I think you are missing the point. I think the software business has become undesirable for VC investment. I am seeing that in the market from the otherside. People think there is no moat. Which I absolutely disagree but yea.

VC invest is same as buying a house. Someone has valued your house is worth x, thats why it is valued at x. There were people willing to invest at 1B valuation now they are not. Market has moved. Imagine, if the area where you bought the house, suddenly is not desirable or theres no one willing to pay for it, then value of your house will go down, in some scenarios to zero. It is as simple as that.