What are Current Venture Capital Funds in Market Looking to Invest In? – April 2014

by Matthew Morris

  • 15 Apr 2014
  • PE
  • VC

With Andreessen Horowitz recently announcing the closure of its fourth fund at $1.5bn, the venture capital market now has in excess of approximately $120bn in dry powder, with a16z topping that list as the firm with the most individually. Preqin’s Fund Managers Profiles online service accounts for 4298 currently active venture capital firms worldwide, with many on the fundraising trail. 

According to Preqin’s Funds in Market online service there are 1302 private equity vehicles currently raising capital, with these efforts aiming to collect an aggregate of more than $433bn. Of these 1302 funds, 41% (534) are focused on venture capital investments and together have a target amount of almost $56bn, with an average target size of $116mn each. This means there are more venture capital funds in market than any other private equity strategy. The largest venture capital fund currently in market is Invention Investment Fund III, which is looking to raise $3bn in commitments to invest into intellectual property. 

Of the 534 venture capital funds in market, well over half have at least a partial focus on the Information Technology sector, making it the industry with the most venture capital interest. These 341 venture capital funds are hoping to collect almost $33bn from investors. The largest fund with a focus on the Information Technology sector is Tiger Global Private Investment Partners VIII, which is hoping to collect $1.5bn in capital commitments. US and North American-based companies should reap the benefits the most, with 172 funds raising almost $16bn looking to focus their efforts here. Africa on the other hand is only expecting to see $371mn for their Information Technology sector, accounting for only 1% of the whole target amount. 

Another large focus for the venture capital funds is the healthcare sector. There are 222 Healthcare-focused funds in market, hoping to garner over $24bn in capital commitments from investors. 48% of these vehicles will be looking to invest in the US and North America, with Africa again receiving the least amount of commitments, at only $478mn. The largest fund in the venture capital healthcare space is Yunfeng Fund II, which is hoping to collect $1bn for investments in a variety of sectors, including healthcare. 

Elsewhere, there are 104 clean technology focused venture capital funds in market looking to raise more than $12bn. These funds are looking to invest more in Asia than any other region, with over $4bn targeted towards clean technology in the continent. The largest solely focused clean technology venture capital fund is Craton Equity Partners II, which is looking to collect $400mn. 

Of the total 534 venture capital funds in market, there are only 16 Africa-focused vehicles, compared to 266 North American-focused ones. Europe and Asia are behind too, with only 113 and 81 venture capital funds looking to invest in their regions respectively. Of the current venture capital funds in market, the greatest beneficiaries will be North American-based Information Technology companies.

Continue browsing industry reports, publications, conferences, blogs and more on Preqin Insights