Average ratings for startups are in decline, new data shows.
In March, The Exchange analyzed a dataset from Carta, a unicorn whose software helps companies manage their cap table, revealing early indications that the startup valuation market was changing. A look at Carta’s full Q1 data gathered by the head of insights, Peter Walker, clarifies the situation: valuations are declining, but not evenly.
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Indeed, new data shows a spectrum of declines in the average valuation for startups Carta has a view on: thousands of deals from tens of thousands of companies – which matches current venture capitalist chatter that the value of startups has changed dramatically since the highs of 2021.
Outliers will remain for founders and investors alike. Some startups will be able to raise like it’s 2021, but for most budding tech concerns, the old standards are out the window.
Let’s explore new numbers from Carta this morning, using raw data and seeing where valuations are falling fastest and slowest. If you’re building or investing, this is the new reality.
We’re writing ahead of Carta’s impending report, so we don’t have fancy charts to borrow from the company’s data team. We continue in the text for today. It doesn’t matter, start early and go late, here’s what Carta has to say about valuations: