Fifty-seven venture capital firms raised $6.3 billion in the first quarter of 2008 according to Thomson Financial and the National Venture Capital Association (NVCA). The number of funds raised in the first quarter of 2008 decreased by 31% from the same period in 2007 while the dollar value remained unchanged.

"The interest by venture capitalists in capital intensive industries such as life sciences and clean technologies will likely drive fund sizes upwards for the foreseeable future," said Mark Heesen, president of the NVCA. "The long term investment horizon coupled with the dollars required to bring these companies from the garage or lab to the market place will compel venture capital firms to raise larger funds or accelerate their fundraising cycle to sustain these promising companies. Yet, since many top tier firms have raised funds in the last few years, fundraising activity may actually slow in 2008. But there is no shortage of opportunities, nor is there a shortage of institutional investors interested in participating in the venture capital asset class."



In the first quarter of 2008, 29 early stage focused funds raised $2.8 billion, 23 balanced stage focused funds raised $3.2 billion, and two later stage focused funds raised $119.8 million. Three expansion or seed stage focused funds raised $108.3 million.



The ratio of follow-on to new funds was approximately 10-to-1 in the first quarter of 2008, compared to less than 3-to-1 in the first quarter of 2007. Five new funds and 52 follow-on funds were raised in the first quarter.

The largest funds raised in the first quarter were Essex Woodlands Health Ventures Fund VIII, L.P. (balanced stage; $734 million), Clarus Lifesciences II, L.P. (balanced stage; $660 million), and Canaan VIII, L.P. (balanced stage; $650 million).