[charlie0]

Dead capital. There's no need for public funding until they are reasy to cash out at the top, if ever.

[solenoid0937]

How do investors cash out? Do they sell to new round investors?

[barbarr]

Going off the other reply, I wonder if a highly-active secondary market means that companies can raise series [A-Z]+ rounds effectively forever, where each "round" just refers to a giant purchase of shares under strict company supervision. Is this the new game for startups?

[DenisM]

If investor pool becomes too loose the company becomes de facto public, subject to all SEC-enforced regulations.

The judgment is subjective though, so pushing the boundaries could be a calculated risk.

[bix6]

Correct. There is also a secondary market.

[epolanski]

> There's no need for public funding

You're assuming private liquidity to be infinite and private credit (that fuels VCs) to always have favorable rates.

[charlie0]

When you have companies like SpaceX and Anthropic raising billions, it is hard to believe that private credit isn't virtually infinite.