I have had the chance to take a look at J.P. Morgan's recent Eye On The Market (EOTM) report on released on February 17th, 2016. There are some very interesting comments that should give some nervous venture market observers some consolation, whereas practitioners like us more or less have the maths worked out all the time.
Basically what it meant is that despite all the crying-out-louds among market watchers – notably innocent journalists – about how start public internet companies have fallen below their IPO price (more correctly, closing prices on IPO days), late-stage investors still mostly make money even if they haven't sold the shares already. This is before one even factors in all the provisions they enjoy, provided that these provisions don't block IPOs or M&A exits in a bad way:
For us as early-stage investors, these observations have long-term implication. On the other hand, as long as our entrepreneurs focus on building great products, great teams, great companies, great rapport with their consumers and manage the cash burns properly, I am pretty sure many of them will see successful exits in one way or another regardless of the market conditions.
Just some quick thoughts.