VC Fundraising - 2010 will be a telling year
The Dow Jones webinar I did with David Bell (Fenwick & West), Sarah Reed (Charles River Ventures), and Lizette Perez-Deisboeck (Battery Ventures) has provided me with a lot of eye catching numbers. I will comment on the VC fundraising numbers in this post (and maybe some others in the future).
According to Dow Jones, VC fundraising by venture funds has risen steadily, from a low of $10.3 billion in 2003, to a recent high of $41.0 billion in 2007. I say recent because in 2000 the raise was $82.3 billion. Year to date numbers for 2009 show a total raise of $8.1 billion. There is still a month to go, and maybe a fund or two will have a closing in December, but this looks like an historic low.
Based on a discussion over lunch with Rick Grinnell of Fairhaven, I believe that there will be an unusually high number of big "A" list funds that will be looking to raise new funds in 2010. In some ways this makes 2010 the year to watch. If a large number of strong players are in the market and the amount raised does not spike up it may reflect that a new, lower, equilibrium has been reached in the market. In effect, 2010 may well tell us how much smaller the venture world will become for the next half decade.
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