It's due to adverse selection. They are able to raise at higher valuations BECAUSE there is more interest. And I do think that people can smell hits early, so

It's due to adverse selection. They are able to raise at higher valuations BECAUSE there is more interest. And I do think that people can smell hits early, so there is more interest. I learned my lesson: I passed on Dropbox at $20m pre, because I felt I needed to invest at lower valuations to be profitable. I was wrong.