Beleaguered fundraisers are hoping to bounce back
Distributions are key to an improved fundraising market. 'DPI tells the story,' says QED co-founder and chief investment officer Frank Rotman.
Expert Analysis by Lawrence Aragon & David Bogoslaw
Last year was one of the worst in recent memory for venture capital fundraising. And, although VCs are expressing optimism about the year ahead, it remains unclear if 2024 will show a meaningful improvement.
The key problem, as we discussed last week, is that many LPs can’t or won’t commit to new funds until they start to see substantial distributions from the funds they have already backed. A consistent flow of distributions allowed LPs to recycle capital into new funds in 2021 and 2022, resulting in record VC fundraising totals of roughly $170 billion for each of those years, according to our research.
Our final tally for 2023 isn’t complete yet, but all signs point to a significant...