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A tech conference. Photo: Pedro Fiúza/NurPhoto via Getty Images

LISBON — The public stock market is doing pretty well, on the face of things. The S&P 500 is at record highs, European stocks are surging, and a slew of multibillion-dollar companies have IPO'ed this year, raising billions of dollars in fresh capital. But private markets still seem to be much more alluring.

What we’re seeing: I'm in Lisbon this week, attending the Web Summit for the first time. The clear message being sent: Private markets are more attractive than ever.

  • In some ways, Web Summit is much like any other geeky finance conference: Yesterday I interviewed a panel of VCs on the subject of "Where I am putting my money this year," while this morning I moderated a panel on "fintech disruption."
  • The big difference: These discussions take place on the stage of the 20,000-capacity Altice Arena, the largest indoor stadium in Portugal. The conference has welcomed 70,469 attendees in total, nearly all of whom are either actively investing in private companies, or hoping to raise money from people who do.
  • The Web Summit crowd is just a tiny subset of overall private investing, which can include everything from infrastructure to buyouts to timberland.

By the numbers: Venture capitalists have a record $118 billion of cash on hand, ready to invest in private companies, per PitchBook. That's up 20% from 2018. (Still, to put that number in perspective, it's roughly the amount of cash that's just sitting on Apple's balance sheet alone.)

  • As the amount invested grows, so does the transparency and liquidity of the market as a whole.

What we’re hearing: One pension plan administrator gleefully told me that the IPO market is now dead and they hope to see companies remain private in perpetuity. Meanwhile, a big-name U.S. venture capitalist said that 75% of their liquidity over the past 12 months had come from selling private stakes to other investors on the secondary market.

  • In other words, private investors are happy to actively trade corporate stakes among one another, providing liquidity to early investors without the need for an IPO. Even employees are quietly being allowed to cash out, using services like Nasdaq Private Market.
  • Early-stage investors sell to later-stage investors who sell to strategic investors. Last month, for instance, SoftBank spent $1.3 billion just in buying up VCs' stakes in the Indian hotel company Oyo. And roughly 20% of VC exits now happen when companies get sold to private equity funds.

The other side: Public markets aren't serving early private investors particularly well. Uber, for instance, fetched $45 per share when it went public in May— but private investors have only been allowed to start selling their shares since yesterday.

  • The so-called "lockup expiration" has sent Uber's stock not only below its IPO price, but even below the $33.32 per share at which Uber raised $1.2 billion in June 2014. As a result, the overwhelming majority of outside Uber investors are now underwater.

The bottom line: The tens of thousands of people at Web Summit, not to mention the even larger private-market ecosystem in the U.S., owe their well-padded livelihoods to private finance.

  • The role of conferences like this one: To make the participants feel much more cool and glamorous than their post-IPO counterparts.

Go deeper: Venture capitalists on track for $100 billion in startup investments

Go deeper

29 mins ago - Health

CDC director says COVID-19 messaging should have been clearer

Rochelle Walensky. Photo: Stefani Reynolds-Pool/Getty Images

Rochelle Walensky, director of the Centers for Disease Control and Prevention, said in an interview with the Wall Street Journal that the messaging around the COVID-19 pandemic and changing guidance should have been clearer.

State of play: Walensky is being coached by media experts and is planning to have more press briefings by herself in order to ensure that CDC is seen as an independent, scientific entity, rather than as a political one, the Journal reports.

47 mins ago - World

UAE asks U.S. to reinstate Houthis terrorist designation after attack

Secretary of State Tony Blinken (left) listens to United Arab Emirates Foreign Minister Sheikh Abdullah bin Zayed al-Nahyan during a joint news conference at the State Department iin October. Photo: Andrew Harnik/Pool/AFP via Getty Images

Emirati Foreign Minister Abdullah Bin Zayed asked Secretary of State Tony Blinken in a phone call Monday to re-designate the Houthi rebels in Yemen as a terrorist organization, a senior Emirati official told Axios.

Why it matters: Less than a month after he assumed office, President Biden rolled back the Trump administration’s decision to make the designation. He said it hampered humanitarian assistance to the Yemeni people. Since then, the Houthis have escalated their attacks against Saudi Arabia and other countries in the region — including an attack Monday in Abu Dhabi.

Updated 1 hour ago - Economy & Business

World Bank: Gap between rich and poor countries is widening

Illustration: Sarah Grillo/Axios

For the last two decades, incomes in poorer countries were catching up to rich countries. The pandemic economy of the 2020s may reverse the trend, the World Bank warns in a new report.

Why it matters: Falling inequality between countries has been one of the most positive trends of the 21st century. If it reverses, it implies more human suffering and geopolitical instability.