Friday, July 18, 2008

What the hell happened to Kleiner Perkins? (John Doerr et al [Gore])

That's the question that VentureBeat asks. The article he refers to has an interesting tidbit on "Green" investing, see below. From VB:
How do you know when one of the world’s most respected investment firms has veered off path and bet wrong? That’s the crux of the question raised by a piece in this month’s Fortune entitled “Kleiner bets the farm” that puts Kleiner Perkins Caufield & Byers under the lens for its recent investment decisions....

...Amost a decade later, still without one, the number of skeptics are growing. Lashinsky quotes one source: “What the hell happened to them?” It’s something of a rhetorical question, since Kleiner has actually remained in the headlines, announcing high profile moves such as partner Al Gore, opening a $500 million special fund for green investments, and making high profile investments like the Think America electric vehicle. Kleiner Perkins has staked a lot of its money and even more of its reputation on cleantech being the next big thing.

The firm is betting on some bold, meaningful ideas. None of them are safe. Fuel cells are a notoriously difficult technology, but Kleiner Perkins has bet big on Bloom Energy; ditto for the cellulosic ethanol technology of Mascoma, wacky (and not yet terribly popular) scooters from Segway, and the high-performance electric cars of Tesla Motors competitor Fisker Automotive. Adding it all up, one might begin to think Doerr has lost control of his emotions and begun investing more like a tree-hugger than a tycoon.

The real story, however, is a bit more complex. Lashinky mentions Terralliance, a Kleiner Perkins energy investment that has taken up to a billion dollars. While the firm has spent plenty of time talking up renewable energy portfolio companies like Ausra, it never mentions Terralliance. The ostensible reason is that the company is in stealth mode. But while Terralliance is an energy play, it’s no feel-good green investment; it’s an oil wildcatter that has already drilled up to 100 wells. Another Kleiner Perkins investment not mentioned in the Fortune article is GloriOil, which helps extract more oil from mature wells....