Largest First Time Fund of the Year Closes in Third Quarter
NEW YORK, NY – U.S. venture capital firms raised $4.4 billion for 53 funds during the third quarter of 2015, a decrease of 34 percent compared to the number of funds raised during the second quarter of 2015, and a 59 percent decrease by dollar commitments, according to the Fundraising Report by Thomson Reuters and the National Venture Capital Association (NVCA). Venture capital dollar commitments during the third quarter of 2015 decreased 33 percent compared to the third quarter of 2014 and marked the slowest three-month period for venture capital fundraising since the third quarter of 2013 when U.S. venture capital firms raised just over $4.38 billion.
“Venture capital funds raised over $4 billion during the third quarter to be deployed to the next generation of innovative companies that will revolutionize entrenched industries and create new ones altogether,” said Bobby Franklin, President and CEO of NVCA. “Despite being down from the recent high-water mark recorded during the second quarter, total fundraising for the year remains quite strong and has already surpassed annual fundraising marks observed in recent years.”
There were 40 follow-on funds and 13 new funds raised during the third quarter of 2015, a 3.1 to-1 ratio of follow-on to new funds. The number of new funds raised during the third quarter marks a 61 percent decrease from the number of first-time funds raised during the second quarter of this year. The third quarter of 2015 marks the slowest quarter for first-time funds since the first quarter of 2013 when 11 first-time funds saw fundraising commitments.
The largest new fund reporting commitments during the third quarter of 2015 was from Boston, Massachusetts-based Silversmith Capital Partners I, L.P., which raised $460 million for the firm’s inaugural fund and ranked as the top new fund raised during all of 2015. 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.
Total commitments to U.S. venture funds in the third quarter of 2015 was led by Deerfield Healthcare Innovations Fund L.P., which raised $550 million in the largest fundraising commitment of the third quarter. Foresite Capital Fund III, L.P. raised $450 million and Foundry Venture Capital 2016, L.P. raised $225 million.
The Thomson Reuters/National Venture Capital Association sample includes U.S.-based venture capital funds. Classifications are based on the headquarter location of the fund, not the location of venture capital firm. The sample excludes fund of funds.
Effective November 1, 2010, Thomson Reuters venture capital fund data has been updated in order to provide more consistent and relevant categories for searching and reporting. As a result of these changes, there may be shifts in historical fundraising statistics as a result of movements of funds between primary market & nation samples and/or between fund stage categories.