Strongest Quarter in Ten Years and More Than the Last Two Quarters Combined
NEW YORK, NY – U.S. venture capital firms raised $12.0 billion for 57 funds during the first quarter of 2016, a 59 percent increase by dollar commitments from the first quarter of 2015 and a 17 percent decrease in number of funds raised, according to the Fundraising Report by Thomson Reuters and the National Venture Capital Association (NVCA). This marks the strongest quarter for dollars raised by U.S. venture capital firms since the second quarter of 2006 when 79 funds raised $14.3 billion.
“As witnessed over the last year, the fundraising environment for venture capital continues to improve. That’s welcome news for venture capital as an industry but even better for American entrepreneurs who will put that capital to work growing their businesses, hiring workers and driving innovation,” said Bobby Franklin, President and CEO of NVCA. “With close to $12 billion raised, the first quarter marks the strongest fundraising period for venture capital in ten years and is more than the fundraising totals of the last two quarters of 2015 combined. While it’s unlikely for this strong pace to continue, we do expect this to be a solid fundraising year when all is said and done.”
There were 43 follow-on funds and 14 new funds raised during the first quarter of 2016. The number of new funds raised during the first quarter marks a 33 percent decrease from the number of first-time funds raised during the first quarter of 2015. The number of follow-on funds raised during the quarter fell 10 percent compared to a year ago.
The largest new fund reporting commitments during the first quarter of 2016 was from
Los Angeles, California-based 1955 Capital, which raised $200 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.
Total commitments to U.S. venture funds in the first quarter of 2016 was led by Founders Fund VI, L.P., which raised $1.3 billion in the largest fundraising commitment of the first quarter. Accel Growth Fund IV L.P. and Norwest Venture Partners XIII, L.P. each raised $1.2 billion during the first quarter of 2016. The top five funds raised during the first quarter of the year account for 43 percent of the overall total, down from 45 percent for the top five funds raised during the first quarter of 2015.
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.