Kleiner Perkins to deploy $1.2bn

The renowned Silicon Valley venture capital firm is planning to capitalise on 'disruptive innovation' to solve crucial challenges in energy, healthcare and communications.

Kleiner Perkins Caufield & Byers has launched two new funds: its $700 million (€455 million) KPCB XIII fund and a $500 million green growth fund.

The firm’s thirteenth primary venture fund intends to deploy its capital over a three year period, largely backing early-stage ventures in the greentech, information technology and life science arenas.

“Disruptive innovation is essential to solving today’s crucial challenges in energy, healthcare and communications,” said Kleiner Perkins partner John Doerr in a statement.

Fund XII closed on $600 million in 2006 of which $100 million was earmarked for greentech investments. The eleventh fund closed on $400 million in 2004.

Kleiner Perkins is positioning its green growth  fund as an extension of its past greentech efforts, historically focussed on start-ups. The fund will target companies already in their growth stage with the goal of speeding “mass market adoption of solutions to the world’s climate crisis”, according to the firm. The venture and growth teams will work closely, capitalising on synergies between the two.

Ben Kortlang

The fund will be managed by partners John Denniston and the incoming Ben Kortlang with the intention of growing the team over the coming year. Kortlang previously co-directed alternative energy investments at Goldman Sachs.

The green growth fund follows in the footsteps of Virgin Green, a $400 million private equity fund launched by Virgin Group in August 2007. Virgin Green targets opportunities in renewable energy and energy efficiency with a focus on expansion and growth capital deals.

Kleiner Perkins began investing in greentech in 2002 and has been a pioneer in promoting the development of green technologies. The greentech activities of both funds will extend the firm’s collaboration with London-based Generation Investment Management, launched last November. As a result of that alliance, Generation chairman and former US Vice President Al Gore joined Kleiner Perkins as a partner. Kleiner Perkins now advises Generation on relevant market insights, due diligence and investment opportunities.

Generation  closed its second fund this week on $683 million for investment in a mix of private and public companies developing solutions to global warming, including technological advances in renewable energy, building efficiency, fossil energy, sustainable agriculture and carbon markets.

Kleiner Perkins’ track record includes past investments in America Online, Amazon and Google. In March, the firm launched a $100 million “iFund” to back companies building applications, services and components for the Apple iPhone and iPod touch platforms. The firm also opened two offices in China and launched a $360 million country-specific fund in May 2007.