Israeli venture capital funds that invest in hi-tech companies raised $473 million in 2006, a drop of almost $1 billion from 2005 levels, according to the annual survey measuring venture capital fund raising released Tuesday by the Israel Venture Capital Research Center. The 2006 fundraising figure also was less than one-sixth of the record high of $4.1b. raised in 2000 and was down 67% from 2005, yet the drop was expected since most large Israeli VCs completed capital campaigns over the last two years, raising $2.52b. according to the IVC's annual survey. Nevertheless, the 2006 fundings brought the total capital available for investment to $1.5b., of which $900m. has been designated for "first investments" in hi-tech companies, with the remainder reserved for "follow-on" investments. Fundraising was projected to rebound to around $700m. in 2007. "It is expected that the next capital raising cycle of the leading Israeli VC funds will start later this year. Additionally, all the remaining VC funds - those that last raised capital in 2000 and 2001- will also try to raise follow-on funds," said IVC Chairman Zeev Holtzman. Companies invested in by VCs tend to come to maturity only after 10 years and, therefore if a venture capital fund wants to invest in additional projects, it needs to conduct a capital campaign, Holtzman explained. He added that Israeli technology companies received $1.6b. from venture funds in 2006, and similar numbers are expected for 2007. Efrat Zakai, the Director of Research at the IVC, noted that Israeli VCs tend to follow a set pattern in their capital-raising systems, with the 2007 campaign being the fifth since 1992. The IVC measures capital campaigns by vintage year, which is the year in which the venture firm either made its first closing or first investment. Closing is the minimum threshold a VC needs to reach before it begins investing, while the first investment means that a company has begun to receive funds from the VC. Between 1992 and 2006, Israeli venture capital funds raised approximately $11.7b. which was allocated entirely to investments in Israeli hi-tech companies. Some $6.82b. of the total was raised between 2000-2006, while the top 20 firms here accounted for almost $7.7b of the capital raised over the last 15 years. The Pitango management company came out on top in the IVC's survey in which it ranked the top 20 Israeli venture capital funds based on capital managed from 1992-2006, as well as for capital raised from 2000-2006. Pitango has raised $800m. over the last seven years, and has managed more than $945m. since 1992. The number two spot belonged to Evergreen Venture Partners, with Gemini Israel Funds in third place.