---
id: "prereq-public-vs-private-markets"
type: "prereq"
source_timestamps: ["00:11:00"]
tags: ["finance-basics"]
related: ["concept-private-equity-wealth-creation"]
reason: "Required to understand why the Accredited Investor rule is a barrier to wealth creation."
sources: ["secinsider"]
sourceVaultSlug: "damsker-sec-defi-wealth-creation-2026Jun25"
originDay: 7
---
# Understanding Public vs. Private Markets

## Prerequisite

The conversation assumes the audience understands the **fundamental difference between a publicly traded company and a private company**.

### Public Company
- Shares trade on a public exchange (e.g., NYSE, Nasdaq)
- Available to any retail investor with a brokerage account
- Subject to extensive SEC disclosure requirements (10-K, 10-Q, etc.)
- High liquidity, transparent pricing

### Private Company
- Shares are not publicly traded
- Investment is restricted by securities law (often to [[concept-accredited-investor-rule|Accredited Investors]] only)
- Shares are illiquid; selling requires finding a buyer or waiting for a liquidity event
- Disclosure is private; less transparency

## Why It Matters

Without this distinction, Damsker's central thesis — that the [[concept-accredited-investor-rule|Accredited Investor rule]] blocks the middle class from the most powerful [[concept-private-equity-wealth-creation|wealth-creation vehicle]] — does not make sense.

Related: [[entity-sec-d7]], [[framework-private-investment-playbook]].