With another tariff induced red-tinged day hammering markets, I wondered: Do private markets follow public ones? The data suggests yes—but with a delay & at a fraction of the magnitude.

A 1% increase in Nasdaq’s (QQQ) quarterly return translates to a 0.47% rise in median Series A valuations—but only after a two-quarter delay.

The inverse holds true as well: when public markets contract, private valuations follow suit approximately six months later at roughly half the intensity.

You can see this in the charts where the Nasdaq plummeted, but it would take some time for the private markets to react both for the median Series A, but even more for the top quartile (P75).

These relationships are statistically detectable but don’t explain most of the variance: the Nasdaq’s lagged returns explain only about 7.5% of the variation in Series A valuations

This means that while public market performance does influence private valuations, it’s just one factor among many.

Most early-stage valuation variance comes from factors entirely independent of public markets: total venture capital fundraising, cycle positioning, growth rates among top-decile companies, & most critically, interest rates.

In our earlier analysis, we discovered a hyperbolic relationship between the 10 year interest rates & Series A activity. As rates fall beyond certain thresholds, venture activity doesn’t increase linearly - it explodes.

And the correlation here is much stronger at -0.43.

For founders & investors, this suggests two practical insights: public market crashes will eventually ripple into the private markets, but with both a delay & diluted impact—and the unique attributes of individual companies & interest rates still matter far more.

The private market isn’t immune to public market gravity, but it orbits with its own momentum around interest rates.