In the US, 71 venture capital funds raised $9.1 billion in the second quarter of 2008, according to Thomson Reuters and the US National Venture Capital Association. The number of funds raised in the quarter was down by 14% from the same period in 2007, while the dollar value actually increased, by 3%.In comparison, the first quarter of this year saw just $7.1 billion raised by 70 funds.
“Despite the significant challenges that the venture capital industry is facing in the exit market, this quarter demonstrates the long-term perspective of our institutional investors,’ says Mark Heesen, president of the NVCA. “Venture firms and general partners with proven track records will continue to be successful raising new funds as promising investment opportunities remain strong across a diverse set of industries including life sciences, clean technology and information technology. These are ten-year funds which often have lives that stretch to 15 years or more. The long-term view is the appropriate one to take.”
The ratio of follow-on to new funds was approximately 2:1 in the second quarter of 2008, compared to 4:1 in the second quarter of 2007.
The largest funds raised in the second quarter were Lightspeed Venture Partners VIII, (balanced stage, $800 million), Foundation Capital VI (early stage, $750 million) and Kleiner Perkins Caufield & Byers XIII (early stage, $700 million).