Tech IPOs have hit a 20-year low thanks to high valuations across the industry, which could put Dropbox’s (and possible other tech firms’) initial public offering in jeopardy. The problem tech companies are facing is that Wall Street is beginning to come back down to Earth and is, in many cases, no longer willing to fork over cash at sky-high valuations.

Dropbox May Not Be Able To IPO As Unicorn Craze Deflates

Dropbox may struggle to price an IPO

In early 2014, Dropbox managed to get its valuation up to $10 billion from the $4 billion it had been at before that. However, investment banks are now warning that the cloud storage firm might not be able to get a $10 billion valuation for its IPO. Further, the company might not be able to deliver the pop early investors and employees typically look for in an offering, report Rolfe Winkler, Douglas Macmillan, Telis Demos and Monica Langley of The Wall Street Journal.

Regulatory filings indicate that BlackRock has slashed its estimate for what Dropbox is worth, which is especially important because the firm led the $350 million round of fundraising that brought the company’s valuation to $10 billion nearly two years ago. According to the filings, BlackRock’s new valuation gives a 24% haircut to Dropbox’s per-share value.

Dropbox: We don’t need capital

According to The WSJ, Dropbox management said they have continued to expand the business, adding 500 people just over the last year. Among the hires have been more senior-level executives. The company insists that it doesn’t need any more capital, either from public or private investors.

Nonetheless, Dropbox’s failure to achieve the valuation it had in early 2014 may be an omen for other tech startups considering an IPO. This year, the IPO market has chilled dramatically, mostly because tech companies are seeking valuations that are higher than the amount public investors will pay.

Tech IPOs stalled

So far year to date, just 14% of the offerings in the U.S. were in the tech industry. Data from Dealogic indicates that this is the smallest percentage of tech IPOs in two decades at least. Further, many of the U.S. companies that have gone public this year are struggling for returns, with the median return at zero in comparison to their offering prices.

Unlike in previous years, investors who purchased shares in newly public U.S.-based companies immediately after their offerings started trading are finding themselves down by an average of 13%. According to The WSJ, 11 or more of the 49 tech companies in the U.S. that were backed by venture capitalists and that have gone public since the beginning of last year were trading lower than the per-share valuation of their last funding raise as a private company. Those numbers were as of Friday.

Is Dropbox a bad omen?

These statistics suggest that investors might see even some of Silicon Valley’s tech firms with the most potential as being worth much less than they were even a year or more. And as this risk spreads throughout tech companies that are considering going public, it also could impact startups that are currently and plan to remain, at least for the time being, private. This could trigger a domino effect that would make it more difficult for them to hire qualified employees and maybe even threaten funding for startups in general going forward.

The Wall Street Journal spoke with Benchmark partner and venture capitalist Bill Gurley, who noted a sudden change during the third quarter. He said founders of companies running financing rounds are repeatedly lowering the valuation of their companies.

Citing unnamed sources, the newspaper adds that Jet.com, an online marketplace, has slashed the valuation it is seeking from $3 billion over the summer down to $2 billion within the last two weeks. Jet.com is said to be seeking $500 million in its funding round.

Dropbox impacted by Box

One problem that’s specific to Dropbox is that investors may be comparing it to its competitor Box, which held its IPO in December 2014. Box’s market value is $1.65 billion, which gives it a multiple of less than six times its projected revenue for 2016.

In order to get a similar valuation on the stock market, Dropbox would need revenue of approximately $2 billion, but according to The WSJ, one investment banker doesn’t expect the cloud storage company to exceed $500 million in revenue by much this year.

This post has been corrected. It previously stated that Dropbox had hired ex-Googler Neal Mohan, but that was just a rumor that never came to pass.