Ever since Sarbanes-Oxley there's been a continuously declining number of new public companies. The reality is the modern legal and regulatory environment makes being a public company significantly more burdensome than it was in 1995.

There's more than abundant amounts of capital in private equity, so the only real reason to go public is to create liquidity for early founders/investors/employees who want to cash out. Given that, arguably you could say going public, instead of raising private capital, is the smell. Or at least an attempt to top-tick the valuation, e.g. WeWork.

Another way I look at this is that wealth has accumulated so disproportionately at the top that the small number of individuals/firms flush with wealth need to find ways to spend the money. So why not dump hundreds of millions on another company? Since there isn't any actual force coming in to take and redistribute it, might as well spend it.

Both. I personally find the fact that having these later and later rounds of funding considered normal a huge indicator that something is very wrong with the current industry.

It means there's a lot of capital being dumped into trying to find some hidden source of profit and it's getting harder and harder to find it.

It's the capital equivalent of going from finding oil in your back yard to blasting it out of tar sands in the Canadian tundra. Sure the capital/oil keeps flowing, but the inherent unsustainability of the system starts to show its face more clearly.

Normal - just take a look on crunchbase