Who determines them when you raise money from investors?
That's the market that should determine the value of the shares obviously. The last price fetched on that market. Whether its liquidity is high or low, it's still a viable market, even if it's not the public stock market.
Yep, all of those people stand to gain from setting as low a price as possible given that a liquidity event will reset the share price anyway. Not to mention that any buybacks would hit your run rate, because run rates are about operating cash flows and not valuation numbers (and buybacks are just a way to convert operating cash into equity).
That's the market that should determine the value of the shares obviously. The last price fetched on that market. Whether its liquidity is high or low, it's still a viable market, even if it's not the public stock market.