Venture industry kissing and telling sets new precedent
As if things weren't bad enough for venture investors, one limited partner has revealed all about the funds it has invested in thus exposing previously-confidential VC performance, according to this Dow Jones story in the Wall Street Journal (subscription required):
The investment arm for Texas's $13.3 billion university endowment jolted the traditionally closed-door venture-capital industry this month with the abrupt disclosure of individual financial returns for nearly 150 private equity funds in which it has invested.
The disclosure -- which prompted intense public scrutiny of what in many cases proved to be horrible-looking returns for newly-created funds -- embarrassed and angered venture capitalists nationwide and also left many afraid of what could come next.
...Utimco's investments in VC funds raised within the last three years are down substantially, in some cases by more than 50%, the disclosure showed. Austin Ventures is a case in point, with Utimco reporting a 73% internal rate of return on its investment in a 1995 Austin Ventures fund, but a negative 54% rate on its investment in a 2001 fund. Crescendo Ventures is another, with Utimco's internal rate of return pegged at 25% for a 1997 Crescendo fund but negative 45% for a 2000 fund.