US Private Equity Funds Raised up 32% in Q1
Despite the slowdown in the economy, overall private equity fund-raising remains strong, with venture capital increasing by more than $1 billion in the first quarter compared to last year.
According to data from Private Equity Analyst, reported by Dow Jones VentureWire (subscription required), 81 U.S.-focused PE funds raised $58.5 billion in the quarter, up 32% from the $44.3 billion raised across 68 funds in the same period a year ago. Private equity includes venture capital, secondary, mezzanine, buyout and other strategies.
The venture capital market in particular is being viewed more optimistically than other areas.
Venture firms raised $4.9 billion this quarter across 32 funds, up from $3.8 billion raised by 22 funds at this point last year.
Despite potential concerns that the lack of an IPO market will make exits more difficult, observers expect more money to flow to VC firms this year, as well as other niches less dependent on debt financing, VentureWire reports.
“If you’re a top-tier mezzanine, middle-market PE or VC player, you will be perceived as attractive right now, in part because you’re not quite as dependent on what’s going on in the credit markets,” said Jay Tannon, partner at DLA Piper.
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