💥 Metric Minimalism, Software Valuation Trends, Gender and Race of Unicorn Founders, Predicting Seed Stage Success & More
Digesting Insights From the Data
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Valuation Trends for US Software Startups in 2024
Peter Walker’s snapshot of US software startup valuations for 2024 reveals the full spectrum, from the 10th to the 95th percentile. While headlines often highlight “Bonkers” valuations, the real story lies in the median and lower-percentile trends that show a nuanced recovery and challenges across stages.
Median Resilience: Median valuations are solid across all stages, rivaling past peaks in early rounds, even amidst reduced deal volume.
“Bonkers” Dominated by AI: The highest valuations (95th percentile) reflect the AI boom, with some figures matching 2021 highs.
Series D Struggles: Valuations at the 10th and 25th percentiles for Series D rounds dipped significantly, showing the effects of major down rounds over the past year.
✈️ KEY TAKEAWAYS
While “Wild” and “Bonkers” valuations dominate the buzz, the real trends show median figures climbing steadily and unicorn creation still robust (67 minted so far this year). However, founders should beware that success in one funding round doesn’t guarantee future smooth sailing. Healthy comparisons and long-term strategy remain essential.
Unicorn Founders vs. US Population: Big Gap across Gender and Race
A recent analysis by Ilya Strebulaev highlights the striking demographic disparity in unicorn leadership. Despite America’s growing diversity, the paths to billion-dollar valuations remain dominated by white male founders, with significant underrepresentation across gender and racial lines.
White Men Lead Disproportionately: White men account for 75% of unicorn founders, a stark contrast to their 29% share of the US population.
Women and Minorities Underrepresented: Women make up only 6.6% of unicorn founders, while Black and Hispanic founders represent just 0.5% and 2.1%, respectively. Meanwhile, Asian founders, at 17.5%, slightly exceed their 6.4% population share.
Startling Gender Gap: For every woman founder achieving unicorn status, there are approximately 14 male counterparts, underlining the persistent gender imbalance in high-growth entrepreneurship.
✈️ KEY TAKEAWAYS
The data reveals how structural inequalities continue to shape the venture capital ecosystem. Achieving equitable representation among unicorn founders will require addressing systemic barriers in funding, support networks, and access to opportunities for women and minority entrepreneurs.