Depending on who is doing the valuation, I'm sure this is already a consideration. Like when Coinbase acquired Earn for $110m-ish. Was Earn worth that? Absolutely not. Since Coinbase and Earn shared investors, it was merely a convenient way for those investors to pay themselves out of the unexpected billion dollar cash pile Coinbase amassed in 2017.
Dividend means taxes . Buyback requires someone to sell (I.e. exit) usually no one wants[1] to especially when the company is going hot. investors would rather have (more)stock in a hot company than cash.
Fund managers and staff have also disincentives for early exits, i.e. they have to find and invest in another company and cannot just keep the money, which means more work. They rather exit by switching stock to a hotter in demand, hard to get in companies if they can.
[1] there are always some employees and founders who would prefer some liquidity , but either they don’t hold large enough positions (employees) or investors don’t want to give a lot of liquidity (founders)
For public companies it is different- buybacks work because there is always someone ready to sell. Usually retail but also short term funds who don’t care about liquidating. ETFs and other very institutional investors or those into buffet style long term investments will not sell easily
