By defending the pro rata rights of early backers against new, powerful investors, founders play an "infinite game." This builds a reputation for fairness that compounds over time, attracting higher-quality partners and investors in future rounds.

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.

The trend of allowing employees to sell shares in secondary transactions before investors get liquidity is a problem. Lior Susan argues this creates a fundamental misalignment, as historically, employees and investors realized returns at the same time. The system needs rethinking for long-duration private companies.

Taking a small amount of money off the table via a secondary sale de-risks a founder's personal finances. This financial security empowers them to reject large acquisition offers and pursue a long-term, independent vision without the pressure of life-changing personal wealth decisions.

Vested works directly with employees because startups find small, one-off secondary transactions burdensome due to legal fees and cap table complexity. However, this dynamic inverts at scale. Once Vested facilitates millions in transactions for a single company's stock, the startup has a strong incentive to partner on a formal liquidity program.

The firm’s core belief is being a fund *for* founders, trusting them to run their companies without heavy operational input. This hands-off approach gives partners the bandwidth and "permission" to go deep on their own projects, leading to spinouts like Anduril and Varda.

An expert reveals two shocking statistics: 80% of new founders fail their first diligence attempt, and 85% of early-stage investors don't perform confirmatory diligence. This highlights a massive, systemic weakness and inefficiency in the startup ecosystem, creating significant risk on both sides of the table.

Vested neutralizes non-delivery risk, a major concern in private markets. By funding exercises, they ensure the employee retains a majority of their stock, aligning incentives. Small deal sizes ($50k-$100k) make it economically irrational for an employee to default and ruin their reputation, leading to a 100% delivery rate.

The number of founders taking secondary liquidity after their seed round is twice as high as the 2021 peak. While this de-risks the journey for founders, there is almost no parallel liquidity offered to early employees, creating a growing divide in early-stage risk and reward.