US Startup Valuation down by 24%

While this should not come as a surprise, it’s really important to note the % decrease in average valuation of startups in US.

As per data collated by Angelsoft (a software company that tracks valuation trends), valuations for funded startups in Q4 of 2008 fell by 24% when compared to Q3 of the same year.

The company’s software, which is used by more than 450 angel groups and venture funds worldwide, tracked a total of 128 deals in the quarter with a median pre-money valuation of $3 million. In the third quarter, it tracked 123 deals with a median value of $3.9 million.

Q4 numbers represent the largest quarter-to-quarter drop in the 4 years that it has been tracking company valuations. – source

This is an unfortunate truth which many startups do not acknowledge. Hence for VCs, while the deal flow is steady, outcome is not.

The tussle continues.

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