Fund-Raising By U.S. Venture Capital Funds Fell 55% in 2009: We Have the Boston, San Diego, and Seattle Details, Too

half, though, was raised by two Boston buyout funds, Charlesbank Capital Partners ($1.5 billion) and TA Associates ($4 billion). Among Boston-area venture firms, Bain Capital Ventures raised the largest amount—$475 million for a fund that remains open. Charles River Ventures ($320 million) and Matrix Partners ($450 million) both raised more funds than they had targeted.

—In Seattle, Dow Jones found that five funds raised a total of nearly $28.6 million last year, although all five remain open to additional investments. Four of those were classified as venture funds: Alliance of Angels; Denny Hill Capital; Divergent Ventures; and Pacific Horizon Ventures. Denny Hill Capital raised the largest amount—$15 million.

—In San Diego, Dow Jones shows just one PE fund-raising in 2009. A buyout fund managed by Capital Creek Partners of suburban Rancho Santa Fe has raised $50.7 million. Last year, we charted the evaporation of San Diego’s hometown VCs and how local tech leaders were struggling to come to grips with the falloff of venture capital activity.

Other highlights that Dow Jones noted in fund-raising nationwide:

—Hellman & Friedman, a corporate buyout firm that has offices in San Francisco and New York, was the standout in the fund-raising gloom, raising $8.8 billion in 2009.

—Buyouts firms, which represent the largest category of private equity funds, saw a 72.5 percent decline in fund-raising last year, with 133 funds raising $53.7 billion. That compares with $195.5 billion raised by 204 funds in 2008.

—Mega funds, defined as funds of $6 billion or more, was a category that saw just six funds raise $14 billion in 2009. In 2008, 12 mega funds raised $75.2 billion.

—Venture capital funds, as reported above, raised $13 billion among 120 funds nationwide, a 54.6 percent drop from 2008.

—Secondaries showed a strong increase, with 21 secondary funds raising $17.5 billion—a new record for the sector and a 57 percent increase in dollars raised over 2008.

—Distressed funds, which are counted as a subsector of buyout funds, raised $14.2 billion across 30 funds, a nearly 67 percent decline in the dollar total from 2008.

—Mezzanine funds raised $3.3 billion among 20 funds, down 92.4 percent from the $43.1 billion raised by 24 funds in 2008.

—Funds of funds raised a total of $8.3 billion across 37 funds nationwide, a 64 percent drop from the $23 billion raised in 2008 by 55 funds of funds.


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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.