
Why It's Time to Ignore Fidelity's Startup Valuations - prostoalex
http://fortune.com/2016/03/31/its-time-to-ignore-fidelitys-startup-valuations/
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howlingfantods
The thesis is that because Fidelity doesn't have full access to a company's
newest finances, its valuations are largely unreliable and insubstantial.

But I'd rather take the fair value valuation of a passive third party over the
fanciful valuations of a management team incentivized to project sky high
revenues.

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xyzzy4
Valuations are ultimately determined by buyers and sellers. If nobody is
buying or selling stock, then any valuation doesn't hold much weight.

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shalmanese
That's a wonderful standard to aspire to but not always realistic. Say you're
trying to take out a loan with your house as the security. The bank can't
force you to sell your house just to obtain a valuation, they have to estimate
it via indirect means and shit goes really wrong if they get that number
systematically wrong.

Most consumers are only used to dealing with relatively liquid assets (apart
from their house) but businesses deal with illiquid assets as a matter of
course and appropriately valuing them is both routine and hugely important.

