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Gusto, an HR technology unicorn worth nearly $10 billion, has raised an extension to its 2021-era Series E funding round. That funding event included $175 million in primary capital, a tranche of secondary shares and a tender offer. EquityZen first noted the new capital raise from Gusto based on its review of publicly available filings, which TC can confirm.

Precisely how much capital Gusto raised to extend its Series E is slightly more opaque; however, it appears to be around the $55 million mark.

That Gusto is raising money as an extension of its Series E, implying that it added the capital at a flat valuation to its 2021 raise, should not be considered a negative sign. The market for startup investments has radically shifted since late 2021, with the public value of technology companies trending negatively for nearly two quarters now; companies that raised last year are now confronting a new reality regarding investor expectations.

With its extension, Gusto now likely has sufficient cash to see it through the present trough and perhaps to go public once the IPO window opens. How long of a wait that will prove is not clear, making the act of taking on additional funding reasonable.

The extension, along with a secondary offering Gusto conducted (also of unclear size), was executed to satisfy high investor demand for the Series E, a source with knowledge of the matter told TC.

The company is not alone in upsizing its latest fundraise. As TC reported recently, Faire also added more capital to its coffers as an extension round.

“In the current market environment, a ‘flat’ extension round to a 2021 raise should be considered a win,” Phil Haslett, co-founder and chief strategy officer at EquityZen, told TC. Haslett noted that raising a “flat” extension can help companies avoid a down round or valuation drop and that he expects to see more of these types of raises from “even the strongest companies.”

How many such rounds we will see is not clear, and it is also unclear how many we will be able to detect. Extensions are a bit quieter in filing terms and from a PR perspective; companies that trumpeted huge rounds last year that they extend in the present downturn may not want to broadcast that they are selling more shares at a dated price. If that’s indeed true, they will be making an error.

Why? One issue that later-stage private companies have compared to their public counterparts is the cost of opacity. More simply, public companies can be vetted by potential customers as solvent. Private companies are harder to see inside of. If a unicorn shares that it raised another chunk of funds at a flat price this year, it would combat market concerns about continuing viability in today’s turbulent market.

This fits neatly in TC’s more general perspective that sharing more information, as opposed to less, would be good not merely for our ability to cover the startup market, but for the companies themselves.

Flat is the new up. Again.