[grellas]

Sorry for not putting it more clearly. When I said that liquidation preferences do not drive up valuations, I meant (in the spirit of the article) that this is not an explanation for why valuations today are extraordinarily high for this number of companies as compared to prior eras when they also had liquidation preferences.

Of course, as your comment correctly points out, a liquidation preference has value, even immense value for its downside protection. And this value is reflected in the valuation. It just isn't the reason for a huge upward spike above the historical norm.

Hope this clarification helps.

[freshhawk]

I don't see where the article stated that this is the explanation for current valuations. Just that it "very likely pushes valuations even higher", which is an understatement if anything.

[pbreit]

I don't think the impact is as great as many think. Unicorns and other companies headed in that direction almost never liquidate so the preference rarely comes into play meaning the valuations are more real than many think.