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Many startups are overvalued. But because they are also well-stocked with cash, they haven’t had to raise new funding at a lower or flat valuation — yet. However, new data from Carta found that cracks are starting to show.

Startup equity infrastructure platform Carta found that a record number of startup employee stock grants — which are stock option packages offered to individual employees — were repriced in Q3. The total of 18,629 repricings was up 260% from the 7,165 that were repriced in Q2. The only prior quarter that comes close is Q2 2020, with 12,570, when the pandemic started to unfold.

What these repriced share packages tell us is that startups are starting to mark down their internal valuations despite not raising a new round. How? Because employee stock grants are tied to a company’s 409a valuation — a third-party appraisal of a company’s fair market value.