and yet, most people use this same measure for market capitalization of companies.
The market is mostly reasonable about who can and will sell their shares. If a big mover does sell a lot of their shares at once, the price will fall. Most big holders will slowly sell off shares for this reason.
In the other direction, it’s also understood that the cost to acquire all shares of a company is more than the market cap of a company. This is why you see acquisition prices being significantly higher than the last funding round valuation, or public shares popping on announcement of an acquisition attempt.