A-Round Valuations Down 25-50% While B- And C-Rounds Non-Existent

So says venture capitalist Bob Ackerman, co-founder of Allegis Capital according to this article in PEHUB.  Ackerman points out that in 2001-2002 valuations fell this amount over 15 months but have collapsed to this level in as few as 6 weeks!

I think he's talking about "new" rounds.  Obviously many startups with their A- and B-rounds behind them will see some inside follow-on funding.  From what I've seen, those valuations will be put off for another day as insiders fund with bridge loans.  Why a bridge loan?  Essentially it's just kicking the ball down field in terms of valuation, but more importantly (for investors) it keeps the new cash well in front of all other equity capital in the event of a liquidation (and in a down round, it has a better chance of converting at the lower valuation than doing an equity round now).

If you're an entrepreneur, you should fight like hell to avoid bridge loans, venture debt, convertible debt or any other form of leverage.  Instead seek to raise equity capital.  This is no time to be levering up...instead, you should be de-levering!  If you have outstanding venture debt or bridge loans, prioritize figuring out how to raise equity capital to replace it.  As almost every other market has shown, debt is toxic right now and should be avoided at all cost.