of Cambridge researchers, developing a hardware-agnostic, mapless "AI Driver" using end-to-end deep learning. The company plans to license its software to automakers and fleet operators across L1 through L4 autonomy levels.  We believe Wayve’s adaptable AI Driver and software licensing model could enable autonomy across multiple automakers, vehicle platforms, and geographies, supporting broad adoption without the capital requirements of manufacturing vehicles or operating fleets.

Increased Positions

We also added to existing positions in Ayar Labs, Boom, Crusoe, Freenome, Epic Games, Iambic, Lila Sciences, Lucra, Recursion, and Shield AI.

The third quarter highlighted the benefits of the Fund’s crossover approach. As Freenome and Securitize went public through SPAC mergers, both positions transitioned from the Fund’s private allocation into its public allocation, reducing the Fund’s private exposure while allowing us to maintain ownership. Although our shares remain subject to post-listing lock-up restrictions, we expect greater flexibility to manage those positions actively once applicable lock-up and resale restrictions expire, based on our long-term return expectations and relative opportunities across the portfolio. We believe this approach differentiates the ARK Venture Fund from traditional venture capital funds by allowing us to remain invested throughout a company’s lifecycle while managing toward our targeted allocation of approximately 80% private and 20% public investments.

Source: ARK Investment Management LLC 2026, based on data as of September 30, 2026. The data presented is for informational purposes only. Total assets under management (AUM) and allocation breakdown are subject to change. Historical increases in AUM are not a guarantee of future increases as AUM may decrease during down markets and/or as the result of redemptions.

As shown in the chart above, the fund's private exposure dipped as of June 30, 2026, following SpaceX’s initial public offering (IPO). During the third quarter, we quickly deployed capital into opportunities in our private deal pipeline, opportunistically using unlocked shares of SpaceX as a source of liquidity.

Public Market Listings

During the quarter, two ARK Venture Fund holdings, Freenome and Securitize, completed their transitions to the public markets through SPAC mergers. In our view, both listings marked important milestones for companies addressing large, long-term opportunities in early cancer detection and financial infrastructure. The Fund’s crossover structure allows us to maintain ownership as these businesses move from private development into their next phase as public companies.

Freenome completed its merger with Perceptive Capital Solutions Corp., raising approximately $310 million in gross proceeds to support its blood-based cancer screening portfolio, AI-enabled multiomics platform, and commercial infrastructure. We believe Freenome’s approach, which combines multiple biological signals with machine learning, could expand access to early cancer detection and improve screening participation. The additional capital supports the development of tests across multiple cancer types and the infrastructure needed to reach more patients.

Securitize completed its merger with Cantor Equity Partners II, marking an important milestone in its development as a provider of infrastructure for tokenized securities. The company enables financial institutions to issue, manage, and trade assets on blockchain networks through regulated infrastructure and partnerships with leading asset managers. We believe tokenization could improve the efficiency and accessibility of capital markets, and Securitize’s regulatory capabilities and institutional relationships position it to benefit as adoption expands. Its transition to the public markets supports continued investment in its platform and broader international expansion.

Liquidity Management

The Fund offers quarterly liquidity at the end of each calendar quarter. Prior to each redemption deadline, the Fund (1) proactively accumulates up to ~5% cash to meet anticipated liquidity needs, (2) reserves capital for near-term private investments, and (3) allocates the remainder to public equities. This approach seeks to minimize taxable transactions and avoid forced selling of public positions.

Source: ARK Investment Management LLC. As of September 30, 2026. The data presented is for informational purposes only.

As of September 30, 2026, redemption requests totaled ~$55 million, or 4.1% of the Fund, which were fully covered by cash accumulated prior to quarter end. 

Source: ARK Investment Management LLC. As of September 30, 2026. Past grants of liquidity is not a guarantee of future liquidity. The data presented is for informational purposes only.We believe the third quarter highlighted the continued importance of public-market exposure for innovative companies.

Outlook

The transitions of Freenome and Securitize to the public markets through SPAC mergers illustrate how companies can secure additional capital and broaden investor exposure through different listing pathways. While these transactions do not signal a broad reopening of the traditional IPO market, we believe companies with differentiated technologies, commercial traction, and clear paths to long-term value creation remain well positioned to pursue public listings. For many private innovation companies, public-market exposure can support the next phase of development and commercialization.

Across artificial intelligence, advanced energy, robotics, aerospace, and next-generation infrastructure, innovation continues to accelerate. We believe the opportunity extends from companies developing AI applications to the compute, connectivity, and energy infrastructure needed to support their adoption. Advances in healthcare and financial technology also create opportunities for businesses addressing unmet needs and modernizing established systems. Together, these trends could expand the universe of venture-backed companies capable of transitioning successfully to the public markets.

As a crossover investor, ARK Venture seeks to participate throughout a company’s lifecycle, from private funding rounds through the public markets. We view public listings, whether through traditional IPOs or SPAC mergers, as important milestones that can provide exposure to capital, greater transparency, and eventual liquidity. Our structure allows us to maintain exposure to companies we believe can compound value over the long term, while providing flexibility to manage positions as trading restrictions expire and relative opportunities evolve across the portfolio. This long-term perspective also informs how we assess innovation’s potential amid broader economic uncertainty.

According to our research, the US is heading "back to the future": today's “wall of worry”—inflation, interest rates, deficits, tariffs, wars, and technology dislocations—seems much like that in the eighties and nineties. Indeed, fears that AI is a bubble echo investor sentiment during the PC and smartphone revolutions. Despite volatility, those worries gave way to the most durable equity bull market since the Roaring Twenties, as technology adoption translated into real productivity and earnings gains. 

The convergence among AI, robotics, energy storage, public blockchains, and multiomics technologies could lift real Gross Domestic Product (GDP) growth well beyond the 2–3% range in place since the Industrial Revolution, potentially creating productivity gains in the 5–6% range while inflation falls to between -2% and +2%. Short rates could rise with nominal growth while the yield curve inverts without a recession, as it did during the Industrial Revolution. In our view, this setup could create a new golden age for equities and an innovation super cycle favoring companies and stocks on the right side of change.

Important Information

Investors should carefully consider the ARK Venture Fund's investment objectives and risks, as well as charges and expenses, before investing. This and other information are contained in the ARK Venture Fund’s prospectus, which may be obtained by visiting www.ark-funds.com.

The ARK VENTURE FUND is a continuously-offered, non-diversified, registered closed-end fund with limited liquidity. An investment in the Fund’s Shares is not suitable for investors that require liquidity, other than liquidity provided through the Fund’s repurchase policy.

All statements made regarding investment opportunities are strictly beliefs and points of view held by ARK and investors should determine for themselves whether a particular investment or service is suitable for their investment needs. Certain statements contained in this document may be statements of future expectations and other forward-looking statements that are based on ARK’s current views and assumptions, and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The matters discussed in this document may also involve risks and uncertainties described from time to time in ARK’s filings with the U.S. Securities and Exchange Commission. ARK assumes no obligation to update any forward-looking information contained in this document.

ARK assumes no obligation to update any forward-looking information contained in this document.

You should not expect to be able to sell your Shares other than through the Fund’s repurchase policy, regardless of how the Fund performs. The Fund’s Shares will not be listed on any securities exchange, and the Fund does not expect a secondary market in the Shares to develop. Shares may be transferred or sold only in accordance with the Fund’s prospectus. Although the Fund will offer to repurchase Shares on a quarterly basis, Shares are not redeemable and there is no guarantee that shareholders will be able to sell all of their tendered Shares during a quarterly repurchase offer. An investment in the Fund’s Shares is not suitable for investors that require liquidity, other than liquidity provided through the Fund’s repurchase policy.

There is no assurance that the Fund will meet its investment objective. The value of your investment in the Fund, as well as the amount of return you receive on your investment in the Fund, may fluctuate significantly. You may lose part or all of your investment in the Fund or your investment may not perform as well as other similar investments. Therefore, you should carefully consider the following risks before investing in the Fund.

Principal Risks of the Fund Include:

Private Company Risk. The Fund invests in private, early-stage companies that may be considered highly speculative. As a result, investment in shares of the Fund involves substantial risks including risks associated with uncertainty regarding the valuations of private company investments, high rate of failure among the early-stage companies, and restricted liquidity in securities of such companies. Communications Sector Risk. The Fund will be more affected by the performance of the communications sector than a fund with less exposure to such sector. Cyber Security Risk. As the use of Internet technology has become more prevalent in the course of business, funds have become more susceptible to potential operational risks through breaches in cyber security. Disruptive Innovation Risk. Companies that the Adviser believes are capitalizing on disruptive innovation and developing technologies to displace older technologies or create new markets may not in fact do so. Financial Technology Risk. Companies that are developing financial technologies that seek to disrupt or displace established financial institutions generally face competition from much larger and more established firms. Next Generation Internet Companies Risk. The risks described below apply, in particular, to the Fund’s investment in Next Generation Internet Companies. 

Foreign Securities Risk. The Fund’s investments in foreign securities can be riskier than U.S. securities investments. Investments in the securities of foreign issuers (including investments in ADRs and GDRs) are subject to the risks associated with investing in those foreign markets, such as heightened risks of inflation or nationalization. The prices of foreign securities and the prices of U.S. securities have, at times, moved in opposite directions. In addition, securities of foreign issuers may lose value due to political, economic and geographic events affecting a foreign issuer or market. During periods of social, political or economic instability in a country or region, the value of a foreign security traded on U.S. exchanges could be affected by, among other things, increasing price volatility, illiquidity, or the closure of the primary market on which the security (or the security underlying the ADR or GDR) is traded. You may lose money due to political, economic and geographic events affecting a foreign issuer or market. The Fund normally will not hedge any foreign currency exposure. Future Expected Genomic Business Risk. The Adviser may invest some of the Fund’s assets in Genomics Revolution Companies that do not currently derive a substantial portion of their current revenues from genomic-focused businesses and there is no assurance that any company will do so in the future, which may adversely affect the ability of the Fund to achieve its investment objective. Emerging Market Securities Risk. Investment in securities of emerging market issuers may present risks that are greater than or different from those associated with securities of developed market issuers due to less developed and liquid markets and such factors as increased economic, political, regulatory, or other uncertainties. 

Cryptocurrency Risk. Cryptocurrencies (also referred to as “virtual currencies” and “digital currencies”) are digital assets designed to act as a medium of exchange. Cryptocurrency is an emerging asset class. There are thousands of cryptocurrencies, the most well-known of which is bitcoin. The Fund may have exposure to cryptocurrencies, such as bitcoin indirectly through an investment in the Bitcoin Investment Trust (“GBTC”), a privately offered, open-end investment vehicle that invests in bitcoin. Health Care Sector Risk. The health care sector may be affected by government regulations and government health care programs, restrictions on government reimbursement for medical expenses, increases or decreases in the cost of medical products and services and product liability claims, among other factors. Leverage Risk. The use of leverage can create risks. Leverage can increase market exposure, increase volatility in the Fund, magnify investment risks, and cause losses to be realized more quickly. Non-Diversification Risk. The Fund is classified as a “non-diversified” investment company under the 1940 Act. Therefore, the Fund may invest a relatively higher percentage of its assets in a relatively smaller number of issuers or may invest a larger proportion of its assets in a single issuer. As a result, the gains and losses on a single investment may have a greater impact on the Fund’s NAV and may make the Fund more volatile than more diversified funds. 

To view the top 10 holdings in the ARK Venture Fund, click here. To view the most up-to-date portfolio, click here.

Diversification neither assures a profit nor guarantees against loss in a declining market.

The Nasdaq 100 Index comprises the 100 largest nonfinancial companies trading on the Nasdaq exchange, excluding the financial sector.

The S&P 500 Index is a stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States.

The MSCI World Index represents large and mid-cap equity performance across 23 developed markets countries.

The Russell 2000 Index is a stock market index tracking the stock performance of 2,000 companies listed on stock exchanges in the United States that are considered to have small market capitalizations. 

PCE, or Personal Consumption Expenditures, Inflation is a measure of the average change in prices paid for domestic goods and services by U.S. consumers, tracked monthly by the Bureau of Economic Analysis.

Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period.

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ARK Investment Management LLC (“ARK Invest”) is the investment adviser to the ARK Venture Fund.