i dont get why the shares in the investment isn't just divvied up to each individual investor, and let them make a choice to sell or not. And if there's transaction costs involved in selling small amounts, it could be aggregated before divving up, and those who wants to sell can collectively sell and save on costs.
Holders can still band together as a single pot, like a fund which can count as only one investor.
This sounds like a loophole, and now that I think if it it probably is - VCs and stuff should not have been allowed to ask for money from pension funds without imposing at least some rules normally applied to public companies.
And now there are startups where you can place bids on private market stock without being a qualified investor or pushing the company into a spot where it has to go public.
