| SAN FRANCISCO, March 5
SAN FRANCISCO, March 5 Blue-chip venture-capital
firm Kleiner Perkins Caufield & Byers expressed frustration with
poor fund performance and promised to do better at gatherings
for investors last month, according to people familiar with the
The firm, which has lost some of its shine recently due in
part to hefty bets on green energy technology and a lack of
home-run Internet investments, said it would be more careful
with capital and redouble its efforts to boost performance.
Several investors who received invitations to the meetings said
it was unusual for Kleiner Perkins to hold such gatherings when
it was not raising new funds.
"They're just frustrated and upset that the performance
hasn't been as good as they think it should be, and they are
candid about it," said one investor, or limited partner, who
attended one of the meetings and requested anonymity.
The message was "we're not naïve. We get it," said the
investor. "We're going to work our ass off."
A spokeswoman for Kleiner Perkins said: "Communications
between Kleiner Perkins and its limited partners are private and
confidential. As such, we do not comment on them."
The 41-year-old firm built a reputation by backing
technology titans such as Amazon.com Inc, Netscape and
Sun Microsystems, but recent investments in Zynga Inc,
Groupon Inc and other companies have worked out less
Kleiner Perkins was late to the consumer Internet boom and
has not delivered a knockout return since the initial public
offering of Google Inc in 2004.
The firm's leader, general partner John Doerr, also led a
push into alternative energy technology that has foundered in
the face of competition from China, plunging natural gas prices
and unfavorable government policies.
Kleiner does not release details of its funds' performance
to the public. However, recent results have been underwhelming,
industry insiders say, and the firm acknowledged as much at the
Just a few big hits can heavily influence venture returns,
and some prestigious funds have rebounded after a rocky stretch.
Accel Partners, for example, which was down on its luck in the
early 2000s, rode a successful investment in Facebook Inc
to venture capital's top tier.
At its recent meetings, Kleiner expressed optimism about the
outlook for its newer funds, according to another person
familiar with the discussion.
Kleiner's newest fund, the 2012 Kleiner Perkins Caufield &
Byers XV, closed at $525 million, according to the firm. Its
2010 digital growth fund totals $1 billion, and KPCB XIV, dating
from 2011, totals $650 million.
Many venture firms have sought to strengthen communication
with investors in light of the sector's poor performance in
recent years. "We Have Met the Enemy ... and He Is Us," a
much-discussed study released last year by the Kauffman
Foundation, castigated funds for poor performance and high fees
- and blamed investors for not asking more questions.
While many top firms court investors with invitations to
various events, Kleiner has traditionally been less
communicative. It typically holds meetings to discuss strategy
and performance only when raising money for individual funds,
some investors say.
Last month's meetings were dominated by Doerr, a 33-year
veteran and often the firm's public face, and by General Partner
Ted Schlein, according to the limited partner who attended one
of the meetings. Schlein has been assuming greater
responsibilities for internal operations and investor relations.