Venture fundraising last year reached its highest level since 2001, but slowed dramatically in the fourth quarter, according to a new report from Thomson Financial and the National Venture Capital Association.
“The $2.83 billion raised in the fourth quarter by venture capital firms was the lowest amount raised by the fewest number of funds for the past three years,” the news release said.
NVCA said the slowdown was expected and “welcomed.”
“On the venture side, we are coming to the end of the current fundraising cycle as most firms are now turning their attention to investing the funds raised in the last three years. Additionally, the venture industry is extremely wary of bringing too much liquidity into the asset class. We want to keep fund sizes reasonable so dollars can be deployed smartly,” Mark Heesen, NVCA president, said in a release.
Buyout funds also slowed in the quarter, but throughout 2006 they raised an all time high of $102.94 billion.