Dear SaaStr: Why Did Loom Have a $1.53 billion Valuation in May 2021 and But Is Now Being Acquired by Atlassian for $975 Million?
There will be a lot of these deals. Great outcomes, but at lower than the peak 2021 prices. Why? Valuations were much, much higher in 2021 than they are today. So much higher. So high, in fact, that many acquirers will basically ignore those 2021 valuations, more or less.
Public market valuations in fact have fallen by 66% since May 2021:
Put differently, Loom probably raised that round at 100x ARR. Today, they’re being acquired for perhaps 20x ARR.
Multiples were just crazy high in 2021. That warped so many things, including unicorn rounds and startup valuations.
