June 30, 2013 - In Q2 2013, 44 US venture capital funds raised $2.9B, which was a 4% decrease in number of funds and an 18% fall in capital raised on a rolling four quarter basis. Consequently, average fund size also fell 15% to just $82MM.
March 31, 2013 - There were 77 venture backed M&A transactions in Q1 2013 with $984MM in disclosed deal value. The number of transactions fell 4% on a rolling four quarter basis, while disclosed value fell 12%. However, the value of only 13% of transactions was disclosed in Q1 2013, while in 2012 the deal value was disclosed for an average of 26% of transactions. Consequently, the decrease in disclosed value is not necessarily representative of the health of the M&A market.
October 9, 2012 - Fund-of-funds have fallen out of favor in recent years due to strategic and structural issues. Historically, fund-of-funds have focused too much on diversification, to the detriment of their performance. With too much diversification, many have mimicked the average of their asset class of focus and, in venture capital, the average has struggled to justify the illiquidity over the last ten years. Further, fund-of-funds charge an additional layer of management fees on top of those charged by their portfolio funds. While these fees are gratuitous when performance merely achieves the asset class index, they are easily offset with outperformance of just 1% annualized above the index (analysis to follow). Fund-of-funds also remain prudent for particular asset classes, including venture capital, and for particular investors, including those with either too low or too high a level of assets under management to diversify appropriately.