1、USVC ValuationsReportSponsored by2024ANNUAL2ContentsSponsored by2024 ANNUAL US VC VALUATIONS REPORTMarket overview2Dealmaking6SaaS9A word from Morgan Stanley at Work10Climate tech12Investor trends13Liquidity16Kyle Stanford,CAIA Director of Research,US Venture Emily Zheng Senior Analyst,Venture Capit

2、al DataCollin Anderson Senior Data APublishingReport designed by Drew Sanders and Josie DoanPublished on February 10,2025Click here for PitchBooks report methodologies.Click here for PitchBooks private market glossary.PitchBook Data,Inc.Nizar Tarhuni Executive Vice President of Research and Market I

3、ntelligencePaul Condra Global Head of Private Markets Research Kyle Stanford,CAIA Director of Research,US VentureInstitutional Research GroupAnalysis 2025 Morgan Stanley Smith Barney LLC.Member SIPC.CRC4109493 12/2024Morgan Stanley at Work services are provided by Morgan Stanley Smith Barney LLC,mem

4、ber SIPC,and/or its affiliates,all wholly owned subsidiaries of Morgan Stanley.What can you do today to be set up for success tomorrow?Discover what steps you can take to stay transaction ready and manage the expectations of your shareholders ahead of a liquidity event.Are you considering running a

5、liquidity event?When IPOs were the logical next step for late-stage private companies,employees often had a clear pathway to turn their equity compensation into cash.With companies staying private longer,those opportunities for liquidity have dwindled.This has sparked a rise in issuer-led liquidity

6、events,such as tender offers and secondary transactions.However,companies may underestimate the amount of work required,which can lead to costly transaction delays.Request a Free Transaction Readiness Assessment4Sponsored by2024 ANNUAL US VC VALUATIONS REPORTMARKET OVERVIEWMarket overview27.5%26.4%3

7、2.7%34.9%14.1%13.7%2.4%5.6%0%20%40%60%80%100%120%140%20142015201620172018201920202021202220232024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,202414.3%15.7%0%3%6%9%12%15%18%20142015201620172018201920202021202220232024Source:PitchBook Geography:US As of

8、 December 31,2024Liquidity,or the lack thereof,continues to strain the already-parched venture market.Without large exits,an ever-growing stockpile of startups has locked up over$4 trillion in the private markets,which is more than double 2020s market value of$1.7 trillion.LPs stuck with larger-than

9、-anticipated venture portfolios are hesitant or lack the means to commit more to the asset class.Though investors have been optimistic about the Federal Reserves(the Feds)interest rate cuts boosting exit activity,the two forecast cuts for 2025 would be welcome but would not realistically jump-start

10、venture given that 2024s three cuts barely moved the needle.Fundamentally,the largest hurdle between startups and exit opportunities is high valuations.Private company prices increased rapidly during the zero-interest-rate-policy(ZIRP)erathe median early-stage startup more than doubled its valuation

11、 on an annual basis in 2021 and 2022.Now,ventures big contradiction and challenge is that the pasts unbridled growth is preventing startups from moving forward,trapping them in golden handcuffs.These companies would like to prevent down rounds and their negative ramifications,such as dilutions for e

12、mployees and investors without protections.As a result,median valuations have remained high across venture series and stages.However,the median annualized valuation growth between rounds,or relative velocity of value Annualized valuation growth muted due to previously high valuations Median RVVC bet

13、ween rounds by stageDownward pressure on valuationsDown and flat rounds as a share of all VC roundscreation(RVVC),has plummeted since the highs of 2021.Down and flat rounds are becoming not only increasingly common,occurring for nearly 30%of 2024 deals,but also 5Sponsored by2024 ANNUAL US VC VALUATI

14、ONS REPORTMARKET OVERVIEWinevitable for many startups that need to secure more funding or garner enough investor interest for an exit.One of the most successful exits of 2024 was Reddit,though the company had to cut its valuation to less than half of its peak in order to file for IPO.Now,Reddits mar

15、ket cap has soared over$37 billion,so decreasing its price was a worthwhile gamble.Until more startups are willingor,more realistically,forcedto consider lowering their valuations to exit,ventures recovery will be much slower than the market needs.A silver lining is that the market is moving toward

16、becoming more startup friendly.Valuations remain high in new rounds due to the relative strength of dealmaking activity and declining investor protections such as dividends.AI has spurred this trend,accounting for nearly 30%of deal count and over 46%of deal value in 2024,as investor appetite for the

17、 technology remains unsatiated while other sectors bear the brunt of ventures capital scarcity.AIs influence is especially strong for larger startups,constituting 47.5%of 2024 deals for companies valued over$500 million.The technologys unbridled growth is also reflected in rising valuations,as the 2

18、024 median step-up for Series D+startups was 1.7x for solely AI companies,compared with 1.2x overall.As AI startups continue garnering higher valuations,dealmaking will move toward more of a balance between startup and investor friendliness.0102030405060708090100Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q

19、3Q4Q1Q2Q3Q4Q1Q2Q3Q42018201920202021202220232024Early-Stage IndexLater-Stage IndexVenture-Growth-Stage IndexStartup friendlyInvestor friendlySource:PitchBook Geography:US As of December 31,2024The market remains in investor favor,though it is moving toward becoming more startup friendly US VC Dealmak

20、ing Indicator7.2%7.1%6.8%6.9%7.0%7.1%7.2%7.3%7.4%201420152016201720182019202020212022 2023 2024Source:PitchBook Geography:US As of December 31,2024Average dividends decline alongside overall investor friendlinessAverage dividend6Sponsored by2024 ANNUAL US VC VALUATIONS REPORTDEALMAKINGDealmaking$0$5

21、0$100$150$200$25020142015201620172018201920202021202220232024Top and bottom quartile rangeTop decileMedianBottom decileAverageSource:PitchBook Geography:US As of December 31,202420142015201620172018201920202021202220232024Early-stage VCLate-stage VCVenture growth1.31.41.82.01.51.700.30.60.91.21.51.8

22、2.1Source:PitchBook Geography:US As of December 31,2024Venture dealmaking has been restrained for nearly three years.Despite the prolonged slowdown as interest rates and inflation remain high,median valuations in 2024 grew across all venture stages compared with the past two years.However,a deeper a

23、nalysis of the data reveals that even though median valuations are elevated,growth between rounds has been slim because these valuations are remnants of the ZIRP eras inflated company prices.This conclusion is further evidenced by the median time between rounds,which has been steadily growing since

24、2022.Startups are reaching the end of their cash runways and are therefore coming back into the market years later,often with pricing similar to that of their most recent rounds that,for many,were during the pandemicover half of Series C and D+startups that completed a round in 2024 last raised over

25、 two years ago.Startups are finding it difficult to keep up with the ambitious growth trajectories they set when capital flowed much more freely.As a result,26%of rounds in 2024 were flat or down,which is the greatest percentage in a decade.Rather than taking median valuations at face value,better r

26、eflections of the state Elevated valuations influenced by AI and ZIRP-era highs Early-stage VC pre-money valuation($M)dispersionStartups waiting longer to raise capitalMedian time(years)between rounds7Sponsored by2024 ANNUAL US VC VALUATIONS REPORTDEALMAKINGof VC include RVVC,which remains at or nea

27、r decade lows for most stages,and the median step-up by series.The median annualized valuation growth between rounds for later-stage startups is at a decade low of 13.7%,which is a 78.8%decrease from 2021.Compared with 2023,step-ups have increased across all company stages,though their magnitude con

28、tinues to be modest.For example,the median Series D+companys step-up is only 1.2x,which is barely an increase from the previous round and nearly half of the growth levels observed in 2021.This trend will only be exacerbated in 2025 when more companies finally raise their first post-pandemic rounds.O

29、n the other hand,AI valuations have soared,which is another reason why venture valuations seem stronger than the overall markets actual performance.AI dominated the venture narrative and dealmaking activity in 2024,capturing 46.4%of the years total deal value.The top five deals of 2024 were all in t

30、he AI sector.An even starker contrast between AI companies and the rest of venture is the rapid valuation growth across multiple rounds completed by OpenAI,xAI,and Anthropic in a year when many startups struggled to complete even one.0%20%40%60%80%100%20142015201620172018201920202021202220232024Down

31、FlatUpSource:PitchBook Geography:US As of December 31,2024Greatest percentage of flat and down rounds in a decade Share of VC deal count by up,down,and flat rounds$11.5$16.8$5.6$6.8$0$5$10$15$20$25$30$35$40Early-stage VCLate-stage VC20142015201620172018201920202021202220232024Source:PitchBook Geogra

32、phy:US As of December 31,2024Slow but rising pace of value creationMedian VVC between rounds by stage8Sponsored by2024 ANNUAL US VC VALUATIONS REPORTDEALMAKING1.5x1.6x1.4x1.5x1.2x1.3x1.1x1.2x1x1.3x1.6x1.9x2.2x2.5x20142015201620172018201920202021202220232024Series ASeries BSeries CSeries D+Source:Pit

33、chBook Geography:US As of December 31,2024Valuation growth between series low but rising Median step-up by seriesOpenAI nearly doubled its valuation,and xAI grew from a$500 million pre-money valuation in January 2024 to a$50 billion post-money valuation by the end of the year.Similarly,Anthropic sta

34、rted 2024 with an$18.2 billion pre-money valuation and may reach a$60 billion post-money valuation in its next round,which is speculated to close in early 2025.Tailwinds from lower interest rates,elevated investor interest in AI,and the return of startups that have been waiting on the sidelines will

35、 likely continue pushing up dealmaking activity and median valuations in 2025.However,outsized valuation growth between rounds will likely be concentrated among top players,most of which are AI startups,rather than being evenly distributed across venture.9Sponsored by2024 ANNUAL US VC VALUATIONS REP

36、ORTSAASSaaS$13.5$12.0$33.0$53.0$73.5$47.2$185.0$560.0$0$200$400$600$800$1,0002014 20152016 2017 2018 2019 2020 2021 2022 2023 2024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,20241.0 x1.5x2.0 x2.5x3.0 x201420152016 2017 2018 2019 2020 2021 2022 2023202

37、4SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,2024$3.2$5.2$6.7$16.0$3.3$7.5$10.0$13.2$0$15$30$45$60$752014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,202

38、425.0%25.0%21.4%21.2%19.3%17.4%10.8%9.1%0%5%10%15%20%25%30%201420152016201720182019202020212022 2023 2024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,2024Higher valuations driven by ZIRP-era roundsMedian SaaS VC pre-money valuation($M)by stageStep-ups

39、are nearing pre-pandemic levelsMedian SaaS VC valuation step-up by stageSoftware as a service(SaaS)deal value trending up for most stagesMedian SaaS VC deal value($M)by stageVC firms are acquiring smaller stakes in SaaS companiesMedian SaaS VC share acquired by stage102024 ANNUAL US VC VALUATIONS RE

40、PORTA WORD FROM MORGAN STANLEY AT WORKSponsored byA WORD FROM MORGAN STANLEY AT WORKEvolving pathways to liquidityWhat is Morgan Stanley at Work?Morgan Stanley at Work provides workplace financial benefits that help build financial confidence and foster loyaltyhelping companies attract and retain ta

41、lent.Our end-to-end offering spans equity,retirement,deferred compensation,executive services,and saving and giving solutions.Each solution includes a powerful combination of modern technology,insightful support,and dedicated service,providing your employees with the knowledge and tools to help make

42、 the most of their benefits and achieve their life goals.Whether preparing for a liquidity event or an IPO,planning a release of restricted stock units,or expanding your equity plan,Morgan Stanley at Work can help you take charge of where you are today and where youre going next.What trends are you

43、seeing in the private market liquidity space?There was a time when the logical pathway to liquidity for private companies was to engage in an IPO.Today,however,private companies have greater access to capital than in the past.That trend,coupled with ongoing market uncertainty,has resulted in many co

44、mpanies choosing to stay private for longer.While this often makes sense from an operational perspective,it could leave employees at private companies without a clear pathway to turn their equity compensation into cash.This can present a challenge for companies that use equity compensation to attrac

45、t talent and motivate their workforce.Absent a liquidity event,private companies may struggle to keep employees engaged and motivated,given the inability to recognize the value they helped generate,and could increase the risk of losing their key talent tocompetitors.These converging forces help to e

46、xplain why weve seen a rise in issuer-led liquidity events,such as tender offers.A tender offer is a type of secondary transaction,led by the issuer,that allows private company equityholders to sell some of their equity back to the company or to an outside investor.Shawn MurphyManaging Director Head

47、 of Private Markets at Morgan Stanley at WorkShawn has more than 20 years worth of experience across financial services,fintech,microfinance,equity management,and private markets.Shawns team delivers equity management,liquidity,and workplace solutions to private companies and investors.In her role,S

48、hawn oversees growth initiatives from expansion into new and adjacent products to evolving existing capabilities.Tender offers provide private companies with a way to reward their employees and foster a sense of ownership,while still retaining control over their cap table.If theyre funded by an outs

49、ide investor,they can also create space on the cap table for value-add shareholders without causing dilution.This makes them a win-win for private companies,employees,and investors alike.How can private companies prepare for a tender offer?Given the critical role tender offers can play for private c

50、ompany stakeholders,advance preparation is key.For most companies,this starts by identifying their business goals so they can properly structure the offer and configure their equity administration platform.Elements to consider may include shareholder eligibility parameters,maximum and/or minimum sel

51、ling amounts,open selling windows,and more.Timing is key.Many companies report that their tender offer process takes more time than anticipated.Team members need sufficient runway to navigate the offers complex compliance requirementsfrom preparing financial documentation and reorganizing equity pla

52、n documents to communicating with both internal and external teams.By leaving time for testing and feedback,companies can streamline the launch in a way that simplifies workflows.Once the tender offer goes live,companies will also want to make sure that stakeholders have a clear process to follow.Th

53、is may mean enabling participants to follow the 112024 ANNUAL US VC VALUATIONS REPORTA WORD FROM MORGAN STANLEY AT WORKMorgan Stanley Smith Barney LLC(“Morgan Stanley”),its affiliates and Morgan Stanley Financial Advisors or Private Wealth Advisors do not provide tax or legal advice.Clients should c

54、onsult their tax advisor for matters involving taxation and tax planning and their attorney for legal matters.Employee stock plan solutions are offered by E*TRADE Financial Corporate Services,Inc.,Solium Capital LLC,Solium Plan Managers LLC and Morgan Stanley Smith Barney LLC(“MSSB”),which are part

55、of Morgan Stanley at Work.Morgan Stanley at Work services and stock plan accounts are provided by wholly owned subsidiaries of Morgan Stanley.Morgan Stanley at Work stock plan accounts were previously referred to as Shareworks,StockPlan Connect or E*TRADE stock plan accounts,as applicable.In connect

56、ion with stock plan solutions offered by Morgan Stanley at Work,securities products and services are offered by MSSB,Member SIPC.E*TRADE from Morgan Stanley is a registered trademark of MSSB.All entities are separate but affiliated subsidiaries of Morgan Stanley.The laws,regulations,and rulings addr

57、essed by the products,services,and publications offered by Morgan Stanley and its affiliates are subject to various interpretations and frequent change.Morgan Stanley and its affiliates do not warrant these products,services,and publications against different interpretations or subsequent changes of

58、 laws,regulations,and rulings.Morgan Stanley and its affiliates do not provide legal,accounting,or tax advice.Always consult your own legal,accounting,and tax advisors.2025 Morgan Stanley.All rights reserved.CRC 4111865 12/2024transaction from start to finish by providing them with a view of their c

59、urrent holdings,their exercise costs,and even their tax withholding estimates before they tender any shares.Similarly,it could involve centralizing data in one secure place so equity plan administrators can easily share liquidity event updates in real time.The role of education in this process is pa

60、ramount to success.Employees should understand not only the tax implications associated with a tender offer,but also the financial implications.Many employees may not know how to calculate their tax obligations or invest their newfound liquidity.Companies can help with this uncertainty by offering e

61、ducationas well as access to financial advisorsbefore,during,and after the tender offer takes place.With companies staying private for longer,how can they keep their employees engaged?In our 2024 State of the Workplace Financial Benefits Study,HR leaders and employees alike agreed that workplace ben

62、efits help enhance employee loyalty.This spans from financial benefits to access to financial advisors.Adding equity compensation to the mix was considered the most effective way to further boost employee motivation and engagement.Given these findings,benefits awareness and education represent funda

63、mental areas of focus.Many employees do not fully understand their benefits packages or the role that equity compensation can play in their personal wealth management.Creating a robust learning curriculum,offering virtual and in-person education sessions,and providing employees with access to educat

64、ional resources are just some of the ways private companies can keep employees engaged and inspired.Beyond helping to reduce their financial stress,this can help build their confidence and foster a culture that encourages employees to make the most of their financial workplace benefits.Sponsored by1

65、2Sponsored by2024 ANNUAL US VC VALUATIONS REPORTCLIMATE TECHClimate tech$12.2$13.0$42.3$44.3$68.0$82.8$90.0$300.0$0$50$100$150$200$250$300$350$400$4502014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,202

66、4SeedEarly-stage VCLate-stage VCVenture growth1.0 x1.5x2.0 x2.5x3.0 x3.5x201420152016201720182019 2020 20212022 2023 2024Source:PitchBook Geography:US As of December 31,2024$4.0$3.5$10.0$8.9$10.0$12.0$16.1$31.7$0$5$10$15$20$25$30$35$4020142015201620172018201920202021202220232024SeedEarly-stage VCLat

67、e-stage VCVenture growthSource:PitchBook Geography:US As of December 31,202426.7%26.0%24.1%25.5%18.0%24.2%19.2%17.8%0%5%10%15%20%25%30%35%2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024SeedEarly-stage VCLate-stage VCVenture growthSource:PitchBook Geography:US As of December 31,2024Late-stage

68、valuations hit new high medianMedian climate tech VC pre-money valuation($M)by stageLate-stage step-ups lowest since 2017Median climate tech VC valuation step-up by stageEarly-and late-stage deal values recoverMedian climate tech VC deal value($M)by stageAcquired stakes tick up for early-stage deals

69、Median climate tech VC share acquired by stage13Sponsored by2024 ANNUAL US VC VALUATIONS REPORTINVESTOR TRENDSInvestor trends20142015201620172018201920202021202220232024Nontraditional investorNo nontraditional investor$45.3$62.0$24.4$36.3$0$10$20$30$40$50$60$70Source:PitchBook Geography:US As of Dec

70、ember 31,2024$74.0$93.0$29.5$40.0$0$20$40$60$80$100201420152016201720182019 202020212022 2023 2024Nontraditional investorNo nontraditional investorSource:PitchBook Geography:US As of December 31,2024Our recent VC Tech Survey highlighted some of the challenges within the current market.“Private marke

71、t pricing too high”was the second-largest challenge noted by investors,with the other challenges all surrounding liquidity.These factors are all intertwined.High pricing,which restricts buyers,is in direct conflict with compressed public market multiples and hinders the available liquidity from publ

72、ic investors.Nontraditional investors are at the precipice of many of these challenges.They invest in the largest,highest-priced deals and can be buyers in M&A or provide liquidity for IPOs and in the public market.Though not necessarily the creators of these challenges in all cases,the pullback of

73、nontraditional investors from the venture market has left a capital void in dealmaking on the liquidity side.A large factor in the liquidity challenges of the market has been at the very least exacerbated by the high activity levels of these institutions during the ZIRP era.Median pre-money valuatio

74、n points to high barMedian early-stage VC pre-money valuation($M)with nontraditional investor participationLate-stage median surpassed by 2021 onlyMedian late-stage VC pre-money valuation($M)with nontraditional investor participation14Sponsored by2024 ANNUAL US VC VALUATIONS REPORTINVESTOR TRENDSHig

75、hly priced deals that involve nontraditional investors continue to occur,of course.The median early-stage pre-money valuation for a deal with nontraditional investor involvement reached a record high in 2024 at$62 million,which was 72%higher than deals without nontraditional investor involvement.$65

76、.0$59.0$67.5$40.2$40.0$116.1$76.5$156.1$145.0$486.5$0$100$200$300$400$500CVC investorPE investorAsset managerGovernment/SWFOther tourist investor20142015201620172018201920202021202220232024Source:PitchBook Geography:US As of December 31,2024Asset managers pushing valuations higherMedian pre-money va

77、luation($M)by investor type$29.7$40.2$40.4$38.2$73.5$67.4$89.9$178.4$115.6$84.7$107.51,6771,9191,8932,1372,4832,6742,8084,2614,0142,7552,41320142015201620172018201920202021202220232024Deal value($B)Deal countSource:PitchBook Geography:US As of December 31,2024CVCs hit breaks on deal countVC deal act

78、ivity with CVC participationThe lower count of deals with nontraditional investor involvement surely accounts for some bias,but the overall trend signals the willingness for these investors to pay significantly higher prices for quality deals.15Sponsored by2024 ANNUAL US VC VALUATIONS REPORTINVESTOR

79、 TRENDS57.5%56.2%23.9%22.8%0%10%20%30%40%50%60%20152016201420172018201920202021202220232024Deal valueDeal countSource:PitchBook Geography:US As of December 31,2024CVC deal proportion slips furtherVC deal activity with CVC participation as a share of all VC deal activityCorporate spending on VC-backe

80、d equity in 2024 continues to be a testament to the revolutionary interest in AI companies.Corporates were involved in more than$107 billion in equity deals during the year,despite overall deal count coming in at the lowest total since 2019.The median valuation of early-stage deals reached a new ann

81、ual high,which was surpassed only by 2021 values in both late-stage and venture-growth valuations.These high figures come as the proportion of corporate venture capital(CVC)activity focusing on AI companies has grown from 22.5%of deals in 2021 to nearly 32%in 2024.16Sponsored by2024 ANNUAL US VC VAL

82、UATIONS REPORTLIQUIDITYLiquidity$0$500$1,000$1,500$2,00020142015201620172018201920202021202220232024Top and bottom quartile rangeTop decileMedianBottom decileAverageSource:PitchBook Geography:US As of December 31,2024Rebound skewed by fewer outcomesVC exit valuation($M)dispersion20142015201620172018

83、201920202021202220232024Top and bottom quartile rangeTop decileMedianBottom decileAverage$0$1,000$2,000$3,000$4,000$5,000Source:PitchBook Geography:US As of December 31,2024IPOsThe few large tech IPOs that occurred in 2024 highlighted the valuation problems that the market is currently struggling th

84、rough,and that has added a high barrier to entry for startups looking to exit in public markets.During the year,five tech unicorns went public,two of which took significant markdowns on their offerings.Reddits IPO in Q1 2024 gave the company a roughly 50%lower valuation,while ServiceTitan took a pri

85、ce that valued the company roughly 18%lower than its previous VC round post-money valuation and was nearly 35%lower than its high-water-mark valuation from mid-2021.Though ServiceTitans market cap has rebounded and investors have recouped some of the losses,it remains below its high.Rolling median s

86、tep-up figures for public listings as a whole have been poor over the past couple years.Five of the past eight quarters have shown figures in this category under 1x,meaning the median step-up was,in fact,a step-down.Multiples in the public market tell most of the story of halted listings.The median

87、price/sales ratio of recently public VC-backed companies has inched back to around 6x and has trended between 4.5x and 6x since mid-2022.The multiples of 20 x and above from 2021 were incredibly relevant to the Public listings show wide spreadPublic listing VC exit valuation($M)dispersion17Sponsored

88、 by2024 ANNUAL US VC VALUATIONS REPORTLIQUIDITY2011-2013 median:7.74x2014-2016 median:4.57x2017-2019 median:6.28x2020-2021 median:12.73x2022-YTD median:5.61x0 x5x10 x15x20 x25x20112012201320142015201620172018201920202021202220232024Source:PitchBook Geography:US As of December 31,2024Price/sales rati

89、o has recovered for VC-backed techVC-Backed IPO Index price/sales multiple excluding biotech&pharmahigh prices being paid during that time in the private market.Though several of the tech IPOs of the last year did have successful pricings and traded well after listing,the idea that public market inv

90、estors are readily willing to pay the prices needed for the majority of tech companies looking to list is not supported by the compressed multiples in public company pricing.Tech,where a large majority of private market value is held,is also the sector that must contend with high valuations the most

91、.Over the past three years of IPO drought,the number of companies that now fit similar metrics of age,valuation,and amount raised by listing companies before the slowdown has more than doubled.Though private market pricing has shifted and is relatively lower than during 2021,down rounds have not mad

92、e up the proportion of completed deals that was certainly expected.Extended periods between rounds may have allowed some companies to grow into their valuations up to a point,though revenue growth is likely to have slowed,hampering that prospect for many of the unicorns waiting to IPO.M&AM&A data co

93、ntinues to show the structural problems with the venture market.83%of M&A transactions had unreported values in 2024,the highest figure in the dataset.Rather than there being a problem with reporting,the high figure shows the lack of demand from buyers for startups,whether due 0.0 x0.5x1.0 x1.5x2.0

94、x201420152016201720182019 2020 2021 2022 2023 2024Public listingAcquisitionSource:PitchBook Geography:US As of December 31,2024Median public listing step-up remains lowMedian VC step-up at exit by typeto mismatched pricing realities or a lack of worthy targets for large purchases.Additionally,antici

95、pated changes to the Federal Trade Commission are expected to relax the regulatory burden on corporates looking to make startup acquisitions,though the pricing issues for large acquisitions will remain.Just$82.6 billion in estimated exit value was realized through M&A in 2024,marking the lowest amou

96、nt in a decade.The 18Sponsored by2024 ANNUAL US VC VALUATIONS REPORTLIQUIDITY0%10%20%30%40%50%60%70%80%90%100%20142015201620172018201920202021202220232024D+CBASeedPre-seedSource:PitchBook Geography:US As of December 31,2024Acquisitions occurring earlyShare of VC round count by series where next roun

97、d is an exit via acquisitionlargest deal of 2024 is also contingent on development milestones for additional payouts.The$8.4 billion acquisition of SystImmune includes$800 million up front and$500 million in contingent near-term payments,with the final$7.1 billion paid after milestones for developme

98、nt,regulatory processes,and sales performances have been reached.1Big Tech has been on the sidelines of M&A for several years.The 10 largest tech companies in the US made just 12 acquisitions in 2024.During 2015,those same companies acquired 55 companies.Though it is true that AI and the quasi-acqui

99、sitions brought by the race to lead that sector have taken up time and money available for other acquisitions,without the outlet of VC-backed companies to incumbents,the return outlook for the market sours.The higher the acquisition prices,the fewer potential acquirers there are.And if those buyers

100、are not in the market,the options become grim.The largest acquisition made by these companies in 2024 was the$1.9 billion buyout of Own Company by Salesforce.Beyond that,the next-largest acquisition of a US company by these tech corporates was for Spiff,valued at just$419 million and also sold to Sa

101、lesforce.SecondariesSecondary sales can shed some light on the pricing of the market,though not without certain caveats.Secondary market pricing has rebounded nearer to a balance between discounts and premiums to a companys most recent private round,according to our recent analyst note Year of the I

102、PO Window.This data stems only from completed sales,and combing through activity levels through brokered secondary trades shows that activity levels are not especially strong outside of the most well-known,highest-valued companies.This suggests several themes:First,little demand remains for startup

103、shares below a certain brand level;and second,little desire exists for liquidity below a certain valuation.While both could simultaneously be true,it presents the valuation dilemma that VC has developed.Selling too early caps returns below the needed return on risk,and buying too early introduces un

104、wanted risk into the portfolios ofinvestors.This dilemma is also represented through tender offers from large companies choosing to remain private rather than listing shares publicly.Databricks,Stripe,OpenAI,and SpaceX have each raised billions in new capital to use toward share buybacks from employ

105、ees and early investors.Using cash for such tender offers is a novel way for companies to remain private.However,likely only a handful of companies are left that are able to raise enough fresh capital to replace the liquidity needed,and secondaries in general remain a small fraction of the liquidity

106、 needed by the industry as a whole.1:“SystImmune and Bristol Myers Squibb Announce a Global Strategic Collaboration Agreement for the Development and Commercialization of BL-B01D1,”Bristol Myers Squibb,December 11,2023.Additional researchCOPYRIGHT 2025 by PitchBook Data,Inc.All rights reserved.No pa

107、rt of this publication may be reproduced in any form or by any meansgraphic,electronic,or mechanical,including photocopying,recording,taping,and information storage and retrieval systemswithout the express written permission of PitchBook Data,Inc.Contents are based on information from sources believ

108、ed to be reliable,but accuracy and completeness cannot be guaranteed.Nothing herein should be construed as any past,current or future recommendation to buy or sell any security or an offer to sell,or a solicitation of an offer to buy any security.This material does not purport to contain all of the

109、information that a prospective investor may wish to consider and is not to be relied upon as such or used in substitution for the exercise of independent judgment.Private marketsQ4 2024 PitchBook-NVCA Venture MonitorDownload the report here2025 US Venture Capital OutlookDownload the report hereQ4 2024 European Venture ReportDownload the report hereQ1 2025 Analyst Note:US VC-Backed IPO ExpectationsDownload the report hereQ4 2024 Analyst Note:Evolving Economics of 10-Year Fund CycleDownload the report here2025 EMEA Private Capital OutlookDownload the report hereMore research available at