That reminds me of the basic investing advice by a friend of mine who is a $100M fund manager. He says there are three factors to any investment - risk, returns

That reminds me of the basic investing advice by a friend of mine who is a $100M fund manager. He says there are three factors to any investment - risk, returns, and liquidity. Fix one of these three. If you want low risk, you must sacrifice either high returns, or high liquidity. So most good investments (relatively low risk and high returns) have poor liquidity - it can be slow and difficult to convert the invested capital back into cash. Buying fast food franchises is a good example. They're reliable cash cows, but hard to sell. The ultimate returns come from low liquidity and high risk. That's the world of venture capital. Without the possibility of 100x returns, it's absolutely stupid to invest in new businesses with little likelihood of survival. Money tied up in preferred stock is effectively illiquid and can be completely lost (hence the term "liquidity event"). And that can and should take years.