Fundraising by venture capital firms and their cousins, the buyout firms, is on track to hit new records.
In the second quarter of 2006, fifty venture capital firms raised a total of $11.2 billion, the highest level since the first quarter of 2001, according to a report released today by Thomson Financial and the National Venture Capital Association (click image below to enlarge).
The firms typically are required by their own investors to invest their cash, regardless of how many good ideas there are out there. So it's a great time to be a small or even large company looking to snag cash from these firms. Disclosure: You may have to certify that you are alive and breathing to get some of this dough, but that may be about all.
Thirty-five "buyout" and so-called "mezzanine" funds raised $30.8 billion. These firms tend to raise larger amounts of cash than venture capital firms because they invest billions into deals like buying whole divisions of companies and spinning them out into separate companies.
Emily Mendell, of NVCA, said the buyout/mezzanine numbers for the first half of the year -- $53 billion -- represent record levels, and that 2006 should be a record for the year. Venture capital levels, however, are still lagging the ridiculous bubble-era -- when more than $100 billion was raised in 2000.