Stock prices of fast-growing software companies have been on a steep descent since late November.  Shares of of these businesses have plummeted on average about 60% off their recent 12-month highs, according to a recent report from Meritech Capital.

While some late-stage investors started to adjust valuations in response to the stock market sell-off at the beginning of the year, PitchBook data shows that prices for venture capital deals for SaaS companies still have not fallen nearly as far as their public comparables.

The median valuation of a late-stage software company dropped to $155 million in 2022, representing a 23% decline from the previous year. However, software valuations are still significantly higher than they were prior to 2021.

Meanwhile, valuations of early-stage deals, which tend to be more isolated from stock market volatility, have continued to climb, reaching a record of almost $98 million, a 63% increase from last year's median value for SaaS startups at Series A and Series B. Farthest from the public markets, angel and seed deals have been mostly immune to valuation pressures, rising to a median value of over $16 million, a 28% increase from 2021.

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