The Illiquidity Discount in VC Investments

In an environment where people are fearful, the institutional players have to go for liquidity because they don't know what their underlying assets might sell out. That creates these real mispricings because of a momentary emotion in a cycle that may not last as long as people think. There's companies we're finding right now that are trading at four or five times earnings. They're growing revenues anywhere sort of from 30 to 70 percent. But if you look at that, and yes, the markets themselves might go down, but when you're comparing them to their bigger sort of cousins, you're wondering why the exact same metrics aren't being applied. If something's cheap, it doesn't say

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