Comment by jcranmer
8 hours ago
Regulations that limit the ability of investors to invest in private companies, although these have been weakened in recent decades, which helps fuel the growth of private credit markets that allow private companies to stay private.
I'd say it's the growth of private markets to allow companies to keep getting funding even at the $100 billion range while staying private that has fueled the trend to stay private rather than SOX and other new regulations for public corporate governance dissuading them from going public.
>Regulations that limit the ability of investors to invest in private companies, although these have been weakened in recent decades, which helps fuel the growth of private credit markets that allow private companies to stay private.
Which regulations are these?
SEC 12(g). The cap was raised by the JOBS act.
It's not that you couldn't stay private before, but there wasn't much benefit because after crossing that cap you had reporting obligations comparable to public companies anyways.
I searched around and your original claim doesn't seem too convincing. Recall the original claim was
>Regulations that limit the ability of investors to invest in private companies ...
The JOBS act raised the cap from 500 investors to 2000, but with VC funds, that's hardly an issue. Does Anthropic (and other unicorns) really need 500+ VC backers? It might change behavior on the margins, but it's hard to imagine that's the cause for the paucity of public listings.
The actual change that made it more tenable to stay private is arguably the carveout for employee stockholders, but summarizing that as "limit the ability of investors to invest in private companies" is a bit misleading.