Venture capital is drying up quickly in the United States, according to the latest statistics from Venture Economics and the National Venture Capital Association,

Second quarter commitments to venture capital funds plunged 42% from the previous quarter. All told, 65 U.S.-based venture capital funds raised $9.7 billion, compared to $16.7 billion raised by 96 funds in first quarter of 2001. (All figures in U.S. dollars). Fund raising activity was down 68% from a year ago, when venture capital enjoyed its largest quarter, with 178 funds pulling in $30.3 billion.

“After several years of record fundraising levels, venture capital firms intend to invest their current funds over a several-year period, taking their time to find the brightest opportunities. With fewer new funds entering the market, we can expect total fundraising to return back to sustainable levels. The positive news is that much of the capital that has been raised during the past year has yet to be deployed, leaving ample risk equity capital for those entrepreneurs that have a compelling value proposition,” explained Mark Heesen, president of the NVCA.

Firms trying to raise first-time funds continue to have a hard time. Of the 65 funds raised in the second quarter, only 19, were first-time funds. The $911 million raised by first-time funds in Q2 represents only 9% of the total capital raised during the quarter, while first-time funds made up 17% of capital raised in Q1. “Clearly, the more experienced venture capitalists are in a better position to raise funds in the current environment,” says Adam Reinebach, VP of content at Venture Economics. “But the fact that new investors continue to enter this market shows that private equity isn’t going away.”

Venture Economics estimates that as of June 30, the amount of venture capital raised by funds but not yet invested is over $45 billion. This amount, known as “overhang,” is the amount available for investment in companies.

Buyout and mezzanine funds had a flat quarter as 25 funds raised $9.4 billion, down from the $9.23 billion raised in Q1. The $9.4 billion raised in Q2 is down 68% from a year ago, when buyout and mezzanine funds had their largest quarter ever, raising $29 billion through 46 funds. Kohlberg, Kravis, Roberts & Co. accounted for more then half of the quarter’s buyout/mezzanine volume, holding a first close of $4.9 billion for its KKR Millennium Fund, which has a target of $10 billion.