In venture capital, Vinod Khosla likes to go his own way, which is why he’s been so successful. He was the founding CEO of Sun Microsystems, and then moved to venture capital and became a star partner at Kleiner Perkins, where he backed Juniper Networks, Cerent (sold to Cisco for $7 billion) and NexGen (sold to AMD and formed the basis for its challenge to Intel). About five years ago, after becoming a billionaire, he left Kleiner and started Khosla Ventures to invest his own money. He was mostly drawn to clean tech at a time before it was popular, but still kept his hand in Web and other tech startups (Aliph|Jawbone, iSkoot, RingCentral, Tapulous, iLike, Slide, Xobni). Khosla Ventures already has more than 50 companies in its portfolio (see slides below).
Earlier this month, Khosla raised $1.1 billion for two new funds, taking money from outside investors for the first time. I spoke with Khosla on the phone about his new fund, his approach to investing, clean tech and more. He compares Web startups to water startups, dismisses entrepreneurs who think about exits before building value, and contends that cleantech companies can command as high margins as hardware or software companies. “It’s a business strategy decision,” he explains.”
In the interview, Khosla talks about his investments in Aliph, RingCentral, eASIC, iSkoot, and Xobni. In terms of what he’s looking for, he declares “we love material science.” And in his seed fund, in particular, he says, “We’re not looking for completeness in things. We’re not looking for business plans. We are not looking for meeting every fiduciary requirement of an investor. We are looking for great technical ideas and great technologists.”
The 25-minute interview and full transcript are after the jump. I’ve bolded parts for emphasis.
