The proportion of down rounds across US venture deals rose to 13.6% in the second quarter, as the sudden and sweeping effects of the pandemic squeezed the economy. That was the highest percentage of deals done at lowered valuations since late 2017. Many felt that the pressure on founders to acquiesce on deal terms might be sustained—if not increase—throughout 2020.
The data shows that hasn’t been the case. This Q3 US VC Valuations Report examines the return of founder-friendly terms and the measures that startups have taken to extend their capital runways. Other highlights from the report include:
- Nontraditional investors continue to drive huge late-stage valuations
- Median IPO valuations have flourished, while acquisition valuations were mixed
- A spotlight on trends within enterprise tech, consumer tech, biotech and more.