Press Release Details

U.S.A., Oct 11, 2010 (Thomson Reuters ONE via COMTEX) --

Fewer Firms Raising Smaller Funds Remains the Trend

New York, October 11, 2010 - Forty-five US venture capital funds raised nearly $3 billion in the third quarter of 2010, according to Thomson Reuters and the National Venture Capital Association (NVCA). This level marks a 40% increase, by dollar commitments, compared to the second quarter of 2010, which saw 51 funds raise $2.1 billion during the period. Most of this increase was attributable to a single $750 million fund closing in the quarter.

    Fundraising by Venture Funds
Year/Quarter    Number   Venture
              of Funds   Capital
                            ($M)
        2005       245  29,786.5
        2006       243  32,125.7
        2007       252  35,426.7
        2008       229  28,500.0
        2009       151  16,455.2
        2010       124   9,103.2
       3Q'08        62   8,449.9
       4Q'08        55   3,620.4
       1Q'09        59   5,373.9
       2Q'09        40   4,718.0
       3Q'09        32   2,310.3
       4Q'09        46   4,053.1
       1Q'10        43   3,968.8
       2Q'10        51   2,142.8
       3Q'10        45   2,991.6

Source: Thomson Reuters and National Venture Capital Association

"With funds sizes getting smaller and fewer firms raising money, we are experiencing a period of time in which venture capital investment is consistently outpacing fundraising, creating an industry that will be considerably smaller in the next decade" said Mark Heesen, president of the NVCA. "While the inclination is to assume that a contracting industry is problematic, most venture capitalists and their limited partners believe that this environment will drive future returns upward without harming innovation and job creation."

There were 31 follow-on funds and 14 new funds raised in the third quarter of 2010, a ratio of 2.2-to-1 of follow-on to new funds. The largest new fund reporting commitments during the third quarter of 2010 was New York-based Raine Partners I, L.P., which raised $303.4 million in its inaugural fund. A "new" fund is defined as the first fund at a newly established firm, although the general partner of that firm may have previous experience investing in venture capital.

 VC Funds: New vs. Follow-On
       No. of  No. of  Total
          New Follow-
                   on
  2005     54     191    245
  2006     67     176    243
  2007     77     175    252
  2008     63     166    229
  2009     42     109    151
  2010     35      89    124
 3Q'08     16      46     62
 4Q'08     17      38     55
 1Q'09     10      49     59
 2Q'09     14      26     40
 3Q'09     12      20     32
 4Q'09     14      32     46
 1Q'10     13      30     43
 2Q'10     13      38     51
 3Q'10     14      31     45

Source: Thomson Reuters and National Venture Capital Association

The largest funds raised during the third quarter of 2010 was Menlo Park, California-based Institutional Venture Partners XIII, L.P. which raised $750 million followed Boston, Massachusetts-based Third Rock Ventures II, L.P., which raised $426 million.

Methodology

The Thomson Reuters/National Venture Capital Association sample includesU.S.-based venture capitalfunds. Classifications are based on the headquarterlocation of the fund, not thelocation ofventure capital firm.The sample excludes fund of funds.

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About National Venture Capital Association

The National Venture Capital Association (NVCA) represents more than 400 venture capital firms in the United States. NVCA's mission is to foster greater understanding of the importance of venture capital to the U.S. economy and support entrepreneurial activity and innovation.According to a 2008 Global Insight study, venture-backed companies accounted for 12.1 million jobs and $2.9 trillion in revenue in the United States in 2008. The NVCA represents the public policy interests of the venture capital community, strives to maintain high professional standards, provides reliable industry data, sponsors professional development, and facilitates interaction among its members. For more information about the NVCA, please visit www.nvca.org.

CONTACTS

Emily Mendell

NVCA

1.610.565.3904

emendell@nvca.org

Jeanette Volpi

Thomson Reuters

1.646.223.5517

jeanette.volpi@thomsonreuters.com

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