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A comment on Why startups aren’t bothering to go public anymore. Parent comment

Re:Why startups aren’t bothering to go public anymore by sbov on Wednesday November 10, 2010 @01:47PM (#1891390)
I'm not well versed in stock/securities laws, but I would imagine it would have to do with this: http://en.wikipedia.org/wiki/Insider_trading

The CEO couldn't possibly take personal calls from every investor after going public. I don't feel particularly bad that someone can't get privileged information from the company that wouldn't be available to other investors. These regulations are for fairness.

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Re:Why startups aren’t bothering to go public anymore by T_S_ on Wednesday November 10, 2010 @02:26PM (#1891500)
You are correct that the CEO cannot favor investors due to SEC regulation and simple fairness. However, the issue raised is that companies use these regs as an excuse to draw the curtains and provide less information on the whole.

This is bad for economic decision making on the whole. For example, it leads to greater volatility and securities prices that don't track value. It also places managers into a kind of priesthood with privileged access to information. Abuses ensue.

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