Bloomberg: 62 venture capital funds in the U.S. raised $21 billion in the first quarter
In the first quarter of 2020, 62 venture capital funds in the U.S. were able to raise US$21 billion of capital despite the economic downturn, Bloomberg writes, citing data from the research company PitchBook and the National Venture Capital Association.
According to Cunchbase, association consists of 450 companies, more than 1000 of them in the U.S., Forbes wrote in 2018.
In the first quarter of 2020, these funds raised US$21 billion, while in 2019 they managed to get US$51 billion. In mid-2019, the companies also had funds amounting to US$121 billion. Among such funds Bloomberg calls Tiger Global and New Enterprise Associates.
New venture capital funds are in a difficult position, the publication notes. In the first quarter of 2020, only nine "newcomers" managed to attract US$1.1 billion each.
Because of the pandemic, fund managers are unable to meet with potential investors. In this situation, preference is given to well-known companies - you do not have to meet with the head of the company face to face to trust them with money, the publication explains.
Investor focus has shifted, stresses Bloomberg. In the first quarter of 2020, the funds have invested US$5.7 billion in pharmaceutical and biotechnology companies amid Covid-19 pandemic. This is less than what was given to software startups popular with investors (they got US$9.9 billion), the publication notes. But in 2020, the first group attracted US$1 billion more than last year, while developers attracted less than US$1 billion.