Fresh data for emerging VC managers from 2,079 US venture funds. Probably the largest such analysis for funds under $500M AUM ever completed.
And yes, we included top decile marks for IRR, TVPI, and DPI 🙏
Carta serves many more venture funds across many categories, so we’ve narrowed this analysis in a few ways to make it more impactful. Only U.S. funds are included, and all included funds are direct venture investors (as opposed to fund of funds). We also left out venture funds that had total committed capital under $1 million.
Funds must have been in vintage years 2017 through 2022. Each vintage year includes at least 120 underlying funds (and far more in most vintages). This represents a dramatic expansion of the public data available for small VC fund performance.
Note that this report does include data from funds over $100 million as well, a traditional delineation point between emerging and established managers.
𝗗𝗮𝘁𝗮 𝗛𝗶𝗴𝗵𝗹𝗶𝗴𝗵𝘁𝘀
𝗧𝗵𝗲 𝘃𝗲𝗻𝘁𝘂𝗿𝗲 𝘀𝗹𝗼𝘄𝗱𝗼𝘄𝗻 𝗶𝘀 𝗹𝗲𝗮𝘃𝗶𝗻𝗴 𝗮 𝗺𝗮𝗿𝗸: For every fund vintage from 2017 through 2020, the past two to three years have brought significant declines in median IRR. For the 2017 vintage, for instance, median IRR fell from 16.8% as of Q4 2021 to 12.0% at the end of Q4 2024.
𝗧𝗼𝗽 𝗱𝗲𝗰𝗶𝗹𝗲 𝗧𝗩𝗣𝗜 𝗶𝘀 𝗵𝗶𝗴𝗵𝗲𝘀𝘁 𝗶𝗻 𝘀𝗺𝗮𝗹𝗹𝗲𝗿 𝗳𝘂𝗻𝗱𝘀: In the upper tiers of performance, the smallest venture funds often post the best returns. In the 2018 vintage, the 90th percentile for TVPI among funds with $1 million to $10 million in assets is 4.03x. For funds in the same vintage with $100 million or more in assets, the 90th percentile for TVPI is 1.67x.
𝗠𝗼𝘀𝘁 𝗻𝗲𝘄𝗲𝗿 𝗳𝘂𝗻𝗱𝘀 𝗮𝗿𝗲 𝘀𝘁𝗶𝗹𝗹 𝘄𝗮𝗶𝘁𝗶𝗻𝗴 𝗳𝗼𝗿 𝗗𝗣𝗜: Half of all funds from the 2018 vintage have still not distributed any capital back to their LPs. For more recent vintages, distributions are even harder to find: Just 26% of funds from the 2020 vintage and 12% of funds from 2021 have begun to record DPI.
Full report live now: https://lnkd.in/dswa4XC4
#VC #venturecapital #emergingmanagers #VCfunds #fundperformance
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