Public Offerings ≠ Offerings For Your Public

They’re using the word “community” way too liberally when it’s only about the money.

^{Rob Petrozzo, for Rally}

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This week’s newsletter is a short one - some running thoughts that I’ve been having personally but, more so, what we think about at Rally every time we acquire a new asset, launch a new IPO, or send any of our individual platform members updates and opportunities… 

A year ago, the IPO window on Wall Street was open, and we saw massive amounts of fanfare for some big private names the likes of Figma, Chime and a host of other well known (but previously private) tech companies. The 2025 window marked the strongest stretch of IPO activity since 2021, following a long period of hesitation around going public. During that IPO drought, a lot of those companies continued raising money privately, boosting their value to the 10s of billions on paper - so when it was time to move, A LOT of them were looking to go public at the same time. What came after many of those offerings was a voice from retail that they were getting left behind on the real money making opportunity of IPOs. The big banks and their best private clients were getting the artificially suppressed price before the public was able to enter (which usually happens after a giant pop as soon as the stock opens).

That brings me to the point of all this: there’s a difference between something being offered to the public and something being built with the public.

Most people assume they’re the same thing. I can tell you nearly a decade in to a very long road of IPO’ing “things,” they’re not. A traditional IPO is, at its core, a distribution event. Investment banks spend months (sometimes years) marketing the story of a company to the public while quietly allocating the most attractive pricing to the institutions and clients already inside the special ultra-exclusive money club. By the time retail investors see the ticker symbol appear on Robinhood or Schwab, the most important decisions (pricing, allocation, positioning, and cash deployment) have already been made. The public gets the offering, but the insiders are typically the ones that get the BIG opportunity (and the big payday). 

It’s not necessarily malicious. It’s just how the system has worked for a hundred years. Banks have most-important relationships to maintain along with tons of important funds to reward for past deals, and the biggest wealth management clients always expect access to the best pricing. The IPO roadshow isn’t really about discovery at all regardless of how they position it to be - it’s about best-distribution.

The Figma IPO got talked about a lot, but it’s the perfect example. Months of positioning and institutional allocations negotiated behind closed doors for a company that 99% of those investors never used (and maybe never even heard of before they were presented with the IPO investment opportunity). The price the public ultimately pays once trading begins wasn’t really a reflection of value - it’s was a reflection of the system that brought it there. On the day it went public, Figma opened at $83 per share, shot to $115, and the lucky ones that got allocated their shares at the pre-launch $33 IPO price got a really nice gift of a 240% gain. Retail investors stepped in after the deal structure, incentives, and early paper-profits had basically all been sorted out already. The designers and devs who actually used (and loved) the product that Figma created and wanted to own equity were entirely outnumbered by speculators who had zero connection to the underlying asset.

Contrast that with something like our T206 Honus Wagner. There was no roadshow or allocation behind closed doors for the $520K IPO. Today, at a $2m+ valuation, 78% of investors who own the asset were there since day one. The institutional desk didn’t decide who had access, and a lot of incredibly knowledgeable collectors and enthusiasts are now a group of people who care deeply about an object and decide collectively whether it deserves a place in the portfolio. The knowledge itself becomes part of the investment, and unlike most IPOs you can actually act on it.

In collectibles, the asymmetry isn’t hidden information about the company’s quarterly forecasts or private conversations between bankers and hedge funds. The asymmetry simply comes down to who understands the object better, or in this case, “cares” more if we’re being entirely honest. That’s a very different game than pure finance. You can read about the history of the Wagner going back over 100 years. You can study its transaction record. You can follow the cultural relevance of baseball, scarcity in pre-war cards, and the way the market has behaved around this card for literally a century. By design, none of that information lives behind a wall at a bank (the ole “never invest with emotion” adage comes into play here, which I vehemently disagree with).

It all lives in the open.

That’s what makes this category interesting right now. Not just the assets themselves, but the structure forming around them. Communities of investors who are learning, collecting, and investing at the same time, and aligning incentives rather than distributing risk. Rally was definitely early to that idea, but we aren’t the only ones who saw it then and continue to see it happening. At times early on, it looked strange - fractional ownership of a dinosaur skeleton or a Wagner card wasn’t exactly how traditional finance imagined markets evolving. But markets evolve where participation increases, and then the participation increases when people feel like they’re part of the opportunity, not just the exit liquidity. My bet is that the inverse will be true in the traditional IPO market with less need to go the standard IPO route, as more companies take that process into their own hands, and as the next generation takes control of the bank accounts during the Great Wealth Transfer.

The next chapter for the highest end of the collectibles category will look more liquid, and much more structured, as a LOT has changed since that 2019 Honus Wagner card IPO. It will look closer to the systems that already exist in true public markets that so many of our Rally users have gotten comfortable with as finance has become democratized across so many markets and platforms since we first started. 

And with each new milestone, one thing will become clearer: the difference between selling something to the public and building something with them will make or break a product - whether now or in the very near future.

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Until Next Week…