Silicon Valley valuations, still strong, soften slightly in Q2

Silicon Valley VCs turn a bit more cautious on valuations in the second quarter, but continued to award startups healthy increases in follow-on financings.

The quarter’s average increase in round pricing slipped modestly from the first quarter, but still lifted share prices an average of 70 percent, compared with 74 percent, according to data from Fenwick & West. It was the third quarter in a row of slowing share-pricing hikes.

For the quarter, B-round increases were the strongest and C-round increases the weakest, according to Fenwick & West.

Overall, however, investment enthusiasm held strong. Up-round financings accounted for 78 percent of deals, a slightly higher percentage than in the first quarter. The percentage of down rounds fell slightly to 12.

Fenwick & West looked at 225 venture financings for companies headquarter in Silicon Valley.

Action Item: To learn more about the Fenwick & West study, go to https://bit.ly/2KdEB1n.