[dsacco]

> If there are a dozen investors willing to buy stock at $x it’s worth $x.

This is not a correct representation of liquidity, and thinking about it under this definition can be very dangerous. You need to consider:

1. How many shares are there outstanding?

2. What is the ask price of those shares on paper?

3. What is the bid price of those shares by investors willing to purchase them on the private market?

4. How many owners are allowed to sell their shares at the same time?

5. How many owners could realistically find a buyer at the paper ask price of the shares?

6. How many owners could sell their shares before the existing deviation (spread) between the paper ask price and available bid prices changed?

This is not to say your overall point is wrong, it's to say that it can't be defended this way; more importantly, we really shouldn't be simplifying our discussion and its definition of liquidity to the one you've presented here, which is too simplistic. There is a lot of nuance about price discovery between public and private valuation that's missing here. For (one) example, you can maintain an artificially inflated valuation of a private company if there are fewer owners willing/able to sell than there are buyers, despite a relatively larger set of potential owners either not allowed to, or not conveniently capable of, selling their shares. This scenario makes presents an asymmetry between the weighting and availability of positive vs negative price sentiment that is much more easily resolved in the public market.

[austenallred]

Of course there’s a lot of nuance there. But certainly we can all agree on two things:

1. YC has not had good returns because it has only had one IPO (apparently selling Twitch and Cruise for $1B each don’t count as a win?)

2. While it’s difficult to know what the true value of YC companies is, the fact that there are nearly 100 companies valued at $100m+ is not just a “vanity metric.” Especially st the later stages of more mature companies there are real dollars trading hands and there’s more liquidity available on secondary markets.

[dsacco]

Sure, I agree with those two points.