Silicon Valley is feeling some anxiety these days.

Seed round valuations are declining. The number of newly-minted unicorns more than halved in the fourth quarter. Smart money is receding.

The Valley is in the midst of a correction, says accelerator 500 Startups CEO Dave McClure. The investor predicts early stage startups in the tech space will see valuations coming in at about 10 percent to 20 percent less than what companies saw throughout 2015.

But he's not all that worried about it and says startups that take a realistic approach to fundraising will be fine. 

"There will still be capital available for companies that are showing progress," he says.

Still, he says he wasn't changing his advice for startups in 500's Batch 15 or now-in-progress Batch 16 from what he typically tells startups in his accelerators. Batch 15 presents in a demo day Tuesday. 

"We've not generally advised companies to try to jack the market differently," he says.

His tip to companies looking to raise capital: "Don't get too (expletive) cute."

The correction will likely have more of an impact for startups in the accelerators that tend to yield higher than average valuations, like Y Combinator, he says.  

Valuations of startups emerging from incubators tend to fall roughly in the $3 million to $5 million range, according to AngelList. The average valuation coming out of 500 Startups is $5 million and from Y Combinator $6.5 million.

McClure says it wasn't that long ago that the median valuation for startups in the Bay Area was about $3 million. He recalled investing in cloud communications platform Twilio at a $3.5 million cap in 2008 or 2009.

If companies now are upset about $6-$8 million valuations moving back to $3-4 million, "I'll get out my small pity violin for you," McClure says. 

Sure, a slide from $5 million to $4 million would be noticeable "but again I don't think that's the end of the world." He added that the shift may not be uniform: "Dumb money might still price at the previously higher valuations."

500 Startups plans to increase investment in its companies, but the increase will be distributed primarily to startups located abroad, he says.