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vc-funds55Well, it’s the same old story in the venture capital business. The dominant big funds keep gaining momentum, while the smaller, lesser known funds struggle to raise money.

According to a report out today by Thomson Reuters and the National Venture Capital Association, a total of 48 funds raised $4.9 billion during the fourth quarter. That represented a 12 percent increase in dollar commitments, but a 21 percent decrease in the number of funds.

“Venture capital fundraising in 2013 ended much in the way it began — with continued concentration within the larger funds and a sense of optimism for the coming year,” said Bobby Franklin, president and CEO, National Venture Capital Association. “The difference today is that there is hard evidence of an improving exit market, which will actually help realize some of this positive momentum as limited partners again include venture as a vital component of their portfolio. If the IPO market continues to strengthen and receive quality offerings, we can expect more VCs involved in those exits to raise money in 2014, which will bode well for a new crop of startups looking to raise capital.”

funds-newfollowIn total, VC firms raised $16.7 billion in 185 funds in 2013. That was a 15 percent decline in dollars committed compared to 2012.

The biggest funds for the fourth quarter included $700 million for New York-based OrbiMed Private Investments V and $675 million for Massachusetts-based General Catalyst Group VII.


As we have noted in the past, Washington state has lost many of its venture capital firms over the years, including OVP Venture Partners and Frazier Technology Ventures.

Other large firms such as Polaris Venture Partners, Atlas Venture and Mohr Davidow have shut down their Seattle branches, and home-grown funds like Ignition have shifted focus to put more dollars to work in the Bay Area.

Featured image via Shutterstock.

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