Today I would love to share a very useful report.
Such companies like Pitchbook, Crunchbase, and Dealroom calculate the average deal size, valuation, and other different indexes.
And Stonks, together with Forum Ventures, decided to collect near-real-time data for 22Q4.
As you might know, there is dramatically little data for pre-seed and seed, so the most delicious part is that they focused on pre-seed and seed stages.
For this report, they interviewed over 80 investors about the deals they made in 22Q4, with a total of 124 deals data collected.
The numbers from their data are the following:
We can divide startups into three groups:
- Pre-revenue: median estimate $9M with $9.7M on average. You can see in their table numbers $10M/$10.7M, but in the text, they have this value. I believe in a table there is a typo.
- 0-$250K ARR: the median is quite close to the previous: $10M, but the average is $13M.
- $250K+ ARR: the median is $16M, an average of almost $20M.
|Traction||# Of Deals||Median Valuation||Average Valuation|
While looking into startups deeper, you can get these numbers:
- pre-revenue startups had deals with $15-31M valuations, however, 80% of startups had valuations below $11M.
- $250K+ ARR startups in 27% had deals with valuations below $11M.
- $14M is the average valuation for all 124 startups. This includes a web3 startup with a valuation of $55M. If do not include it, then the average valuation drops to $9.5M.
- 27% of the entire startups got a valuation below $10M, and 26% of the entire startups got a valuation above $20M.
The strange to me is a valuation of pre-revenue and 0-$250K is almost the same.
There is also interesting information:
- 58% of investors expect a decrease in valuations in 23Q1.
- 38% of investors expect valuations at the same level.
- Only 4% believe that ratings will rise.
- The average number of investments made in the last 2 quarters since the market turned was 2.
- According to the chart, about 40% of investors expect a drop in investments in 32Q1.
- And finally shocking data: according to TechCrunch, in 22Q3, women raised around 1.9% of all venture capital allocated (down from 2.4% in 2021).
Top 3 industries of the companies invested in:
- 20% for Fintech
- 11% for Future of Work
- 13% for Healthtech
The top three geographic areas represented in this data set were:
- 29% for Bay Area
- 22% for NYC
- 36% for Other
Since this report covers only US here you can see cities.
It’s pretty awesome to see such very data collected.
It makes you a better understanding of the current state of early-stage startup valuations and the prospects for the coming quarter ahead or even longer.
We also attached the report to this article.