Venture capital fundraising fell to a 13 year low, with just 25 funds raising capital in the second quarter. That was the smallest number of funds raised since the third quarter of 1996, according to a report released today by the National Venture Capital Association.

Total amount raised during the quarter was $1.7 billion, down from $4.6 billion in the first quarter. The $1.7 billion was the lowest amount raised since the first quarter of 2003 when $938 million was raised.

We've been writing about the troubles in the venture industry, including some industry observers who think the traditional model of VC investing is broken.

“The slower venture fundraising activity is no surprise given the current environment,” said Mark Heesen, president of the NVCA, in a statement. “The final manifestations of the bubble burst combined with a troubled exit market make it a very difficult time to raise money. We believe that many venture firms are waiting until 2010 and beyond to go out to their limited partners who, in an improved market, will look more favorably upon the asset class vis-avis other alternatives."