The standard operating practice for Silicon Valley startups now is to put of IPOing as long as possible. Facebook actually got several exceptions from the SEC so that they didn't have to go public. Going public entails a ton of hassle, for example if Airbnb went public and had one of their programmers accidentally introduced a bug that misreported the number of users they had they could be liable for fraud. There's very little benefit to going public except that it creates a market for the stock which gives employees liquidity. However public markets are actually pretty crappy for that too because in order to avoid insider trading employees are often confined to a narrow window of time when they can sell their stock. Because they are lots of employees who want to convert their stock into money to but things this window gets flooded with sellers and employees wind up getting 80 cents on the dollar compared to other stock holders.
So yeah, you are missing something. Public markets are basically strictly worse than private investors. Also it's not like there are a bunch of private investors waiting to write $555M checks to company's whose financials suck... how could that make any sense?
> Because they are lots of employees who want to convert their stock into money to but things this window gets flooded with sellers and employees wind up getting 80 cents on the dollar compared to other stock holders.
I receive stock in compensation. I have elected to auto-sell it - this works even during trade window freezes.
Alternatively, they may end up getting 120 cents on the dollar, compared to other stock holders, if the stock rose in price between the time that other insiders could sell, and the time that employees could sell. If the company's on an upwards trajectory, this is quite likely.
> Also it's not like there are a bunch of private investors waiting to write $555M checks to company's whose financials suck... how could that make any sense?
"Our financial don't suck, it's just that going public is really really hard and we don't want to comply with the law that's going to show that our financials suck. Wait... scratch that last line."
So yeah, you are missing something. Public markets are basically strictly worse than private investors. Also it's not like there are a bunch of private investors waiting to write $555M checks to company's whose financials suck... how could that make any sense?