The 2022 SaaS Crash: Key Statistics
Table of Contents
- What Is a Down Round (And Why CEOs Fear It)
- The 2022 SaaS Stock Crash: Full Data
- The 10 Worst-Performing SaaS Stocks
- Why Private Companies Don't Face This Pain
- The 2023-2025 Recovery: Who Bounced Back
- Still Underwater: 36 Companies Below 2022 Highs
- Lessons for Startup Founders and Investors
- FAQ: Down Rounds and Market Corrections
In the private markets, a down round is treated like corporate chemotherapy—a last resort that signals something has gone terribly wrong. Founders restructure deals, take bridge financing, accept punishing terms, or shut down entirely rather than accept a lower valuation.
But in the public markets? From January 2022 to January 2023, 61 out of 63 companies in the Bessemer Cloud Index experienced exactly that—a brutal repricing that would have triggered anti-dilution clauses, underwater employee options, and emergency board meetings if they were still private.
The median decline was 40%. The average was 39%. And some of the most celebrated cloud companies—Asana, RingCentral, Twilio, SentinelOne—lost 70-80% of their value in a single year.
This analysis examines the complete Bessemer Cloud Index dataset to understand what happened, which companies suffered most, who recovered, and what it means for private company valuations today.
What Is a Down Round (And Why CEOs Fear It)
A down round occurs when a startup raises venture capital at a lower valuation than its previous funding round. For example, if a company raised a Series B at a $500M valuation and then raises a Series C at $300M, that's a down round—a 40% haircut that ripples through the entire cap table.
Why Down Rounds Are So Painful
Anti-Dilution Provisions Trigger
Previous investors often have weighted-average or full-ratchet anti-dilution protection. This means founders and employees get diluted even more than the headline valuation suggests.
Employee Options Go Underwater
Stock options with strike prices above the new valuation become worthless. Key employees leave, and recruiting becomes nearly impossible without refresher grants.
Signal of Weakness
Down rounds signal to customers, partners, and future investors that the company failed to meet expectations. It becomes a self-fulfilling prophecy as deals get harder to close.
Governance Changes
Down rounds often come with new board seats for investors, founder vesting resets, or changes in protective provisions. Founders lose control.
This is why private company CEOs go to extreme lengths to avoid down rounds. They'll take convertible notes, accept unfavorable liquidation preferences, do inside rounds at flat valuations, or even wind down the company rather than officially mark down.
Public companies don't have this luxury. Every day, the market reprices their equity in real-time. And in 2022, that repricing was catastrophic.
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Start Free TrialThe 2022 SaaS Stock Crash: Complete Bessemer Cloud Index Data
The Bessemer Cloud Index tracks 63 of the most important public cloud and SaaS companies. It's the benchmark for cloud software performance, including companies like Salesforce, Snowflake, Datadog, CrowdStrike, and Shopify.
From January 2022 to January 2023, the index experienced its worst year on record:
Decline Statistics
- Companies down: 61 of 63 (97%)
- Companies up: 2 of 63 (3%)
- Average decline: -39.06%
- Median decline: -40.00%
Only 2 Winners
- Agilysys (AGYS): +88.89%
- Intapp (INTA): +16.37%
These were the only two companies in the entire index to post gains. Both are smaller, profitable companies that avoided the growth-at-all-costs premium destruction.
Complete Performance Data: All 63 Companies
| Ticker | Company | 2022 Change | 2023-25 Recovery | Total (2022-25) |
|---|---|---|---|---|
| ASAN | Asana | -79.41% | +46.15% | -69.91% |
| RNG | RingCentral | -79.39% | -7.09% | -80.85% |
| TWLO | Twilio | -76.95% | +147.11% | -43.03% |
| FSLY | Fastly | -70.26% | +2.30% | -69.58% |
| S | SentinelOne | -70.13% | +57.36% | -52.99% |
| CFLT | Confluent | -68.89% | +34.65% | -58.10% |
| OKTA | Okta | -67.15% | +29.07% | -57.60% |
| WEAV | Weave | -64.66% | +204.88% | +7.73% |
| PATH | UiPath | -64.33% | -2.48% | -65.22% |
| SHOP | Shopify | -64.00% | +143.17% | -12.46% |
| DOCN | DigitalOcean | -63.17% | +42.84% | -47.39% |
| DOCU | DocuSign | -61.07% | +61.73% | -37.03% |
| ZS | Zscaler | -60.15% | +61.43% | -35.67% |
| NET | Cloudflare | -59.30% | +164.90% | +7.80% |
| QTWO | Q2 Holdings | -59.23% | +211.91% | +27.16% |
| PLTR | Palantir | -58.49% | +989.77% | +352.34% |
| MNDY | Monday.com | -57.59% | +100.32% | -15.04% |
| BRZE | Braze | -57.55% | +43.67% | -39.02% |
| MDB | MongoDB | -56.71% | +27.54% | -44.79% |
| TEAM | Atlassian | -56.64% | +96.52% | -14.78% |
| DDOG | Datadog | -56.38% | +95.12% | -14.90% |
| SNOW | Snowflake | -53.10% | +16.81% | -45.22% |
| SEMR | Semrush | -52.62% | +80.22% | -14.61% |
| BILL | Bill.com | -51.95% | -17.30% | -60.26% |
| ESTC | Elastic | -51.95% | +96.90% | -5.39% |
| IOT | Samsara | -51.48% | +274.93% | +81.92% |
| NCNO | nCino | -47.75% | +20.26% | -37.16% |
| CRWD | CrowdStrike | -46.97% | +277.30% | +100.08% |
| WIX | Wix | -45.22% | +176.07% | +51.24% |
| HUBS | HubSpot | -45.01% | +123.93% | +23.14% |
| FIVN | Five9 | -44.43% | -46.42% | -70.22% |
| GTLB | GitLab | -40.00% | +40.23% | -15.87% |
| FRSH | Freshworks | -36.89% | +16.84% | -26.26% |
| CXM | Sprinklr | -36.44% | -6.78% | -40.75% |
| DT | Dynatrace | -35.20% | +48.89% | -3.51% |
| TOST | Toast | -35.08% | +84.14% | +19.55% |
| ADBE | Adobe | -35.06% | +20.54% | -21.72% |
| CRM | Salesforce | -34.59% | +118.49% | +42.91% |
| AI | C3.ai | -34.05% | +80.79% | +19.22% |
| WDAY | Workday | -33.39% | +51.23% | +0.73% |
| CLBT | Cellebrite | -33.37% | +345.21% | +196.63% |
| VEEV | Veeva | -32.96% | +38.72% | -7.00% |
| AVPT | AvePoint | -31.64% | +319.21% | +186.57% |
| BL | BlackLine | -30.26% | -9.22% | -36.69% |
| WK | Workiva | -28.99% | +23.29% | -12.45% |
| PCOR | Procore | -28.12% | +43.00% | +2.80% |
| SPT | Sprout Social | -27.04% | -47.10% | -61.40% |
| NOW | ServiceNow | -26.66% | +150.78% | +83.93% |
| TENB | Tenable | -25.49% | +9.94% | -18.08% |
| PAYC | Paycom | -21.80% | -33.02% | -47.62% |
| ALKT | Alkami | -19.63% | +124.25% | +80.23% |
| QLYS | Qualys | -16.00% | +30.33% | +9.47% |
| PD | PagerDuty | -15.93% | -33.62% | -44.20% |
| FROG | JFrog | -14.29% | +34.36% | +15.15% |
| PANW | Palo Alto | -13.69% | +145.30% | +111.71% |
| CWAN | Clearwater | -12.28% | +47.92% | +29.75% |
| PCTY | Paylocity | -11.76% | +1.28% | -10.63% |
| NTNX | Nutanix | -9.18% | +139.74% | +117.73% |
| APPF | AppFolio | -3.22% | +119.24% | +112.19% |
| SPSC | SPS Commerce | -0.70% | +39.73% | +38.76% |
| ZETA | Zeta Global | -0.21% | +107.80% | +107.36% |
| INTA | Intapp | +16.37% | +146.20% | +186.50% |
| AGYS | Agilysys | +88.89% | +57.66% | +197.80% |
| AVERAGE | -39.06% | +92.21% | +13.86% | |
| MEDIAN | -40.00% | +51.23% | -12.45% | |
The 10 Worst-Performing SaaS Stocks in 2022
These companies lost more than 60% of their market value in a single year. For comparison, a private company experiencing this kind of decline would face near-total cap table destruction.
What Went Wrong?
The 2022 crash wasn't caused by company-specific failures. It was a systematic repricing of growth stocks as interest rates rose:
- Rising rates: The Fed raised rates from 0% to 4.5% in 2022, crushing the present value of future cash flows
- Multiple compression: Revenue multiples collapsed from 20-50x to 5-15x across the sector
- Growth deceleration: Post-COVID growth rates normalized, removing pandemic-era premiums
- Profitability focus: Markets shifted from “growth at all costs” to “path to profitability”
Why Private Companies Don't Face This Pain
If a private company lost 40% of its value, it would be a crisis. Board meetings would be called. Layoffs announced. Founders would spend months negotiating with existing investors to avoid triggering anti-dilution provisions.
But for public companies, this just... happened. Every day. For 12 months. And there was nothing management could do about it.
Private vs Public: Key Differences
| Factor | Private Companies | Public Companies |
|---|---|---|
| Valuation Frequency | Only during funding rounds (every 12-24 months) | Every second the market is open |
| Anti-Dilution | Triggers on new financing at lower price | N/A—no preferred stock structure |
| Employee Equity | Paper value until exit; 409A sets strike price | Real-time market value; employees can sell |
| Visibility | Only insiders know real valuation | Everyone sees the decline in real-time |
| Narrative Control | Can avoid marking down until next raise | Zero control over market perception |
The irony is that many private companies with 2021 valuations are still marked at those levels on their cap tables. They've simply avoided raising new rounds. Their public comparables crashed 40-80%, but the private companies maintain the fiction of their peak valuation.
This is why secondary market data and startup databases have become critical—they help price private companies based on public market movements, not stale funding rounds.
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The 2023-2025 Recovery: Who Bounced Back
The good news? Most companies recovered. From January 2023 to January 2025, the Bessemer Cloud Index staged a remarkable comeback:
Recovery Statistics
- Companies up: 54 of 63 (86%)
- Companies down: 9 of 63 (14%)
- Average gain: +92.21%
- Median gain: +51.23%
Best Performer
From $7.82 in Jan 2023 to $85.22 in Jan 2025, driven by AI narrative and government contracts.
Top 10 Recoveries (2023-2025)
Still Underwater: 36 Companies Below 2022 Highs
Despite the recovery, 57% of companies (36 out of 63) remain below their January 2022 highs as of January 2025. The median company is still down 12.45% from peak levels.
For investors who bought at the top, the losses are permanent. For employees with options granted at 2021-2022 valuations, many remain underwater.
Biggest Losers: 2022-2025 (Still Down)
| Company | 2022 Crash | 2023-25 | Total Loss |
|---|---|---|---|
| RingCentral (RNG) | -79.4% | -7.1% | -80.8% |
| Five9 (FIVN) | -44.4% | -46.4% | -70.2% |
| Asana (ASAN) | -79.4% | +46.1% | -69.9% |
| Fastly (FSLY) | -70.3% | +2.3% | -69.6% |
| UiPath (PATH) | -64.3% | -2.5% | -65.2% |
| Sprout Social (SPT) | -27.0% | -47.1% | -61.4% |
| Bill.com (BILL) | -52.0% | -17.3% | -60.3% |
| Confluent (CFLT) | -68.9% | +34.6% | -58.1% |
| Okta (OKTA) | -67.2% | +29.1% | -57.6% |
| SentinelOne (S) | -70.1% | +57.4% | -53.0% |
RingCentral remains down 81% from its January 2022 high. Five9, Asana, Fastly, UiPath, and Bill.com are all down 60%+ over the three-year period. These are not small companies—they're category leaders that simply got repriced to fundamentals.
Lessons for Startup Founders and Investors
1. Valuations Are Not Permanent
Private companies that raised at 50x revenue in 2021 may feel insulated, but their public comparables now trade at 5-10x. The longer they avoid raising, the more severe the eventual repricing. Better to take a measured down round than pretend 2021 valuations still exist.
2. Profitability Matters Again
The companies that recovered fastest (Palantir, CrowdStrike, ServiceNow) either achieved profitability or had clear paths to it. “Growth at all costs” is no longer rewarded. Founders should focus on unit economics, not just top-line growth.
3. Employee Equity Needs Attention
If public company employees lost 40-80% of their equity value, imagine private company employees with options struck at peak 2021 valuations. Boards need to address underwater options through repricings or refresher grants to retain talent.
4. Down Rounds Are Normal
When 97% of the most successful cloud companies can lose 40% of their value in a year, down rounds shouldn't carry the stigma they do. Markets reprice constantly. Private companies just hide it better.
5. Recovery Is Possible
Even after devastating losses, 86% of companies recovered within two years. Some (Palantir, CrowdStrike, Samsara) came back stronger than ever. A down round isn't the end—it's a reset that can lead to stronger fundamentals.
FAQ: Down Rounds and Market Corrections
What is a down round in startup funding?
A down round occurs when a startup raises capital at a lower valuation than its previous funding round. This dilutes existing shareholders more than expected and signals that the company has not met growth expectations or that market conditions have deteriorated.
How many SaaS companies crashed in 2022?
According to Bessemer Cloud Index data, 97% of public SaaS companies (61 out of 63) experienced significant stock price declines from January 2022 to January 2023. The median drawdown was approximately 40%, equivalent to a severe down round for private companies.
Which SaaS stocks fell the most in 2022?
The worst-performing SaaS stocks in 2022 included Asana (-79%), RingCentral (-79%), Twilio (-77%), SentinelOne (-70%), Fastly (-70%), Confluent (-69%), and Okta (-67%). Many high-growth cloud companies lost 50-80% of their market value.
Did SaaS stocks recover after 2022?
Yes, from January 2023 to January 2025, 86% of Bessemer Cloud Index companies recovered, with a median gain of 51%. However, 57% of companies remained below their January 2022 highs, showing the lasting impact of the 2022 crash.
Why do private companies avoid down rounds?
Private companies avoid down rounds because they trigger anti-dilution provisions, damage employee morale (stock options become worthless), signal weakness to customers and partners, make future fundraising harder, and can trigger founder vesting acceleration or board control changes.
What is the Bessemer Cloud Index?
The Bessemer Cloud Index is a market-cap weighted index of 63 leading public cloud software companies, maintained by Bessemer Venture Partners. It includes companies like Salesforce, Snowflake, Datadog, CrowdStrike, and Shopify, and serves as the benchmark for cloud software performance.
Conclusion: The Down Round That Wasn't Called One
Private company CEOs go to extreme lengths to avoid down rounds. They restructure, bridge, extend runways, and sometimes shut down rather than accept a lower valuation.
But from January 2022 to January 2023, almost every successful public cloud company experienced exactly that—a brutal repricing that averaged 40% and exceeded 70% for the hardest-hit names. The only difference? Public markets can't negotiate terms or delay the markdown.
The 2022 SaaS crash is a reminder that valuations are market-dependent, not company-dependent. When the cost of capital rises, all growth assets get repriced—whether they're public or private.
For founders still sitting on 2021 valuations, the clock is ticking. The public markets have already moved on. Eventually, the private markets will too.
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