PitchBook summarized VC trends of the first half of 2022, released data suggesting positive economic outcomes for some start-ups.
Even with reported layoffs and weaker revenue growth at mature businesses, overall valuations have stayed in good shape, Pitchbook said.
State of early stage VC:
• QoQ early-stage valuations saw their first decline in ten quarters (as investors pull back)
• Deal values are increasing (QoQ +19%, as start-ups try to keep sufficient runway)
• Seed valuations grew by 33% since 2021 (maybe due to the time lag to fell the economic adverse conditions)
Late-stage VC has different picture:
• Deal value decreases (H1 22-on-full 2021 – 7%, as investors expect a delay in exits)
• Pre-money valuation is increasing (H1 22-on-full 2021 +10%)
Positive trends:
• The biggest jump was in early-stage biotech and pharma.
• Fintech saw seed and early-stage median valuations rise.
IPOs and the exit market was weak:
• Lack of IPOs — a shortage of liquidity. It means that the investors can not pull back their funds to invest in new deals or return to their limited partnerships.
• That would negatively affect new rounds and may translate in more thorough due diligence and protectionist terms if the current economic climate continues or worsens over the next 12 months.
https://fortune.com/2022/08/11/early-stage-vc-valuations-see-first-decline-in-10-quarters/?utm_source=Iterable&utm_medium=email&utm_campaign=reader&tpcc=reader
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