DISQUS

VentureBeat: Only 17 venture capital firms raise money in Q3 — fewest in 15 years

  • fredwilson · 2 months ago
    not sure i agree with the opening line Matt. the dollars under management and the number of firms will be smaller for sure, but at some point the contraction will end and we'll be left with a healthier and better VC business.
  • Matt Marshall · 2 months ago
    Sure, they'll decline to a more lower sustainable population. Didn't mean to suggest they'll go extinct. I agree, this will get much healthier.
  • fredwilson · 2 months ago
    i guess i was reading too much into it, as usual
  • Don Jones - VentureDeal · 2 months ago
    This is the inevitable overshoot to the downside. Worldwide equity and bond markets have been rising since March 9 and I expect that the endowments and pension funds will begin to step back into alternative investments in greater force as their portfolios rise in value.
  • Olga Kostrova (IdeaMama) · 2 months ago
    I believe that it's not only the result of economical slowdown, but the fact that the performance history of many VC funds was not so fantastic in last few years. The competition for really strong deals is high, the return usually is not as great as investors expect (with rare exceptions). I see some of my VC friends leave the industry as it doesn't seem to be as lucrative business any longer as it was a few years back I also see investors moving to direct hands-on investment, bypassing the funds. So, for entrepreneurs it's not bad news at all, for VCs might be.
  • mattbowman · 2 months ago
    As the industry shrinks, will the BEST VCs will be "left behind"? While I think anyone who's worked as a VC will be able to provide valuable service somewhere, it's in everyone's interest that value-creation trump non-rational factors as LPs and firms decide who stays and who goes. Matt, you've got a history of bringing transparency to the VC world. What do you think about something like this: http://vator.tv/n/b23. It's an idea that's grown out of my research for the Top 50 VC list: http://alwayson.goingon.com/permalink/post/33468
  • marklittlewood · 2 months ago
    Meanwhile, VCs are starting to spend according to latest news on funding deals from US and Europe. http://bit.ly/VCQ309 No uestion the landscape is changing though.
  • Andrew Walkingshaw · 2 months ago
    Following on from @marklittlewood: we've been tracking the latest European/American VC data at http://timetric.com/labs/venture/. We'll add this data to that ASAP - thank you!
  • Andrew Walkingshaw · 2 months ago
    Done that now. If you going by the Calibre One/BLN data for investments made, then the last two quarters are the first in quite a while where VC funds in North America have invested more money than they’ve taken in! (If you want to analyse the raw data yourselves, you can - it’s on Timetric at http://timetric.com/tags/thebln/.)
  • Tom Turnbull · 2 months ago
    Does a particular focus emerge among the firms raising capital (i.e., cleantech) given that we are seeing downstream cleantech investment heating up again? http://cleanoregon.com/2009/10/02/cleantech-is-...
  • Jeff Bonforte · 2 months ago
    The $1.6B hides that Khosla Ventures raised 2 funds totaling $1.1B and Andreessen Horowitz raised $350M fund. That seems to account for $1.45B of the $1.6B.
  • g1tarr · 2 months ago
    Matt, Great Transparency as usual. One more point is that Corporate VC's are planning to get more active in 2010 as they smell an opportunity to play a stronger role in the Startup Eco-System

    Several LP's that are tired of the typical VC model have been in contact with me to link up Corporates for a new VC Hybrid Fund business model. How the balance of ROI Vs Strategic Works is still being sorted :>)
  • Name · 2 months ago
    The Hybrid Fund model sounds very interesting. As a corporate VC, I would like to learn more. Any current models out there?
  • Greg Tarr · 2 months ago
    There have been two models
    1-The Corporate Spin-Out VC's that keep Corp LP's and recruit new Financial Oriented LP's
    2-Building the Hybrid Fund from the Start which I am currently working on with a few Corporates now
    The benefit is the Corporate Invests less capital, recruits better people and gets access to earlier deal flow with an independent mgmt team. Corp sits on the Advisory Board with linkage to the Head of the BU

    Greg Tarr
    CrossPacific Capital
    gtarr@crosspacificcapital.com
  • brian · 2 months ago
    Perhaps we're just learning that the VC asset class doesn't have as much market beta as originally thought.

    But come on, what asset class is performing well this year? LP's should cut the VC's some slack. Where else did they put their money instead that had such great returns?