I’ve been thinking a lot about silos, or lack thereof, within startupland. Sometimes an artificial wall is erected between companies in different stages of growth, when in reality they are all in the same room, clinking glasses and tripping over the same rug.
Let me be more precise. As the late-stage market has cooled for tech companies, many early-stage investors say their portfolio companies aren’t hurt too much because they are years away from an exit and have enough capital to weather the uncertainty. The same energy was on display this week at TechCrunch Early Stage. Stellation Capital’s Peter Boyce II sheepishly told me that based on the term sheet he wrote yesterday, we’re definitely still in a founder-friendly market, while a couple of entrepreneurs not-so-subtly reminded me that experimental bets are still making significant strides. financing rounds. .
I believe in optimism and I think of early stage startups right now as a correction, not a reckoning. But, new data from PitchBook and NVCA shows that dollars are changing across the board.
The latest report says that venture-backed companies attracted nearly $71 billion during the first quarter, down from the pace of all quarters in 2021 but still ahead of pre-pandemic totals. Digging deeper into the seed stage, the research team reports that seed deal sizes are beginning to look more toward historical norms than outsized nonsense (OK, OK, I made that last part up). At the same time, valuations continue to grow with a median pre-money valuation of $12 million. A funny dichotomy that investors have to pay a pretty penny for.