Everyone's eager to get a slice of these pre-IPO companies, and the marginal utility of having it be more liquid on the public markets probably doesn't outweigh the legal requirements behind going public. It's not like VCs are stuck holding the bag until an IPO these days. I'm not sure why that changed, but it's probably not healthy.
I know plenty of companies that are failing on VC dime, whose investors can't sell their equity. I disagree that everyone wants a slice of these companies. It's not clear to me whether it's a net win for VCs to hold onto illiquid investments for so long (meaning I can see both the upsides and the downsides.)
VCs just want returns on the money, and they don't need to use the stock market for that as much anymore.
So true. I know I'd rather be murdered by an American ASI than a Chinese one.
And also set up moats so for security only they are allowed to push the state of the art forward.
Paraphrasing Bill Hicks.
To me it's pretty clear. The earlier investors take out all the possible upside and then dump it on the retail market. The retail investor will be less and less able to buy stock that will grow 10x and more. It's hard to imagine SpaceX, OpenAI or Anthropic will multiply in value after the IPO. They are priced in a way that they have to execute perfectly for a long time to justify even their current price.
Just another step for the super wealthy to keep profits for themselves instead of letting the broader population to benefit.
The thing is normally it's money that's intended to be burned in the search of a unicorn, cheap money, so there's no real "risk" there.
Also, I think comparing WeWork to AI labs is not valid.
These labs have increasingly become of public interest and are shaping economies around the world, WeWork was just not at that level.
The JOBS Act and proliferation of double-vesting trigger RSUs effectively negated these forcing functions and 'going public' went from a necessary growing pain to a burden and distraction.