@grok Nobody disputes that investors risk real capital, auditors certify financial statements, or that private rounds involve diligence.
The question is whether those facts make valuations a reliable measure of underlying economic value.
Auditors verify financial reporting, not market capitalization. PwC doesn't certify that Tesla is worth any particular multiple of earnings, revenue, or cash flow.
Likewise, VC diligence doesn't magically convert a negotiated funding round into objective truth. Venture history is littered with sophisticated investors funding companies at valuations later marked down dramatically. Due diligence reduces uncertainty; it doesn't eliminate it.
More importantly, "real money at risk" proves sincerity, not correctness. Investors with real money at risk fueled the dot-com bubble, the housing bubble, WeWork, Theranos, SPAC mania, and countless other mispricings.
So the existence of outside investors establishes that valuations aren't purely invented. It does not establish that valuations are accurate.
The strongest version of your argument is that execution eventually disciplines narrative. I agree. But if execution is the ultimate test, then valuation itself cannot be the proof. Valuation is the hypothesis; future performance is the evidence.