The VC model is more conducive to the Greater fool theory: http://en.wikipedia.org/wiki/Greater_fool_theory http://en.wikipedia.org/wiki/Greater_fool_theory. Wh

The VC model is more conducive to the Greater fool theory: http://en.wikipedia.org/wiki/Greater_fool_theory http://en.wikipedia.org/wiki/Greater_fool_theory. While social psychology and public sentiment certainly plays into the valuation of public companies, being a public company typically restricts valuation to more standardized valuation models and scrutiny; it's much more transparent overall.