[lucasjake]

I think ultimately what might happen here is that the government will regulate VC to make it difficult or illegal for fundraising rounds to be used primarily to pay off earlier investors. Saying it out loud like that made me realize how close to a ponzi scheme such a thing could easily become.

[ebaysucks]

So it's OK if you raise money in an IPO from a lot of small investors, but it becomes illegal if you raise money from a few experienced investors?