A decade ago, 88% of a tech company's value was created post-IPO. For recent IPOs, 55% of the market cap creation happened while the company was still private, fundamentally changing where investors capture growth.

Unlike a decade ago, today's most transformative, high-growth companies like OpenAI and Anthropic are choosing to remain private for longer. This trend concentrates the highest potential returns in private markets, making it difficult for public investors to 'own the future' of technology.

The venue for tech value creation has dramatically shifted from public to private markets. For recent IPOs, over half of their market cap was generated while private, a stark reversal from ten years prior when 88% of value was created post-IPO.

Venture-backed private companies represent a massive, $5 trillion market cap, exceeding half the value of the 'Magnificent Seven' public tech stocks. This scale signifies that private markets are now a mature, institutional asset class, not a small corner of finance.

David Craver asserts that being an active private market investor is an "imperative" for success in public markets. The research and insights gained from late-stage, pre-IPO companies provide crucial information that directly informs and strengthens a firm's public equity investment strategy in an interconnected landscape.

Companies like Databricks and Stripe represent a new asset class: "Post-IPO Scale, Still Private." They have surpassed the revenue and scale typically required for an IPO but choose to remain private. This creates a distinct investment category separate from traditional late-stage venture, driven by the perceived disadvantages of public markets.

Gurley argues that the rise of mega VC funds has fundamentally changed capital markets. These funds convince successful companies like Stripe to stay private longer, effectively 'hijacking' their hyper-growth years from the public markets. This prevents public investors from participating in wealth creation as they did with companies like Amazon.

The trend of companies staying private longer and raising huge late-stage rounds isn't just about VC exuberance. It's a direct consequence of a series of regulations (like Sarbanes-Oxley) that made going public extremely costly and onerous. As a result, the private capital markets evolved to fill the gap, fundamentally changing venture capital.

The market for hyper-growth tech companies now exists almost exclusively in private markets, with only 5% of public software firms growing over 25%. With companies staying private for 14+ years, public markets are now for mature, slower-growing businesses.