Just 17 venture capital funds raised USD1.6bn in the third quarter of 2009, according to Thomson Reuters and the National Venture Capital Association.
This level represents the smallest number of venture funds raising money in a single quarter since the third quarter of 1994 when 17 funds were also raised and the lowest level of dollars committed since the first quarter of 2003 when USD938m was raised.
"Anecdotally we are hearing that fundraising activity is accelerating as more firms that were waiting for economic recovery are beginning to formally seek commitments," says Mark Heesen, president of the NVCA. "The reality, however, is that many limited partners are still determining their long term strategies in wake of the past year’s financial crisis and that slows the process down considerably. We expect commitment levels to remain modest for the remainder of 2009 with gradual increases beginning in 2010."
There were four new funds and 13 follow-on funds raised in the third quarter of 2009, a ratio of about three-to-one of follow-on to new funds. The largest new fund reporting commitments during the third quarter was Andreessen Horowitz Fund I, which raised USD58.5m in its inaugural fund.
The largest fund raised in the third quarter was follow-on fund Khosla Ventures III, which raised USD750m for an early stage fund, followed by Draper Fisher Jurvetson X, which saw USD196m in fund commitments during the third quarter of 2009.
