After the election, the public markets have roared, but not equally.

The broad software ecosystem has seen a relatively muted change in forward multiples. There’s no statistically significant change in the days after the election compared to the month before.

On the other hand, crypto’s top tokens have seen tremendous appreciation. Bitcoin is up 48% ; Solana up 70% ; & SUI up 324% in the few days since the announcenment. All of those ar statistically significant changes.

The rapid appreciation in crypto has been catalyzed by the anticipated clarity in crypto regulation & the potential for the Federal Reserve Bank to become a significant buyer of Bitcoin.

The sudden rise in prominence of stablecoins & the relaxation of certain regulations could provide a boost to the US Dollar as a reserve currency paralleling the Eurodollar phenomenon of the late-1950s & beyond (a good subject for a future post).

When will forward mulitples in overall software rise again? An open IPO market should introduce more names with growth rates greater than 30%. Today, there are no publics growing more than that.

A more permissive M&A environment should increase demand for software businesses; more demand should increase valuations as well.

Last, the growth rates of AI-first companies has increased private valuations meaningfully, a trend that should spill over to the public market soon.

The valuation environment shows early signs of changing, but the impact of the election isn’t broadly distributed.