Norwest Venture Partners, a 65-year-old company backed exclusively by Wells Fargo, has raised its 17th fund at $3 billion.
That’s a remarkable number considering NVP last raised the same amount in December 2021. That was the height of the venture boom, and at that point the company said it had increased its capital pool by 50% (the 2019 NVP fund closed at $2 billion). ) because it needed to remain competitive in the business environment where round sizes and valuations have reached unprecedented levels.
But things have obviously changed since then. Investors are backing fewer companies and valuations have fallen and could do so continue to fall.
Jeff Crowe, a senior managing partner, admitted that the rate of investment in venture capital and certain sectors is slower than it was a few years ago, but said that this is the case when doing business in certain strategies, sectors and regions such as growth capital, healthcare and India Fall is as robust as before the downturn.
“We maintained a very steady pace and achieved a number of nice exits,” Crowe told TechCrunch. “We thought it made sense to continue at the same pace.”
Since closing its previous fund, the firm has helped 36 companies realize liquidity. Not all exits were a good outcome for the company (NVP’s portfolio company). VanMoof filed for bankruptcy protection), but according to Crowe, the returns from certain exits far outweighed the losses. He referred to the sale of the company Spiff to Salesforce, the purchase of Avetta by EQT for a reported $3 billion and the IPO of India-based Five Star Business Finance.
Crowe declined to comment on returns, but said, “This is Fund 17. We’ve been doing this for a long time, and in the venture world, if you get really good returns, you stay in business.”
NVP attributes much of its success to operating out of a large global multi-strategy fund. The company invests in North America, India and Israel. The company has an early-stage and growth equity business and recently added a biotech team to complement its existing healthcare practice.
The diversified approach allows the company to adapt its strategy as the market changes. For example, NVP planned to invest in crypto companies when it launched its last fund, but the sector fell out of favor shortly thereafter and the company did not pursue many deals in the space.
“Our diversified strategy works well through the ups and downs of investment cycles,” Crowe said. “It gives us flexibility. That’s the beauty of it. We react more quickly to changes.”