03 February 2022 |

2/3/2022: Chart of the Day

By Alan Soclof

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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.