[tesseract]

> Investors make money if they sell their stock (or other instruments) for more than the purchase price. Without and IPO or M&A, how would this happen?

Investors also make money from dividends. They are the traditional way an owner of a privately held company would see a return on their investment. A VC may not want to hold shares in a mature, dividend paying company because they don't fit the VC's investment profile, but an IPO is in theory not the only possible exit. The VC could sell its shares to a non-VC private equity firm, for instance. Or a sufficiently successful company could buy back its stock that is held by the VC. In practice I am not sure how often this happens - it definitely doesn't seem common.