With an eye on hot start-ups with rapidly expanding valuations, mutual funds in recent years turned their attention away from public companies and began pouring millions into private tech companies. But now, things are starting to cool off: a report from The Wall Street Journal says mutual funds are backing away from start-ups, slashing the value of investments they’ve made in highly valuable late-stage and growth-stage upstarts.

In recent months, things have started slowing down in Silicon Valley. Billion-dollar “unicorn” start-ups—private tech companies so called for the supposed rarity of their bloated valuations—have found those valuations slashed by investors. Tech companies aren’t going public, and when they are, they’re not treated kindly by public markets. Even existing public tech stalwarts like LinkedIn have had their valuations chopped nearly in half on the stock market. In lieu of making lists of hot, rising start-ups, analytics firm CB Insights has published a Downround Tracker, a list of more than 55 companies that have raised or exited in down rounds—meaning the company’s sale value or new valuation is less than it was worth to investors before. Venture-capital firm First Round Capital this week published a quarterly letter to its limited partners, warning that the current climate of V.C. funding and valuation pullback is no "temporary blip.” The firm, which has backed companies like Uber and Square, expects that some of its portfolio companies will be marked down, “with many potentially being written off entirely.”

Mutual funds, which have pumped money into late-stage start-ups, have apparently felt the chill of the downturn too: according to the Journal, mutual funds have been downgrading their investments in tech start-ups. Thirteen “unicorns” that Fidelity and Wellington’s funds have invested in have been marked down by at least 5 percent so far this year. These unicorns’ valuations are “at an average of 28% below their original purchase price,” the Journal reports. By contrast, during the second quarter of 2015, 14 start-ups in which mutual funds invested were marked up in value—and only three were marked down.

Morgan Stanley has cut the value of its investments in Palantir, Dropbox, and Indian e-commerce start-up Flipkart. Fidelity has likewise written down a number of its investments, including Dropbox, Blue Apron, and Zenefits. Founders and V.C.s have been “stunned” and “blindsided” by mutual funds writing down their investments, according to the Journal.

It wasn’t always like this. In 2014, asset-management groups BlackRock, Fidelity Investments, T. Rowe Price, and Wellington Management—which now all own parts of at least 40 unicorns—each completed between 6 and 16 late-stage deals each, according to analytics firm CB Insights. Fueled by FOMO, or fear of missing out, and not wanting to overlook the next Facebook—or even the next Uber or Snapchat—mutual funds, along with traditional V.C. firms, contributed to a staggering $58.8 billion in venture capital being invested in U.S. private tech start-ups last year.

But for now, things in Silicon Valley look ominous at best. A contraction in the market, optimistic investors say, can be a good thing: it forces founders to think sustainably and worry about their burn rates, and it separates the wheat from the chaff, eliminating the less-scrappy start-ups. But the fallout from a tech bubble bursting in 2016 would have ripple effects, resulting in companies whose clients include mainly start-ups hurting, and real-estate prices taking a hit. One thing is for sure: the question of a tech bubble burst is not hypothetical. Now, investors, founders, and tech employees in the Valley are just wondering when it will happen.