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January 12, 2015

VCs had strongest year since 2007

Venture capital firms in the United States raised the most money in seven years in 2014 in spite of a 9-percent drop in the fourth quarter, a new report said Monday.

The VC firms raised $5.6 billion during the quarter, down from $6.2 billion in the fourth quarter of 2013, according to the Fundraising Report by Thomson Reuters and the National Venture Capital Association (NVCA).

But for the year, the firms raised $29.8 billion, the highest level since they raised $30 billion in 2007, the report said.

The fourth-quarter money came from 75 funds, which is up from 62 in the fourth quarter of 2013. For all of 2014, the money came from 254 funds, a jump of 23 percent from 2013. That made 2014 the busiest year for U.S. venture capital fundraising since 2001, when 324 funds were raised, the report said.

“It’s good to see that fundraising levels are finally starting to catch up with the overall level of investment we’ve witnessed in the last few quarters,” said Bobby Franklin, president and CEO of NVCA, in a statement distributed by Thomson Reuters. “As a result of the strong exit market for venture-backed companies over the last couple of years, more money is being distributed back to investors who have chosen to redeploy that capital to the venture ecosystem.”

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