Goldman Sachs CEO: Private equity financing is so easy that American startups do not need to go public

Goldman Sachs CEO says there is enough money in the private market, and startups should be cautious about going public!

Recently, Goldman Sachs CEO David Solomon stated at the Cisco AI Summit that private companies should adopt a "highly cautious" attitude before deciding to go public, as the abundance of capital in the private market has eliminated the necessity for many companies to list. Solomon emphasized:

"Today, you can obtain large-scale funding in the private market and also gain liquidity in the private market, so a company only needs to consider going public when it reaches an incredible scale, and that timing is being pushed back."

In recent years, this trend has become increasingly popular, with large startups such as Stripe, OpenAI, and SpaceX choosing to delay their IPOs despite valuations reaching billions or even hundreds of billions of dollars. Goldman Sachs is also increasingly providing related services; for example, in 2023, Goldman Sachs assisted Stripe in raising $6.5 billion, allowing it to extend its private status.

Analysts point out that these companies have received substantial funding support from venture capital giants like Thrive Capital and sovereign wealth funds from the Middle East, and they also provide employees with a way to cash out shares in the secondary market.

The benefit is that this new type of private "startup" has the scale and complexity of a public company but does not have to bear the scrutiny and reporting obligations required by the public market. Solomon candidly stated:

"Being a public company is not fun. Who would want to be a public company?"