Venture Fund for Small Investors

Draper Fisher Jurvetson, a Silicon Valley venture capital firm, said Wednesday that it has raised $330 million in a fund that will allow people to invest in a basket of companies before they go public.

Despite the tech-stock slump that has raised worries about the long-term returns on venture-capital investing, Draper Fisher said its fund, meVC Draper Fisher Jurvetson Fund I, has sold 16.5 million shares at $20 each through underwriters led by Prudential Volpe Technology Group.

The shares, spread among about 20,000 investors, will begin trading on the New York Stock Exchange under the ticker MVC on June 26.

“With the [initial public offering] market the way it was last year, people are expecting big returns. Draper is definitely capitalizing on that wave. The problem is the returns in venture capital are not nearly as quick as in a typical mutual fund, and expense ratios are going to be much higher,” said Toby Walters, product manager for Venture Economics.

The new fund will carry a 2.5% management fee and keep 20% of the profits, similar to most venture capital funds.

Peter Freudenthal, co-founder and president of meVC.com Inc., the new fund’s parent company, said meVC expects to invest in 30 to 50 companies in the next two years.

The new fund will focus on the Internet, electronic commerce, telecommunications, networking, software, and information services. It will invest primarily in later stages of a company’s development before an IPO.