Supply and demand Returns from private companies go up -> more VCs enter the market with higher returns increasing competition -> valuations get higher (meanin

Supply and demand Returns from private companies go up -> more VCs enter the market with higher returns increasing competition -> valuations get higher (meaning founders/employees get to keep more stock while investors get less) -> returns deflate and we are back at a balance. There is a reason VCs have been complaining about sky high valuations and it's because most VC's don't even beat the sp 500.