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Justin Hibbard
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June 09, 2005

Strolling down MemoRay Lane

Sarah Lacy

First off, my apologies to loyal Deal Flow readers for being somewhat M.I.A. on the blog. Among many, many things keeping me busy was an interesting two hour interview with software veteran and Kleiner Perkins Caufield & Byers partner Ray Lane on the lazy Friday before Memorial Day weekend. We were there to talk about a recent investment of Lane's that I'm writing about for BusinessWeek Online next week, and general goings-on in software land.

Lane is a refreshingly honest VC. Ask him a question and he'll tell you an answer. Towards the end of the interview, the conversation turned to Kleiner Perkins- a firm that's undergoing a lot of change in personnel as Deal Flow has chronicled here and here.

KPCB is deep into succession planning and it's high-time. According to Lane, he and famed venture capitalist John Doerr will likely only invest for another 10 years. Firm co-founder Brook Byers will probably be out sooner than that. Add to that the urgency from other famed venture capitalist Vinod Khosla going part-time and former partner Kevin Compton-- who according to Lane could have been the next Doerr-- deciding to leave the venture business and teach highschool. Just recently, Lane saw the first planning scenario that had him going part time. "At first I said, 'Wow that's kinda scary,'" he says, then reality set in that the scenario was several funds away.

So what does KP look like five years from now? In terms of personnel, says Lane: “John and I will be here and very active. Brooke will have transferred over to Dana (Mead), Beth (Seidenberg) and Joe (Lacob). Matt (Murphy) and Aileen (Lee) will be partners. Bill (Joy) and Randy (Komisar) will be hitting their stride. Russ (Siegelman) and Ted (Schlein) will be the senior guys of the firm.” A few more additions will be made soon too, he says.

But despite such transition, he expects the firm won’t be much different. KP is a very institutionalized firm, and all these newer entrants are being trained in the KP way, Lane says. Still, with acts like Sun Microsystems, Genentech and Google to follow, pressure will mount for the new entrants to prove they’re KP-stock as the plan Lane describes plays out.

06:35 PM

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As the economic and business and consumer and global and financial environments are evolving quite rapidly and likely to be very, very different five years from now, the suggestion that he expects "the firm won’t be much different" is a *sure* recipe for disaster. I suspect that he was being quite disingenuous by suggesting that KP (and the entire venture capital sector, for that matter) won't be radically different five years hence.

Any such "business as usual" claim should be viewed with great skepticism.

On the other hand, as I've heard in Washington on more than one occasion, we (including journalists) should be very careful to distinguish "public pronouncements" from "private intentions."

-- Jack Krupansky

Posted by: Jack Krupansky at June 14, 2005 03:15 PM

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