Canaan Partners kicks off the year's VC fundraising market.
Canaan had raised $650 million for its eighth fund back in 2007. The downsizing was based on the firm's desire to get its investment cycle down from four years to three years, according to general partner John Balen. It had originally sought just $550 million this time around, but accepted a bit of over-subscription from both new and existing investors.
The firm plans to invest around two-thirds of its capital into information technology companies, with the remainder being used for life sciences. The majority of those portfolio relationships will begin in the seed and early stages.
Around one-quarter of Canaan's last fund was invested outside of the U.S., and Balen says to expect the same this time around. It has offices in Israel and India, in addition to Connecticut, New York City and Silicon Valley.
As part of the fund close, longtime general partner Eric Young will transition into a venture partner role. Last year, the firm promoted Warren Lee to general partner.
Recent Canaan exits include the sale of chip-maker SandForce to LSI Corp. (lsi) for $370 million and the sale of regenerative medicine company Advanced BioHealing to Shire PLC for $750 million. It also helped bring The Active Network (actv) public last May.
Overall, 169 U.S.-based venture capital funds raised $18.17 billion in 2011, according to data released this morning by Thomson Reuters and the National Venture Capital Association. That’s a 32% increase in dollars over 2010 and the same number of funds. The Q4 figures were $5.6 billion raised by 38 funds.
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