H1 Fundraising Review

Overall, the first half of 2024 was challenging for fundraising across the private fund market to varying degrees among private debt, private equity (PE) and venture capital (VC). The first half of 2024 saw a variety of trends in the fundraising landscape for Venture Capital (VC), Private Equity (PE) and Private Debt. H1 was marked by significant shifts in capital commitments, the emergence of dominant sectors and the resilience of certain asset classes amid market turbulence. The wild first half saw an initial public offering drought leading to a decline in VC fundraising, while PE fundraising increased compared to 2023. Private debt, meanwhile, also saw a decline in fundraising, but the focus on resilient sectors provided some stability. This sets the stage for what is expected to be an interesting second half.

PE continued its late 2023 rebound from the marketing doldrums of 2022 and the first half of 2023. For the first half of 2024, this rebound consisted of an aggregate fundraising of $408.6 billion across 861 final fund closings and is expected to continue in the second half of the year.

Private debt fundraising had a tough start to the year, reaching a total of only $59 billion, the lowest first-half total since 2012. The multifamily and industrial sectors dominated, capturing 87% of the total capital raised. Funds were slow to close, averaging 20.9 months to final close, reflecting a cautious investor approach amid rising financing costs and an uncertain economic outlook. The prolonged fundraising periods and cautious investor behavior could indicate the private debt market may continue to face headwinds in the near term, but the emphasis on resilient sectors like multifamily and industrial could offer a buffer against further declines.

VC fundraising also had a challenging first half, continuing a difficult period for the industry. VC funds collected $80.5 billion in capital commitments globally in the first half of 2024, marking a nine-year low. The number of new VC funds in 2024 overall is expected to be fewer than 1,300, as opposed to the nearly 4,000 launched in 2021. Despite this, leading players in the space continued to secure fresh capital, including General Catalyst and Andreessen Horowitz raising $6 billion and $7.2 billion, respectively.