Venture-backed deals are facing significant downturns, with 15.9% categorized as down rounds in 2025, the highest rate in a decade. Many recent IPOs have debuted below their peak valuations, with notable drops observed in companies like MNTN and Circle. Despite challenges in valuations, AI remains a strong sector, yet also experienced 29.3% of down rounds. The U.S. IPO market is recovering, generating $67 billion in exit value in Q2 2025, but only 1% of U.S. unicorns have gone public this year, limiting returns for venture capital firms.
Data from PitchBook reveals that 15.9% of venture-backed deals in 2025 are down rounds, marking the highest rate in a decade.
Major IPO listings in Q2 2025 hit public markets below peak valuations, including MNTN dropping from $2 billion to $1.1 billion.
In the AI and machine learning vertical, 29.3% of down rounds occurred, yet median Series B step-up for AI startups remains significantly higher.
Despite high valuations, only 1% of U.S. unicorns have made public debuts this year, indicating limited distributions back to VC firms.
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