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SAN FRANCISCO — Former Netscape Communications CEO James Barksdale and his three venture capital partners are going their separate ways after investing most of a $180 million fund created in 1999 during the dot-com boom. 

The Barksdale Group’s decision to disband, announced Tuesday, illuminates the uphill battle facing small venture capital firms in a high technology downturn that has imperiled hundreds of tech start-ups launched in the past two years. 

When they started their firm, the Barksdale partners joined a crowd of wealthy technology executives looking to build upon their riches by investing in promising Internet start-ups. Using $90 million of their own money, the Barksdale partners bet their pedigree would help separate them from the rest of the pack. 

The group included three former Netscape executives — Barksdale, Peter Currie and Quincy Smith — who worked at the company while its Web browser paved the way for the dot-com frenzy. 

Another partner, Danny Rimer, made a name — and fortune — for himself by handling some of Silicon Valley’s hottest initial public offerings of the 1990s, including the stock market debuts of Netscape, At Home Corp., CNet, Verisign and Inktomi. 

But a tech meltdown that began in 2000 forced venture capitalists to spend more time nursing their existing portfolios, while making it difficult to raise more money for future investments from skittish institutional investors. 

Veteran venture capital firms with resources are in a better position to cope with the shakeout than a boutique firm such as the Menlo Park-based Barksdale Group, Currie and Rimer said in separate interviews Tuesday. 

“In an environment like this, operating from a bigger platform is a sounder way to invest,” said Currie, a Barksdale general partner who is leaving to join the Palo Alto office of General Atlantic Partners 

Greenwich, Conn.-based General Atlantic has 18 partners and more than 130 employees in offices in the United States, Europe, Asia and Latin America. 

More venture capitalists probably will seek refuge at bigger firms during the next few years, Rimer predicted. A native of Switzerland, Rimer is leaving the Silicon Valley for London, where he will scout new investment opportunities for the Geneva-based Index Fund. 

“You are going to see a lot of consolidation, similar to what we have seen in the investment banking industry,” said Rimer, 31. 

Barksdale is joining Currie as a special adviser at General Atlantic. He intends to split his time among board meetings, investments and working on the Barksdale Reading Institute, a Mississippi literacy program that he seeded with a $100 million donation last year, spokeswoman Leslie Bottoms said. 

Smith hasn’t announced what he will do next. 

The Barksdale partners will continue to hold regular telephone meetings as they decide what to do with the roughly $54 million left in their fund. The money, representing 30 percent of the original fund, is being held in reserve primarily to provide additional financing to 14 Barksdale-backed companies still in business — a list that includes Tell Me Networks, myCFO.com, Neoteris, Kontiki and Moxi Digital. 

“The jury is still out on our fund, but we fully expect to have positive returns,” Rimer said. 

The Barksdale Group’s investments included a $5 million stake in one of the Internet’s most spectacular failures, online supermarket HomeGrocer.com, which merged with rival Webvan in 2000 and landed in bankruptcy court last year. 

Two other Barksdale-backed start-ups were sold last year — online photography site Ofoto to Eastman Kodak for $58 million in cash and software maker CrossGain Corp. to BEA Systems for $25.1 million in cash and stock. The proceeds were divvied among many other investors besides the Barksdale Group.