"Pre-ChatGPT" startups face harsh scrutiny, with half of unicorns having raised no funding in three years and more than 220 companies having "fallen from grace"

According to PitchBook, more than 220 startups that last raised funding before ChatGPT fell below the $1 billion unicorn mark by 2026.

Average valuations for companies that raised in 2021–2022 have dropped sharply, with SaaS firms hit especially hard.

Investors are shifting capital toward fast-growing AI-native startups, squeezing older startups founded before the generative AI boom.

The trend is reshaping VC allocation and forcing legacy startups to rethink survival and growth strategies.