Prop 23 Update: VC profits not growing in CA according to one analysis
11/08/2011 4 Comments
If you recall during the Prop 23 debates, we were told that Venture Capitalist were investing in green technology and those investments were going to revitalize the California economy under AB-32. Here is a little insight into how wells some of those leading “go green” VC investors are doing these days.
Distributions from Kleiner and Sequoia Have Noticeably Slowed Since 2003: peHUB Analysis
By: Mark Boslet
The University of California has seen cash distributions from Sequoia Capital and Kleiner Perkins Caufield & Byers decline over the past eight years, as dot-com era investments apparently haven’t been able to match the spectacular returns from earlier funds, according to peHUB’s analysis of data provided by the university system.
peHUB sought performance data for the funds after learning that the University of California Board of Regents had not published updated returns for individual Sequoia, Kleiner and Accel Partners funds since 2003,which may be a violation of state law. The university regularly publishes return data for more than 60 other funds in its venture portfolio.
In response to peHUB’s request, the Board of Regents said that it had not received individual fund performance data since 2003 from Kleiner and Sequoia. It chose to release minimal “aggregate” performance data for the 10 Kleiner funds and 10 Sequoia funds in its portfolio. The board disclosed aggregate drawdowns, distributions and net asset value as of Dec. 31 for both Kleiner and Sequoia. (It also provided those three data points for a single Accel fund in its portfolio.)
The aggregate data show that the University of California invested about $262 million in 20 funds from Sequoia and Kleiner over the past two decades and received about $1.87 billion in distributions, for a 7.1x return.
However, the majority of the distributions — $1.45 billion (or 78%) — came prior to 2004 and primarily from a handful of blockbuster funds from the early and mid 1990s, according to peHUB’s analysis of the aggregate data and data released by the university in 2003. In the past eight years, the LP has received $411 million in combined distributions from Kleiner and Sequoia — suggesting returns between 3x and 4x during that period, according to the analysis.
Sorry, I am unable to provide a link to the rest of the article, as it came by email from a savvy market watcher. While is lear that investors are get a return on their money, it is also clear that “go green” investment may not be the “big deal” we were promised during the Prop 23/AB-32 debates.