Sequoia Capital and Andreessen Horowitz, two of Silicon Valley’s most high-profile venture firms, are poised to take a massive hit on their last investment in grocery delivery company Instacart, a deal that closed in 2021 as tech stocks were soaring.

In its latest IPO prospectus update, filed Friday, Instacart said it plans to sell shares at $28 to $30 apiece, valuing the company at around $10 billion at the top of the range.

That’s more than 75% below where Sequoia and Andreessen invested in early 2021. At that time, Instacart sold shares at $125 a piece for a $39 billion valuation. The delivery economy was booming because of Covid shutdowns, and Instacart’s services were seeing record demand.

“This past year ushered in a new normal, changing the way people shop for groceries and goods,” Instacart finance chief Nick Giovanni said in a press release at the time.

In the more than two years since then, Instacart and its investors have learned that growth during that period was anything but normal. Instacart was closing out a quarter in which revenue surged 200%. In the quarter before, sales jumped almost sevenfold. Instacart said it was preparing to increase head count by 50% and bolster investment in advertising.

Sequoia’s Mike Moritz, who led his firm’s investment and recently announced his departure after 38 years, said in the same press release that Instacart was “fulfilling its role as a vital service for consumers, a reliable partner for retailers and an effective platform for advertisers.” Fidelity, T. Rowe Price and D1 Capital Partners also participated in that financing round.

Then the economy reopened, inflation spiked and the Federal Reserve started boosting interest rates, which hovered near zero throughout Covid. Consumers started shopping again in person on tightened budgets, and with capital costs jumping, investors began demanding that cash-burning companies find a path to profitability. Last year, the Nasdaq suffered its steepest drop since the 2008 financial crisis.

It’s also true that venture firms haven’t seen any real returns from IPOs since before the 2022 market collapse. The dearth of exits is particularly stark because VCs invested record amounts of capital in 2020 and 2021, including deals at high valuations in areas such as crypto and fintech.

Even with the changing market conditions, Instacart has continued to grow but at a dramatically slower pace. Revenue increased 15% in the latest quarter from the year prior, and operating expenses have come down over that time, allowing the company to turn profitable.

From a valuation perspective, the bigger issue is that Instacart raised the $39 billion round during a record stretch of tech IPOs, and just a couple of months after fellow sharing-economy companies Airbnb and DoorDash had blockbuster offerings.

There hasn’t been a notable venture-backed tech IPO in the U.S. since late 2021, and Instacart and Klaviyo are the only two that have publicly filed recently. Car-sharing service Turo is also on file, but its initial prospectus came out in early 2022.

Fortunately for Sequoia and Andreessen, they began investing in Instacart when the company was in its early days and the stock price was much lower than it is today. Assuming the stock price holds up, there’s still considerable money to be made for limited partners. Because of the lock-up period, the firms can’t begin selling shares until 180 days after the offering.

Sequoia is the largest investor in Instacart, with a 15% stake on a fully diluted basis. The 400,000 shares it purchased in 2021 are a small sliver of the 51.2 million shares it owns. In total, the firm has invested about $300 million for a stake that would be worth over $1.5 billion at the top of the range.

Sequoia led Instacart’s $8.5 million Series A round in 2013, when the price was just 24 cents a share, according to the prospectus. Andreessen led the next round at $2.98, and Sequoia participated. Both firms were in the Series C at $13.31 a share and the Series D at $18.52.

Because Andreessen’s total ownership is below 5%, its full stake isn’t disclosed in the prospectus.

Representatives from Sequoia and Andreessen declined to comment.

Not until 2020 did Instacart’s share price climb to around where it is today, in a $200 million round led by Valiant Peregrine Fund and D1. Neither Sequoia nor Andreessen participated in that round.

Even if Instacart’s IPO can’t lift its valuation anywhere near its Covid-era peak, it’s likely that Sequoia, Andreessen and other venture firms are hoping it helps lift public investor enthusiasm for new tech stocks. Arm, which was taken private by SoftBank in 2016, reentered the public market on Thursday and jumped 25% in its debut.

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