VCs Believe in Obama

Leveraged buyout pros may favor Mitt Romney for president, but venture capitalists are supporting Barack Obama. The Illinois senator raised more campaign contributions from VCs in the fourth quarter than did any other candidate, according to a analysis of Federal Election Commission records. It helped boost Obama’s 2007 tally to nearly $157,000, which also is tops among his rivals.

Romney, on the other hand, got crushed. He raised just $4,850 from VCs in Q4, after having averaged $32,500 during each of the first three quarters. The former Massachusetts governor still managed to hang on to second place for the year, but lost significant ground to Hillary Clinton, who raised $24,050 in Q4 and $70,000 for the year. The rest of the 2007 Top Five were Rudy Giuliani ($34,200), Chris Dodd ($25,000) and John McCain ($23,850). It is also worth noting that Mike Huckabee finally got a private equity donation — from Carl Goldfischer of Bay City Capital. He had previously struck out among both VCs and buyout pros.

I speculated on Friday that the carried interest tax issue may have played a role in Q4 donations from buyout pros, since it was the first quarter in which all the major candidates had declared a position. Specifically, it looked as if Republicans had gained a decided edge by stating that private equity profits should remain taxed at capital gains levels, whereas Democrats believed they should be taxed as ordinary income (except for Chris Dodd, who remained noncommittal). Among venture capitalists, however, the sentiment was reversed – with Democrats receiving around twice as many dollars as did Republicans.

Total VC donations by candidate: VCTotals_2007.xls
Q4 VC donations by individual: VCQ4.xls