March 24, 2006 Venture Market Summary By VentureWire Staff Reporters The heavy fund-raising in the venture-capital industry is continuing, with early-stage investment firm Foundation Capital closing a $525 million fifth fund. Foundation's announcement comes as other venture firms have launched big funds this year. Earlier this month, Polaris Venture Partners of Waltham, Mass., launched a $1 billion fund. And last month, Kleiner Perkins Caufield & Byers, of Menlo Park, announced a $600 million fund, some of which will be targeted at clean technology investments. New Enterprise Associates is said to be wrapping up a mega-fund worth $2.5 billion. Last year, U.S. venture capital firms raised $25.2 billion from investors, the most since 2001, and many firms are struggling to put all that cash to work. The fifth fund has brought in two new limited partners - Purdue University, and notably, the Stanford Endowment, which contributed the most capital to the fund. Stanford is working with a bulging endowment that grew 23% to $12.2 billion in the year ended Aug. 31, including donations and after spending on programs, according to a recent annual survey by the National Association of College and University Business Officers. The university, with its strong ties to Silicon Valley, has benefited significantly from investments in top-tier private venture-capital funds and other types of alternative investments. Most of Foundation Capital's existing limited partners participated in Fund V, the firm said. Returning investors include Harvard University, Yale University, California Institute of Technology, University of Chicago, Hewlett Foundation, Horsley Bridge Partners, as well as other foundations, pension plans, and diversified fund-of-fund investors. The Menlo Park, Calif.-based firm, which specializes in early-stage investments, said Fund V will focus on companies developing networking and telecommunications equipment, semiconductors, software as an Internet service, energy and consumer technology.