The process is continuous, until the day Exxon dies or closes shop. The chain of "cashing out" needs to be maintained for the chain to even exist in the first place.

If there were no "secondary" investors, then the only way for an initial investor to reap their returns is via the profits generated, which can be many many years away.

But these "secondary" investors are in the same position - they may want to only invest for a set interval of time. So they have to "cash out" by selling to "tertiary" investors. And so on.

And as a company becomes more mature, their expected returns are more certain, and also lower (i.e., lower risk). So the tertiary investors are people who don't want to take high risks, and want a steady stream of income.

The problem i have with a lot of people's misconception is that they think that buying/selling shares are useless activities, and does not benefit the overall economy.