#62 VC Market Data for Fund Model Updates
Every Tuesday/Thursday, we bring you actionable tools, real-world experiences, and insider insights for #VC CFOs/Finance Pros and fund managers, #LP investors, and general industry enthusiasts/people who want to learn :).
“Imperfect action is better than perfect inaction.” -Harry S. Truman
Model Updates: Use the Latest Market Data
Now that Q1 is in the rearview and audit/taxes are done (we hope), it’s time to revisit those 2023 full-year plans, budget forecasts vs. actuals, and fund models!
It’s important to incorporate the latest data in your fund models, for both existing portfolio companies and future investments. If you’re earlier in your fund modeling journey, you can reference our prior posts (#31 VC Fund Model & Budget).
The good news is that industry data sources are publishing insights quickly following the conclusion of each quarter. As a VC investor and/or finance pro, it’s now your job to take that data and adjust your models accordingly.
Looking at the most recent data, here are three key items for your fund model updates (we focused on seed stage but data on all stages is available in the linked reports):
Round sizes: median seed deal size of $3m
Valuations: median of seed valuation $13m pre-money ($16m post-money)
Pacing: still slow, only ~3k deals across US VC
Next level thoughts/insights: what does all this mean for historical graduation rates (lower them), return of capital (more of it), and Series A+ fundraises (smaller dollars, higher threshold required by these investors)?
A Picture is Worth 1,000 Words - The Story by Charts
Here are some of our favorite data sources with links to the full report. For you, dear reader, we’ve pulled out some of the charts and takeaways that matter most!
VC activity dropped in all stages and sectors in the first quarter of 2023:
In Q1’23, there were ~3k deals totaling ~$37 billion.