New Enterprise raises $1.1bn

The Reston, Virginia venture capital mega-firm spends six months raising Fund 11.

Reston, Virginia-based venture capital firm New Enterprise Associates (NEA) has closed its 11th fund on $1.1 billion.

 

With 95 percent of its previous fund’s investors returning, NEA secured the final close on its hard cap after a whirlwind fundraising effort that began only last August and was mostly completed by the time of first close at the beginning of December, according to administrative general partner Nancy Dorman.

 

“The fund was mostly all spoken for by the end of November, but we had to wait because some investors wanted to use 2004 dollars,” she said. “We found the fundraising market very receptive. At the same time, the process was fairly intense with quite a lot of due diligence. Our investors were digging in, analyzing companies, our records and talking more with the management group.”

 

Dorman also said this latest fund had more foreign investors than any of NEA’s previous funds, with 17 percent of capital committed to NEA 11 coming from non-US sources. The new fund is less than half of NEA’s previous vehicle, which closed at the end of September 2000 on $2.3 billion.

 

NEA focuses its investing on information technology and life sciences. Following the US tech meltdown, the firm has shifted its focus more towards healthcare investing over the last several years, maintaining a 60/40 ration between its IT and life sciences investments, Dorman said. Late last year, general partners Rob Coneybeer, Ron Kase and Tom McConnell, all of whom focused on IT and communications investing in NEA’s Menlo Park, California office, departed the firm.

 

The new fund is targeting about 60 investments over the next three years, Dorman said, with individual commitments of anywhere between $200,000 and $50 million, depending on the type of company involved in the financing. As of the final close, no investments with NEA 11 have been made.

 

The addition of this latest fund brings NEA’s total capital under management to $6 billion. The firm, founded in 1978, is a major player in the US venture capital industry and also has an office in Baltimore.