While stocks looked Before a comeback on Friday after another scorching week of sell-offs, the fact is that software valuations are testing new levels of price depression.
There’s widespread damage from all those red charts plunging down and to the right: the decline in the value of public software companies has been an important leading indicator of the current slowdown in venture capital activity, for example, and the ability of startups to build their own to increase valuations.
However, daily coverage may provide snapshots rather than more complete images. So this beautiful Saturday I want to slow down and take stock of the software (SaaS, effective) valuations.
The smaller reality of SaaS valuations
There is no need at this point to gloat about how many investors got things wrong last year. Markets have a way of learning their own lessons; we don’t need to add anything to the college notes provided by the public market’s immisioning of recent tech IPOs or the panic overpriced unicorns feel when they compare their earnings base to their sticker price.