The chart of how much money is still left waiting to be invested in crazy. Looks roughly that 2021 and 2022 have as much money waiting to be invested as 2012 did total. Each year has added that much.
So valuations need to come down dramatically is the argument, but the amount of capital trying to get spent is going up astronomically. How does that mismatch resolve in an actual marketplace? Do we assume there are suddenly 4x as many good investments to make from 10 years?
Even valuations of 2-4 years ago included inflation: It’s worth putting 10x the yearly revenue if it’s probable that every company will increase prices by 50% in 3 years.
So valuations need to come down dramatically is the argument, but the amount of capital trying to get spent is going up astronomically. How does that mismatch resolve in an actual marketplace? Do we assume there are suddenly 4x as many good investments to make from 10 years?