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FORTUNE.COM // MAY.1.19
And it’s a reminder that something as elusive
as identifying early-stage winners from the
pack of wannabes doesn’t get easier, even
after more than four decades of practice. The
story of what happened in the past handful of
years at Kleiner is also one neither the firm’s
partners nor the notoriously tight-lipped VC
industry around it are interested in discuss-
ing, at least on the record. Doerr, Meeker, and
other Kleiner principals all declined to be in-
terviewed for this article or to comment. But
more than 20 current and former employees,
investors in Kleiner’s funds, entrepreneurs,
and other industry observers did talk about
what went wrong and how, if possible, the
firm can ever regain that old Kleiner magic.
HAVING TO SWEAT TO GET INTO a promising
startup would have been unthinkable during
Kleiner’s golden years, from its founding in
1972 through its $11.8 million investment in
Google in 1999. The firm made legendary in-
vestments in startup icons including Tandem
Computers, Genentech, Sun Microsystems,
Electronic Arts, Netscape, and Amazon.com.
Like any venture firm, which invests so early
investment team outperformed the venture
group overseen by longtime Kleiner leader
John Doerr and a rotating ensemble of lesser-
known investors who joined and left him over
the years. Meeker, not the venture capital
investing unit, was landing stakes in the era’s
most promising companies, including Slack,
DocuSign, Spotify, and Uber, breeding resent-
ment over tension points as old as the invest-
ing business: Who gets the credit and, more
important, who gets paid.
Worse, a class system developed inside
Kleiner, evident to the outside world as well,
notably among entrepreneurs mulling ac-
cepting Kleiner’s money: Team Meeker was a
top-tier operation while the venture unit was
B-list at best. Says Ilya Strebulaev, a Stanford
finance professor who studies venture capital:
“Twenty years ago, Kleiner Perkins was at the
pinnacle of venture capital. These days it’s just
one of many firms trying to compete.”
What happened next is another age-old tale
in the business world, of how a once-proud
stalwart found itself on the edge of irrel-
evance. It’s about just how much succession
planning matters and the ramifications of not
adequately grooming the right successors.
“ Twent y
years ago,
Kleiner
was at the
pinnacle
of venture
capital.
These
d a y s i t ’s
just one
of many
firms
trying to
compete.”
Feb. 2006
Kleiner forms
$200 million
“pandemic and
biodefense
fund” focused
on preventing
infectious-
disease
pandemics.
May 2008
Kleiner launches
a $500 mil-
lion fund that
focuses on
later-stage
“clean tech”
investments.
One, electric-
car maker Fisker
Automotive,
goes bankrupt.
Nov. 2010
Mary Meeker
announces she’ll
leave Morgan
Stanley and Wall
Street to join
Kleiner to lead
the $1 billion
digital growth
fund.
May 2012
Ellen Pao sues
Kleiner for gen-
der discrimina-
tion. She will
lose her case,
but the firm’s
reputation suf-
fers badly in a
public trial.
March 2016
Doerr becomes
chairman of
Kleiner Perkins.
June 2016
Kleiner Perkins
raises $1 billion
for its third
growth fund.
Aug. 2017
Mamoon Hamid
joins from
Social Capital.
Sept. 2018
Early-stage and
growth-stage
funds announce
split.
Jan. 2019
Having left
Kleiner,
Meeker targets
$1.25 billion for
debut fund out
of her new firm,
called Bond.
FISKER AUTOM
OTIVE: RACHEL M
URRAY
—GET T Y IM
AGES; M
EEKER: TONY AVEL AR
— GET T Y IM
AGES; PAO: JOSH
EDELSON
— GET T Y IM
AGES; DOERR: M
ICHAEL KOVAC
—GET T Y IM
AGES; HAM
ID: KEVIN M
OLONEY FOR FORTUNE
