Venture funds raise $9.1 billion in second quarter

NEW YORK — Despite a gloomy mood on Wall Street and no recent “exits” through stock offerings for venture-backed firms, venture capital funds raised $9.1 billion in the second quarter.

That total reflects a 3 percent increase over the first quarter of the year and is nearly $200 million more than in the same period for 2007.

The National Venture Capital Association and Thomson Reuters disclosed the data on Monday morning.

For the year, venture funds have raised $16.16 billion, compared with $15.3 billion in 2007.

The fact that venture funds continue to be able to raise capital reflects the strength of the VC industry, said NVCA President Mark Heesen.

“Despite the significant challenges that the venture capital industry is facing in the exit market, this quarter demonstrates the long term perspective of our institutional investors,” Heesen said in a statement. “Venture firms and general partners with proven track records will continue to be successful raising new funds as promising investment opportunities remain strong across a diverse set of industries, including life sciences, clean technology and information technology. These are ten year funds which often have lives that stretch to 15 years or more. The long term view is the appropriate one to take.”

So far in 2008, venture fundraising is on track to top the $36.8 billion raised in 2007 and the $31.8 billion raised in 2006.

In the second quarter, 71 VC firms closed on financing, compared with 70 in the first quarter. A year ago, 83 funds were able to raise money.

Of those 71, 22 were new funds, up from nine in the first quarter and from 16 in 2007.

Lightspeed Venture Partners generated the largest closing at $800 million. Foundation Capital was next at $750 million, followed by Kleiner Perkins Caufield & Byers at $700 million.

The Foundation and Kleiner funds are focused on early stage investments.