Forty-two US venture capital funds raised USD4.9 billion in the first quarter of 2012, according to Thomson Reuters and the National Venture Capital Association (NVCA).
This level marks a 35 per cent decrease by dollar commitments and a 9 per cent decline by number of funds compared to the first quarter of 2011, which saw 46 funds raise USD7.6 billion during the period. The top five funds accounted for nearly 75 per cent of total fundraising this quarter as the number of funds raising money during the quarter fell to its lowest levels since the third quarter of 2009, when 36 venture capital funds saw new capital commitments.
"While the first quarter fundraising numbers represent a slower start than last year, venture firms appear to be more optimistic about the fundraising environment in 2012, especially those who have benefitted from the improving exit environment of late which has also been encouraging to our investors," says Mark Heesen, president of the NVCA. "Many venture firms are either now officially in the market to raise a fund or will enter in 2012. For these firms, it will be ‘do or die’ — and the collective outcome of their fundraising efforts will lay the groundwork for the amount of venture capital available for investment in entrepreneurial companies the next decade."
There were 31 follow-on funds and 11 new funds raised in the first quarter of 2012, a ratio of 2.8-to-1 of follow-on to new funds. The largest new fund reporting commitments during the first quarter of 2012 was from Boulder, Colorado-based Fraser McCombs Ventures, LP which raised USD16.9 million for the firm’s inaugural fund. A "new" fund is defined as the first fund at a newly established firm, although the general partners of that firm may have previous experience investing in venture capital.
