How fast are VCs deploying their capital?
Unsurprisingly, given the general fundraising environment for startups, recent vintages of VC funds are investing at a slower pace than prior funds.
We are releasing our first-ever Carta VC Fund Performance report tomorrow (shout in the comments for link to the waitlist) and this chart on capital deployment was a fascinating highlight.
Left side is the share of committed capital deployed after a given number of months (right side is the same data just bigger and easier to read 😅).
So US funds from vintage year 2020 on Carta had deployed 60% of their capital after 2 years. The same figure for vintage year 2017 funds stands at 43%.
This has ripple effects for the whole ecosystem. Obviously this is reflected in the slower fundraising for startups, but it also means the return timeframe for LPs is likely expanded.
Will 2023 and 2024 funds follow the same slower path or will a rebound in venture get us back to more normal pace?
Lots to explore - excited to get more fund data into the world!
#startups #venturecapital #VCfunds #fundmanagers
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