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Jerusalem Global Ventures reduces first fund by $32m

Early-stage Israeli venture capital firm Jerusalem Global Ventures, which focuses on IT, communications and life sciences, has decided to cut its first fund to $156m, a reduction of $32m according to media reports.

‘A few of our limited partners are facing financial difficulties and were looking to reduce their exposure to venture capital and technology in general,' Micah Avni, partner at JGV, told Venture Wire.

‘We also felt that we did not need such a big fund in current conditions and did not want to just sit on the money to collect fees,' he added.

Various US-based venture firms have slashed their fund sizes over the past 12 months. Mohr, Davidow Ventures, for example, cut its seventh fund for the second time in January to around $450m. Mobius Venture Capital cut its Fund VI by $250m in January as well.

The venture capital industry in Israel has been in steady decline since the bursting of the venture bubble in 2000. In 2000, Israeli high-tech companies attracted as much as $3.1bn - this fell to just $1.14bn in 2002.

In a further move to regain investor confidence, JGV is also planning to cut staff compensation, although it is unlikely to make redundancies. ‘We are tightening our belts, especially looking at our portfolio start-ups who are saving every penny,' said Avni.

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