Wilson Sonsini is pleased to present the Q2 2025 edition of The Entrepreneurs Report. We’ve compiled a range of data on venture, convertible note, and SAFE financing transactions in which the firm was involved during the second quarter, with the objective of identifying relevant trends in activity and valuation levels for the U.S. venture capital industry in general.

Key features of this edition:

• Quantum Computing | A New Frontier for Start-Ups: In our comprehensive interview with Wilson Sonsini partner Dr. Ali Alemozafar, he emphasizes that quantum computing is transitioning from theory to practice, presenting groundbreaking opportunities for innovation in drug discovery and AI workflows for start-ups in the life sciences and technology sectors.
• Late-Stage Valuations Have Best Quarter Since 2021: Valuations rose across most stages this quarter, with Series C and later reaching their highest levels since 2021, indicating stronger investor confidence.
• More Companies Justify Up Rounds: Although down and flat rounds are still slightly above historical averages, the number of up rounds has increased for the third consecutive quarter.
• Tax Incentives for Start-Ups: The newly signed “One Big Beautiful Bill” shortens holding periods and expands tax exemptions for Qualified Small Business Stock (QSBS), potentially allowing investors to exclude up to 100 percent of federal capital gains tax on certain start-up investments earlier in the company life cycle.
• Regulatory Changes Ahead: New regulations from the California Privacy Protection Agency (CPPA) impose compliance obligations on businesses handling personal data, particularly affecting AI and automated decision-making technologies.

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