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The company’s stock opened at $14.50 on Thursday, its first day of trading, and closed at $13.50. Its stock opened at $13.97 Friday morning before dropping to $11.31 by the close of markets.

It hasn’t been the smoothest transition from private to public for the mattress startup. Casper initially set a price range of between $17 and $19, dropping the company’s valuation to about $786 million–quite a bit below the $1.1 billion valuation Casper last had as a private company after it raised its $100 million Series D in March 2019.

Earlier this week, Casper lowered the price range to between $12 and $13, further sinking the valuation. It eventually priced its shares at $12 apiece, at the bottom of the range, and was then valued at $475.5 million ($490.6 million if underwriters exercise their options).

The company’s stock did pop on its first day of trading, but didn’t perform as well on Friday, when stocks across the , , and were down.

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Public cloud and SaaS companies, which have enjoyed a massive run-up in value in recent years, have fallen more sharply than tech stocks more generally. These recent price changes could slow the IPO pipeline, and possibly reprice private rounds into related private companies.

Down

Today is not the first time we’ve covered a negative gyration in the value of tech stocks. Indeed, you can read a few previous examples here from 2018 and here from 2017.

However, what’s notable in today’s down market is the sharpness of the retreat and the lack of positive news on the horizon. As analysts , it appears that things could get worse before they get better. Thinking narrowly to certain tech shares, the situation could limit short-term upside to stocks valued more on growth than profit fundamentals.

The market pain is not evenly distributed. At the time of writing, the Dow Jones Industrial Average and the S&P 500 are each down about 2 percent. The Nasdaq is off around 2.7 percent. And the Bessemer-Nasdaq cloud index of SaaS stocks is off 3.9 percent.

The damage is similarly varied as we zoom out. When we compare the Nasdaq and the Bessemer cloud index to their recent highs (also their 52-week highs, and all-time highs, for those keeping score), the Nasdaq is off 6.6 percent. That’s a steep decline in just a few trading sessions. However, cloud stocks in the Bessemer-demarcated basket are off a sharper 10.3 percent.

In stock market terms, a 10 percent price change is called . SaaS and cloud stocks are, therefore, in correction as of today compared to their recent highs.

From Highs, Lower Highs

It’s perhaps not panic time yet for cloud and SaaS companies who are public, and therefore not yet time for alarms among their private-market comps.

Why? Because SaaS and cloud stocks are trading at record highs, and at record valuation multiples. Indeed, as of the time of writing, still notes on its website that the stocks that make up its index are trading for historically high revenue multiples:

That’s still more than healthy. Indeed, when it was 10x, that was quite robust. Even, I’d argue a 9x enterprise value (EV) revenue multiple would be strong. Shifting a lot of stocks from an 11x average to a 9x average would involve pain, but the market would still be healthy for SaaS and cloud companies.

So what we’re seeing today is a correction, yes, but from very, very good to merely very good. If the declines continue, however, the situation could go from worrisome to bad quite quickly. And for private companies looking to defend their valuation and raise more money, neither situation is good. You don’t want market doubt when your valuation is illiquid.

Illustration: .

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Last week I tried to highlight a sentiment shift in the technology world. Bullishness felt ascendant once again.

Sure, venture activity was down compared to some 2018 highs in the first quarter, but the Nasdaq was popping, big rounds were landing, and the IPO market looked hot.

Things have continued in that vein. Yesterday, for example, both the Nasdaq and the S&P 500 “finished in record territory, notching all-time highs for the first time since fall and late summer,” . Given that the public markets help shape opinion in the private markets (optimism and pessimism bleed from the stock market into how private investors value companies), it’s an important moment for the firms that we cover here.

An IPO

The market warmth we just described is driving companies through the IPO gauntlet.

Yesterday we dug into the DouYu IPO filing (Remember the Huya debut?ÌýDouYu marks another esports-focused offering.), only to discover that we’d missed a different China-based technology offering targeting the U.S. markets. Say hello to , an ecommerce company with a membership component.

According to its , this is how it works:

If that isn’t clear, the company’s model depends on using lots of IRL and digital tech to link suppliers and consumers. That’s how Amazon works, with its website, services, and distribution network powering an ecommerce stack.

Yunji tallied $1.892 billion in revenue last year (cost of 2018 revenue: $1.557 billion), leading to a slim operating loss of $14.5 million. The firm grew 92 percent from 2017 to 2018, for reference, while cutting its operating loss slightly. That’s a path to profitability.

And Yunji has done all that while not raising billions of dollars. Indeed, Crunchbase has in recorded capital for the company. Some rounds that we know about don’t have listed round values, but even given that its capital thirst seems lesser than what we’ve seen from some companies.

So we’ve discussed our record and our IPO. Let’s peek at an interesting round.

A Round

A company called announced . Eightfold is a company I know a bit. I met a few of its team in San Francisco last year.

That a company with an “.ai” suffix raised a $28 million Series C is not surprising. In fact, that’s nearly the platonic ideal of a 2019 venture capital round. What makes Eightfold interesting isn’t its funding amount (though it added to , which isn’t bad at all), but rather what it’s trying to accomplish.

Eightfold wants to help big companies with what it describes as their “number one challenge,” namely “hiring and retaining top talent.” If you ask CEOs of tech companies what’s bothering them, the talent crunch is a pretty common response, so Eightfold is tackling a reasonable problem.

The economy is hot (see above), and markets are rewarding tech companies looking to reach the next level (see above), exacerbating the talent crisis. But even if there was a correction of moderate size, talent would still be tough in and around tech hubs. That puts the startup in a somewhat fun spot; unless tech is decimated in a correction, I’d hazard that Eigthfold is slightly recession-proof.

That aside, Eightfold is working in a space where there is demand, and it, putatively at least, has a solution. The combination should help it grow quickly. Sadly, the firm .

Hot Times

Taking all that together, the public markets are setting new records, tech companies of all shapes and sizes and profitability are targeting the U.S. markets, and startups looking to solve hot-market talent problems are finding new backers and fresh capital.

It’s still hot times in tech. No matter how bad things looked in December.

Illustration: .

Earlier this week , a well-known venture crew, announced several updates to its Cloud Index. The new tool has useful features like real-time updates, but it has shed some of its usefulness along the way.

Index 1.0

The original index tracked a basket of public, cloud-centric software as a service (SaaS) companies. It provided quick updates on the market’s feelings towards a number of tech’s growing players.

At a glance, the index could tell you if investor sentiment was rising or falling for public cloud companies, many of which were still firmly in their growth era. Even more, the Index helped this publication keep tabs on startups that worked in SaaS or cloud areas.

If the index went up—stretching certain financial metrics that private and public investors track—we could infer that fundraising activity for analogous startups was likely to be warm. Also, higher valuations for public cloud and SaaS companies also trickle backwards into the private market. This impacted companies that later needed to go public, as sometimes their public valuation could leave reality, setting up later fundraising and pricing issues for the startup.

The index was a tool that helped Crunchbase News understand private companies, private companies on their way to going public, and public companies—all at the same time.

Index 2.0

The new Cloud Index, properly known as theÌý“,” tracks a slightly amended set of companies.

Per , here’s how it was changed:

“There are a number of companies in the BVP Nasdaq Emerging Cloud Index that were not part of the BVP Cloud Index due to the new index’s refined eligibility requirements. For example, Adobe is included in the initial index given that it has masterfully transitioned to a cloud company, and 2018 cloud IPOs DocuSign, Dropbox, Zuora, and Zscaler have been included as well. Additionally, given the partnership with Nasdaq, we believe the new benchmark will be even more reflective of the sector’s performance as the index will be calculated on an equal-weighted basis and employ Nasdaq’s index maintenance and rebalancing standards.”

Don’t worry about the phrase “equal-weighted.” It just means that each company’s stock in the index has the same impact on the basket as any other. As a result, larger, more valuable companies don’t carry more heft.

Now here is the good and the bad.

• The good: The new Cloud Index updates in real-time. This is useful for you and I as it means that we don’t have to wait for bi-monthly updates to the Bessemer-provided chart.
• The bad:ÌýBessemer previously provided a set of useful metrics for the collected companies, such as cash flow and next year’s revenue divided by current enterprise value. Those figures were laid out with median, and mean numbers, and more. Now those features are gone. Now Bessemer nor the Nasdaq list the figures.

So now we have a far better cloud and SaaS public market pulse; however, the financial summations we will have to do ourselves. Nothing in life that is worth having is free. Or perhaps that’s not true, but it applies in this case.

°Â±ð’±¹±ðÌýcited the originalÌýindex just a few times over the past few quartersÌýand expect to keep it up. Happy charting, everyone!

Illustration:Ìýs