[j_baker]

Because there's no one they can sell their shares to. With a public company, you can sell your shares on the stock market.

[zkhalique]

Perhaps they should be able to sell their shares back to the company? The company would be responsible for raising more money and have some allocation for share buyback.

[scurvy]

Some well-run startups make arrangements for this when raising a round. The VC will agree to buy into the round at X dollars per share. They'll also agree to buy up to Y dollars worth of stock from employees who want to sell. VC gets more ownership of the company, and the company doesn't have to give up more ownership. It's overall a good situation. I know that Cloudflare and a few other companies offer this.

[tptacek]

A few very good companies do make this possible, but it takes effort to set up and is not the default.

[exelius]

Who would determine the price of common shares without a liquid market?