Venture fundraising declines in quarter, rises for year

SAN FRANCISCO Mon Jan 7, 2013 4:48pm EST

SAN FRANCISCO Jan 7 (Reuters) - U.S. venture-capital firms raised $3.3 billion last quarter, down from $5.5 billion a year earlier, marking a weak end to a strong year.

For the full year, venture-capital firms raised $20.57 billion, up 10 percent from 2011 and the strongest showing since 2008, according to data from ThomsonReuters and the National Venture Capital Association.

Some 182 funds were raised over the year, the strongest showing since 2008. For the quarter, 42 new funds were raised, up slightly from 38 a year earlier.

The largest fund raised last quarter was Sequoia Capital's $700 million growth fund.

In general, venture capital is consolidating into what NVCA president Mark Heesen calls a "barbell structure," meaning funds are large and invest across all sectors on one end - and small and industry specific on the other end. Funds in the middle are getting squeezed.

The fundraising numbers come days after the industry said acquisitions and initial public offerings of companies it backed were down last quarter.