There were assessments key for the entire venture capital industry this year as many VCs struggle to navigate their overvalued portfolios and founders struggle to save money and meet their lofty valuations.

So it was predictable that valuations would fall off a cliff this year. But it didn’t happen because venture capital investment is not that simple.

First, let’s look at the numbers: According to PitchBook, the average valuation for a startup deal in the United States was $10.5 million, up from $9 million last year. The average early-stage valuation through the third quarter of this year was $55 million, compared to $44 million last year. The average late-stage valuation was $91 million from $100 million in 2021.

It may seem silly for valuations to continue to rise for some stages – especially after investors were made to feel like they were crazy to get in at last year’s prices, and of course in some ways they are – but it makes a lot of sense too.

Kyle Stanford, senior venture capital analyst at PitchBook, told TechCrunch that we can’t forget about record levels of dry powder, for example.

“Over the past few years, there has been such a rise in multi-stage investors or Andreessen [Horowitz] and Sequoia, which are investing billions of dollars in early-stage investments,” Stanford said. “The amount of capital that is still available for early-stage is still very high, and many investors are still willing to put a lot of money into deals.”