The Takeaway
The Morningstar PitchBook Global Unicorn Index, a proxy for the late-stage venture market, trailed public markets in the first quarter of 2023—supporting the notion that private company valuations generally lag public equity prices.
Private market valuations of many unicorns have seen a drastic decline in the first quarter, with global payments firm Stripe, a bellwether for the late-stage market, seeing its valuation halved from USD 95 billion to an estimated USD 50 billion in the latest fundraise.
A confluence of macroeconomic factors that created headwinds for late-stage venture in the latter half of 2022 were further exacerbated by destabilization in the funding ecosystem caused by the collapse of Silicon Valley Bank and Signature Bank in the first quarter of 2023. Further, as interest rates continue to rise, an industry built upon abundant investor funding is feeling the pinch.
Leveraging the recently launched Morningstar PitchBook Global Unicorn Indexes, we provide a wealth of data-driven insights on the risks and rewards looming in the late-stage venture markets. The Morningstar PitchBook Global Unicorn Indexes dynamically track trends in this segment using a proprietary mark-to-model pricing methodology, allowing investors to stay up to date on daily valuations based on private assessments as well as comparable public stock prices.
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