Companies like Stripe are avoiding IPOs because the private markets now solve the two main historical drivers: access to capital and employee liquidity. With annual secondary tenders and vast private funding available, the traditional benefits of going public are no longer compelling for many late-stage startups.

The secondary market is no longer just for LPs seeking early liquidity. With trillions in unrealized private assets, it's becoming a primary way for investors to gain exposure, akin to buying a public stock. One can now buy into established private companies directly, not just new funds.

The traditional IPO exit is being replaced by a perpetual secondary market for elite private companies. This new paradigm provides liquidity for investors and employees without the high costs and regulatory burdens of going public. This shift fundamentally alters the venture capital lifecycle, enabling longer private holding periods.

In an era where companies stay private longer, the promise of a distant IPO is not enough. Talented employees now expect and demand opportunities for secondary sales through tender offers. Startups that cannot provide a credible, near-term path to liquidity will lose the recruiting war for top talent.

Retail investors should view hyped IPOs not as a starting line, but as the finish line for early venture capitalists and insiders. These sophisticated players use the public market's excitement to cash out, leaving retail investors to bear the risk of post-IPO volatility and potential downturns.

Success in late-stage venture resembles trading more than traditional investing—it's about buying and selling on momentum. However, this "new public market" has a critical flaw: while liquidity exists on the way up, it vanishes on the downside, making it impossible to execute a true trading strategy when a correction occurs.

Individual investors buying shares in private AI companies through brokerage platforms are at a significant disadvantage. They are typically last in line behind institutional investors, resulting in higher entry prices and fees, making it a poor strategy for accessing the AI boom.

Due to the abundance of private capital, companies now go public much later in their lifecycle. The IPO has consequently become the final exit for insiders to cash out, leaving little upside for retail investors who are effectively buying at the peak.

The traditional VC model of waiting for an IPO or acquisition is obsolete. With companies staying private for 20+ years, firms must develop the skill of actively selling positions in secondary transactions to provide necessary liquidity for their LPs.