Peter Thiel-founded Valar Ventures raised a $300 million fund, half the size of its last one

Valar Ventures raised a $300M fund, its smallest yet amid a tough VC climate.

: Valar Ventures, co-founded by Peter Thiel, has raised a $300 million fund, significantly smaller than its previous funds due to a challenging fundraising environment in venture capital. The firm's investment returns have been lackluster, with notable failures like BlockFi and successes, such as Wise. The broader VC market sees mixed results, with some firms reducing targets and others, like ICONIQ Growth, exceeding theirs.

Valar Ventures, a venture capital firm co-founded in 2010 by Peter Thiel, has managed to raise $300 million for its ninth fund as per a recent SEC filing. This amount is less than half of its immediately preceding fund, reflecting a broader trend of difficulty in venture capital fundraising. Andrew McCormack and James Fitzgerald, both previously affiliated with Thiel through his family office and his hedge fund Clarium Capital, manage Valar, which originally focused on non-Silicon Valley investments, particularly fintech startups worldwide.

In the shifting landscape of venture capital, Valar Ventures' recent fund size reduction aligns with other major players who have similarly had to scale back their fundraising targets. For instance, Tiger Global and Insight Partners cut their fundraising goals, while Founders Fund halved its target for strategic reasons alongside raising a substantial growth fund. Valar itself has seen mixed results from its investments, suffering high-profile setbacks with companies like BlockFi and Breather, though it also counts successes such as Wise, which had a strong public listing.

The current market conditions reflect a general wariness from limited partners (LPs) about the profitability and return on investments from venture capital funds, with Valar facing criticism for its low returns on capital. This sentiment is underscored by Valar's 2020 vintage fund showing a -2.3% internal rate of return, though it's early in the fund's lifecycle, with venture funds typically maturing over a decade. The contrasting fortunes of venture funds illustrate the unpredictable nature of tech investments and the critical influence of market conditions and investment choices.