[rhlsthm]

This isn't really true. If you actually wanted to and tried to put in early stage money, you could. Lots of startups raise their first few hundred K from "friends and family" type rounds and are usually readily looking for small investors to write small (25k or even less) checks.

I would bet within a couple degrees of separation within your network you can find someone raising money for a project you're at least somewhat interested in. There are also platforms like AngelList that are making it easier to fund deals with small money.

[mistermann]

It's not true that it's different?

How might an individual know about and do some baseline reasonable due diligence on these opportunities as identically easily as he could with a publicly listed stock?

And why do VC's bother going through all the work, if the outcome is no different than if they'd simply have left things be as they were, with these companies getting funding from the public markets?

[lovich]

How many of those people get pushed out by later VC money because they want to clear up the cap table?