While watching stocks to return on Friday after yet another hot selling week, it’s the fact that software estimates are testing new levels of price depression.
As a result of all these red charts plummeting down and to the right, significant damage is being done: for example, the decline in the value of public software companies has become a key leading indicator of the current slowdown in venture capital activity and the ability of startups to raise their own valuations higher.
However, daily lighting can provide snapshots instead of fuller images. So, on this beautiful Saturday, I want to slow down and take stock of software evaluation (SaaS, actually).
Lesser reality of SaaS estimates
For now, there is no need to gloat over how many investors got it wrong last year. The markets have a way of teaching their own lessons; we don’t need to add to the lecture notes the public impoverishment of recent tech IPOs or the panic that overpriced unicorns experience when they compare their revenue base to their list price.
Credit: techcrunch.com /