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Wednesday, October 19, 2005

VC Fundraising Still Strong

Venture capital fundraising for the first three quarters of 2005 is already ahead of total fundraising for all of 2004 according to a new study released by the National Venture Capital Association.

In just the first three quarters of 2005 there has been well over $17 billion raised for venture capital and $54 billion for buyout and mezzanine financing.

Accodring to Dr. Jeff Cornwall at The Entrepreneurial Mind, "the money flow has slowed down a bit since Sarbanes-Oxley has all but shut down the IPO market for small to mid-sized firms. However, the funds have had an overhang of cash for almost a year, so their coffers are getting really full of cash."

"What this means to entrepreneurs looking for funding is that the already cash rich venture capitalists have even more money to invest. That makes money more plentiful and terms a little more favorable for ventures looking for equity financing."

BOTTOMLINE: Its is more likely that a VC looks to fund a top-performing organization -- one that has a strong leadership team, attracts and retains quality people, is disciplined in their approach to planning and execution, uses technology strategically, and effectively engages trusted outside advisors.

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