lowtrade, Aren't you giving too much credit to the scumbags which run the pinksheet companies? Most of these, with a few exceptions, are ONLY in existence to serve as a phony business front for a stock scheme to make unethical & dishonest insiders wealthy. The company (cough, cough) itself can issue stock which can be sold by insiders directly into the PR pump & dump cycle which was created for their own benefit in the first place. There don't HAVE to be large investors of any kind, right? This stock scheme is exactly why a lot of pinksheets were formed via some originally defunct public shell in the first place. Hence, they can dilute directly into their own bogus PR stories.
But of course, everything you said is also true and is more relevant overall than what I am saying. I think you just left out one dirty aspect of the pinks/pennies/OTC.