Venture Investors Increase First Half 2012 Fund Raising

(A. Kotok)

Venture capital (VC) funds in Europe and the U.S. have increased their fund raising in the first half of 2012 by double-digit percentages, according to Dow-Jones LP Source, a financial industry research service. More fund raising by VCs indicates potentially more financing available for start-up companies liked those backed by venture investors.

LP Source says in the first six months of 2012, 82 U.S. venture funds raised $13 billion, a 31 percent increase in capital secured over the first half of 2011. The 82 VCs  raising funds is a 12 percent increase over the 73 firms in first half of 2011.

Funds raised by early-stage investors in the U.S. more than doubled from $1.3 billion in the first half of 2011 to $3.1 billion in 2012. Multi-stage funds increased their capital raised by 35 percent to $7.7 billion in the first half of 2012. Later-stage funds declined 28 percent, however, to $2.1 billion, compared to the same period in 2011.

In Europe, 27 VC funds raised $2.3 billion, a 26 percent gain compared to the first half of 2011. The 27 companies raising funds matches the number for the first half of 2011.

Early stage funds in Europe attracted most of the capital secured in the first half of 2012, raising $1.5 billion across 17 funds, a 34 percent increase compared to the same period last year. The $689 million raised by multi-stage funds was about the same as the $681 million raised during the first half of last year. Later stage funds did not report any closings, which LP Source says is not unusual for Europe.

The gains made in funds raised by VCs mirrors increases in private equity fundraising overall, says LP Source; VCs are a subset of private equity investors. In the first half of 2012, U.S. private equity funds raised $86 billion, a 27 percent increase in capital raised, while in Europe private equity funds raised $37.3 billion in the first half of 2012, a 39 percent increase in capital. In both the U.S. and Europe, however, the number of private equity funds raising capital declined compared to the first half of 2011.

Read more:

•  U.S. Venture Deals, Dollars Decline in Q1 2012
• Venture Funds in U.S., Europe Raise More Cash in Q1
• Venture Investment for European Companies Drops in 2011
• U.S. VC Investments Up for 2011, Flat for Science Companies

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