TLDR Tech / Opinion
Startup Valuations Require Adjustment
The author contends that current private startup valuations are misleading due to significant selection bias, as they represent only successful funding rounds at specific times, not the true average value across the entire startup landscape. By analyzing the rate at which Seed startups advance to Series A funding each quarter, a valuation index adjusted for this fundraising filter has been created. The results indicate that actual Seed valuations are considerably lower than publicly reported funding amounts, suggesting that new deal valuations are not reliable indicators for established companies.
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