03 February 2022 | Venture Capital
2/3/2022: Chart of the Day
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![](https://ci4.googleusercontent.com/proxy/0FEr1XNigbfyXWlApfsR8sj7WNqeRB2z8lPRS6RpmqxHTjL2KZLsHXDHRyGZRP8v_edUyQaLhPSbi-j6wOHKvuL00LlMotgHgPOuX2bC-wCnazy1qQQh2lxZveNvvRv0PMxTputI=s0-d-e1-ft#https://i4.cmail20.com/ei/y/70/3DB/341/103009/csfinal/unnamed-5-9901450145028a3c.png)
This chart is from a must-read piece in the WSJ about the valuation cuts hitting the startup industry.
Main takeaway? The 2021 P/S ratio for US tech companies that IPOd was 15.2 vs. 8.1 in 2019 – nearly doubling in 2 years.
And this increase didn’t only affect companies that went public — it hit startups, too. US startups valuation hit $4.5T in 2021, also nearly doubling from 2019.
Also- really interesting to note that in 1999 (dotcom bubble), the P/S was 2x that of 2021. Question for all the Gen Xers: Did y’all know how crazy things were while they were happening?
I just wish I wasn’t two in ‘99 and could have experienced the craziness for myself – and I wish Twitter was around too to hear everyone’s thoughts.