PitchBook Reports Down Rounds Fall After Spike in Q2

When the COVID shut downs started in March 2020, most participants in the venture capital ecosystem thought we were heading towards another episode of down rounds, venture capital funds cutting off companies that they thought would not survive and less money available for new startups.  While we certainly saw this trend in the first few months of the shutdown, it was a relief to see that the trend did not continue.  

There has been a lot of speculation about why the extended downturn in the venture markets did not materialize.  Some commentators have attributed the rapid recovery in the financial markets to the quick and extensive intervention by the Federal Reserve and the Treasury Department.  Others have attributed it to the ability of technology companies to grow their businesses as they catered to the work-from-home crowd.  Others attributed it to the robust IPO market. 

Whatever the reason, it has been great to see that valuations and fundings have held up for the past few months - let's hope the trend continues!