Dec 11, 2013 · 28 minutes

Jesus Christ, Kleiner Perkins just can't catch a break.

The latest news – in a year-long deluge of mea culpas, nasty lawsuits, and admissions of strategic missteps – is that the firm is retrenching, refocusing on the consumer Web, and cutting its early stage investment staff. We know, thanks to a leaked memo to LPs, who is staying: John Doerr, Ted Schlein, Randy Komisar, Beth Seidenberg, and Mike Abbott.

In the weeks since the memo, rumors have swirled about a brain drain at the firm. The party line coming out of Kleiner has been that the partners not named in the memo will be remaining with the firm and simply shifting to other areas. We’ve learned that Bing Gordon is being reassigned as the firm’s Chief Product Officer under its new ProductWorks program and that Chi-Hua Chien is almost certainly leaving, seemingly with hopes of starting his own seed fund. But the fates of a lot of other members of the team are less clear. And given three of these five remaining early stage investment partners are in their 50s, and one is in his 60s, that means the fate of Kleiner Perkins is also very much up in the air.

The firm is not only staying mum on details with the press, they apparently aren’t sharing much more with their portfolio companies. We spoke to several on the condition of anonymity and none knew much more about the firm’s future staffing plans than has been said publicly. In the information vacuum and influenced by the run of bad news coming out of KP as of late, most people we’ve spoken to are assuming the worst.

At the center of the drama is Kleiner’s superstar partner John Doerr. The sad truth of Kleiner Perkins’ current situation is this: Doerr is the one who made them the gold standard of venture firms during the Valley’s biggest run and is the key to its first successful succession plan, but his decision to focus on cleantech is also largely responsible for the firm’s fall. Kleiner’s limited partners have wondered if a 62-year old Doerr would sign up for another fund, and with it another 10-year commitment. This memo removed all doubt. He has to fix this.

If you fell into a coma in the year 2000 and woke up today, the idea the Kleiner is fighting to stay in the top five venture capital firms would be almost unimaginable.

We’ll delve more into Doerr’s missteps and how the changes at Kleiner Perkins affect portfolio companies in a moment. First, though, some context for readers who don’t spend their days swapping Silicon Valley gossip at the Rosewood hotel.

The problem with feeling untouchable

This year, long-time whispers that Kleiner might be in trouble have turned into shouts. The problem with being such a strong number one in the Valley pecking order is any stumble turns into a noticeable, and noteworthy fall. And historically almost no one has ruled venture capital the way Kleiner Perkins has.

The firm’s 1994, 1996, and 1999 funds all delivered massive returns on the backs of investments in Juniper Networks, Amazon, and Google, returning investors 32-times, 17-times, and six-times their money, respectively. But the firm’s 2000 and 2004 marquee funds, as well as its 2008 cleantech fund, have all shown losses. The firm still has nearly $7 billion under management. In fact, it’s raised more than twice as much in the last nine years (approximately $5 billion) as it did in the preceding 32 years ($2.4 billion). This glut of capital to put to work may itself may be part of the problem.

Venture firms are just collections of a few partners, so passing the magic of one's "gut" and personal connections onto a next generation has proven all but impossible.

Few firms have had as storied of a history. Eugene Kleiner and Tom Perkins helped create the venture capital industry. Well before the days of the Internet, their bets on Tandem Computers and Genentech were the kind of old fashioned, bet-the-firm gut calls that no one made back then, and – truth be told – few firms make today. Back then, there was no Y Combinator, no AngelList or no other way to back founders with little more than an idea. A lot was riding on the collective guts of those early pioneers like Kleiner and Perkins. Had they been wrong on the companies they picked, Silicon Valley could have just as easily died before it ever came to life.

In the 1980s, Kleiner Perkins pulled off something equally as remarkable: Succession. Venture firms are just collections of a few partners, so passing the magic of one's "gut" and personal connections onto a next generation has proven all but impossible. Several big firms have exploded when founding partners rode off into the sunset, while others have simply faded from dominance. But Kleiner – with its two second generation superstars in John Doerr and Vinod Khosla – navigated the shift better than almost any other firm had. In the late 1990s the firm had a guy owning the consumer web and another owning telecom and infrastructure. It seemed untouchable.

Today, Kleiner Perkins seems to be falling victim to the same harsh laws of capitalism that has made the firm billions of dollars: No one is untouchable forever. In Silicon Valley, complacency kills startups and VC funds alike – it just takes longer when you have billions under management and a ten year investment horizon.

Kleiner still has plenty of money under management and John Doerr still has mega-sway in tech and political circles. But it's getting hard to argue that Kleiner Perkins' best days are ahead of it. It still needs to hire or promote a rock-star younger generation of partners with more relevant operating experience. From that perspective, these staffing changes have to be a reset not a final solution.

Absent a quiet settlement, the Valley is poised for an ugly OJ moment in 2014, and its most venerable firm will be in the middle of it at a time when it can ill-afford the distraction and another black eye.

If that weren’t enough, this summer, the Ellen Pao sexual harassment suit will go to trial. In another bit of unlucky timing, the trial between (Pando investor) Michael Arrington and Jenn Allen is also set for the summer, with the firm of feminist super-lawyer Gloria Allred defending Allen. The scandalous nature of the latter might steal focus from the Kleiner trial, but given both involve the page-view-grabbing topic of gender equality in the Valley, it's more likely that the two cases will be presented as a newsworthy trend, guaranteeing increased coverage of both. Absent a quiet settlement, the Valley is poised for an ugly OJ moment in 2014, and its most venerable firm will be in the middle of it at a time when it can ill-afford the distraction and another black eye.

How'd we get here? How could a firm that helped start an industry, fund cycle after cycle of giants, and even manage succession once fall so far, so quickly?

Part of it was bad decisions and part of it was just plain bad luck. The same forces, in other words, that can easily doom the companies the venture industry funds.

The sad, slow unraveling of the Kleiner mystique

You could argue that Kleiner’s bad streak started with the departure of Vinod Khosla to start his own firm in 2004. Not everyone agrees that the loss was all bad for Kleiner: Khosla Ventures has had it’s own struggles and Khosla is a notoriously difficult personality. In the days of Doerr and Khosla, Kleiner wasn’t exactly known as a harmonious team. “There were some venture firms that would all go out and play tennis together on weekends in white shorts. That was not us,” Doerr said during our May PandoMonthly fireside chat. “We are not a family, but we are a family business.”

More to the point, a solo Khosla made the same all-in bet on cleantech that bedeviled Kleiner. Still, it’s hard to deny the returns were better when the firm had two superstar partners, not one. At the time, the sense in the industry was that if any firm was strong enough to support such a high-level departure, it was Kleiner.

Kleiner didn’t stand still, but its next "big name" hires were equal parts brag-worthy and head-scratching. Colin Powell? Al Gore? The only thing weirder was Elevation naming Bono as a partner. Even Kleiner’s big names from industry like Oracle’s Ray Lane hadn't built companies before. They’d run behemoths.

Doerr defended these moves during PandoMonthly saying:

Between Al Gore and Colin Powell, we have, I think, two of the most respected Americans in the world, who didn’t join us to become nameplates. These leaders are passionate about technology…

Al Gore was in the office today. He made phone calls – I can’t tell you who they were to – but he made a phone call to move forward the strategy of one of our digital companies who you would recognize, like by leaps and bounds.

I think I encouraged us to do too much green too fast – I’m kind of an enthusiastic investor – but I think it’s in the right balance right now. 

It’s not that Gore and Powell don’t add value. They just aren’t the reason a young entrepreneur picks a venture firm. And they hardly spend every day building relationships across the Valley and vetting incoming dealflow. From the outside, it seemed Kleiner was adding on nice-to-haves, while the must-haves withered. It was almost as if the firm was becoming something other than a venture firm.

But the biggest problem wasn’t (entirely) personnel. It was strategy. Kleiner made the fateful decision to bet heavy on cleantech – diverting the attention of Doerr, the firm’s bona-fide superstar who had made his reputation on the consumer Web. As Doerr has admitted since, including during our PandoMonthly, that bet didn't work out as planned. That’s putting it mildly. He said:

Certainly in a number of ways I was wrong. I also think in other ways – yeah I am trying to defend this – I was right. But cleantech is not a sector, it’s actually a spectrum. And within that spectrum, there are sectors that are crummy.

I think I encouraged us to do too much green too fast – I’m kind of an enthusiastic investor – but I think it’s in the right balance right now. And I’m very proud of the companies we invested in. I hate losing money, but we’re only going to lose one times our money. The real goal is to find and focus on those opportunities that are very large.

With the departure of Khosla and the lack of any next big bat to fill the void, Doerr’s moves would be crucial. And he was seemingly devoting all of his energy to the wrong sector. Give him credit: He had enough of a name brand he could have played it safe and sat in his office, letting deals come to him. Instead, he made a move as gutsy as the investments in Tandem and Genentech that made the firm. Only, this time, the firm was wrong. Or at least its timing was.

At the same time, Kleiner “hired up” and segmented the firm into silos of healthcare, IT, and cleantech. That’s a lot of what’s getting ripped out now. Increasingly, the early stage partnership will work as a single inter-disciplinary team.

Doerr sacrificed one of the best cleantech bets of our era partially to assuage the ego of a partner who ultimately didn’t work out.

The problem was less that the bets were all horrible, after all there’s a saying in venture capital that you can only lose one-times your investment. The bigger problem was the opportunity cost. While it was chasing cleantech, the firm missed out on the early wave of Web 2.0 hits like Facebook and LinkedIn.

And even within cleantech there were whiffs. Segway was an audacious bet to get people around cities more efficiently. It could have worked out, but a last minute move from the postal workers’ union tanked the company’s fortunes. Meanwhile, Doerr backed Fisker over Tesla. The reason it didn’t get Tesla was simple: Doerr wouldn’t join Tesla’s board, and Elon Musk wanted the marquee partner if he was going to take a lower price.

During Musk’s July 2012 PandoMonthly, he recalled the story, saying:

One thing that’s important is, if you have a choice of a lower valuation with someone you really like and a higher valuation with someone you have a question mark about, take the lower valuation…

In the case of the Tesla Series C...there were two competing bids. One was from Kleiner Perkins and the other was from VantagePoint. Kleiner offered a $50 million pre-money valuation, VantagePoint offered $70 million. I actually said to John Doerr, that if John joins the board, we’ll do it at $50 million. But, John felt that he had too many obligations and that there was another partner at Kleiner who really wanted the deal so he could not supplant that person.

I felt, I would be ok with that 40 percent difference [in valuation] if John was willing to join the board, but not with somebody else. That was probably a mistake.

[Then Kleiner invested in Tesla competitor Fisker.] And that was their mistake.

That other partner? Oracle’s Ray Lane. Doerr sacrificed one of the best cleantech bets of our era partially to assuage the ego of a partner who ultimately didn’t work out.

Kleiner did get in Twitter, but relatively late and for a high price compared to its firm-making Series A bets on Google and Amazon. Ditto with Groupon. But at least it earned a meaningful return on Twitter, which was the recipient of the largest single check Doerr has ever written. They seemed to realize the mistake of losing focus on the sector with Doerr suddenly raising his profile in the consumer space again, and launching the sFund, a social media investment vehicle, while wearing a hoody at Facebook.

By the late aughts, Kleiner was looking long in the tooth, but it still had a chance to string together a narrative of why it would remain a top five firm. Doerr was still on the board of Google and Amazon – two of the most powerful tech giants who hadn't lost an ounce of mojo. He was hosting US Presidents at his house with other tech dignitaries. He was friends with Steve Jobs. He could get calls returned and favors called in that few VCs could compete with. Those are all assets for a young, uncertain entrepreneur. And Doerr is charismatic. He can make you believe.

Meanwhile Kleiner was again making a play at succession planning. As Doerr told the PandoMonthly audience:

We put more talent in the partnership on digital, on mobile. In the last 3 years we’ve almost tripled the amount of digital talent in the firm. We brought in Bing Gordon, we promoted Chi-Hua Chien to a senior partner, we recruited Mike Abbott, we promoted Trae Vassallo, we recruited Mary Meeker. I’m spending my new time – the most recent boards I’ve joined – on digital. And that’s because of [the mobile] explosion.

As Doerr noted, Kleiner added some fresh and often young talent to the early stage partnership. The problem is, none of these new names, save for Mike Abbott, will have investment roles at the firm going forward.

The arc of venture up-and-comer Chi-Hua Chien is a stark example. His addition infused some much needed young blood to the senior team. He didn't have a huge investing or operational track record but he did have one big bragging right: While an associate at Accel*, he was the one who flagged Facebook as a company they should look at – a deal that was passed on to Kevin Efrusy and then rainmaker Jim Breyer. So at least, he "got" it. But now he’s on the way out. Many of the companies he backed like Klout, Path, Zaarly, and Everlane are left in a lurch. From what we understand, Chien will remain on their boards. But they no longer have a strong advocate within Kleiner. What does that mean for that Kleiner advantage to call in the big favors?

The biggest sign Kleiner had righted the ship and finally bagged a consumer unicorn was a deal done by Bing Gordon in just his first year with the firm: Zynga. He didn't invest in Zynga’s earliest round, but he bet big well before anyone knew to take social gaming seriously. And by all accounts, he did a lot of heavy lifting to help make Pincus successful. Zynga was that cornerstone that Kleiner was looking for. The new "digital skyscraper" as Pincus would describe it or "Internet treasure" as Doerr put it.

The firm’s $35 million investment was reportedly worth $650 million at Zynga’s IPO price of $10 per share. Unfortunately, the firm still holds the majority of its position in Zynga, and the stock has since plummeted, reaching as low as $2.29 and trading today at $4.13. What was an 18-fold return is currently up just eight times. And the clock continues to tick on realizing those returns.

Kleiner has paid up in recent years to get into some competitive consumer deals like Flipboard, Path, Klout, and Zaarly. The trouble is most of these deals are doubles at best, not the home runs Kleiner needs to get back on top.

Now that Gordon is no longer part of the early stage investing team, he won’t be spending his time finding the next Zynga. He’ll be helping the totality of Kleiner’s portfolio develop better products. It’s a role that he’s played naturally in the past, and one that has the potential to increase returns firm-wide. But it’s hard to imagine this would have been Gordon’s first choice, calling into question how long he’ll stay at Kleiner without access to its big checkbook and the reputation-building value of leading its next generation of investments.

Kleiner has paid up in recent years to get into some competitive consumer deals like Flipboard, Path, Klout, and Zaarly. The trouble is most of these deals are doubles at best, not the home runs Kleiner needs to get back on top. Flipboard appears to be the firm’s best deal of late, as the company recently raised another $100 million at an $800 million valuation and crossed the 100 million user marks. But it’s not SnapChat in terms of valuation, and it’s long-term value remains similarly uncertain.

Meanwhile, Klout has slogged along with more questions than answers; Instagram and SnapChat have trounced Path in the next-gen social network; and Zaarly has been outpaced by verticals in the sharing economy like Uber and Airbnb. Ngmoco was an early bet and a big win, returning more than half of the then $200 million iFund (which has since increased in size). But this was weighed down by high-priced bets on companies like Sean Parker’s Airtime. Sure, other VCs took a bath on that one too. But many other VCs could afford a black mark.

Kleiner put some wins on the board in 2013, but none were of the headline-grabbing, firm-making variety. The year’s IPOs included Chegg, Foundation Medicine, Epizyme, Five Prime, Veracyte, and Silver Spring, while Edgespring, Waze, 41st Parameter, and OptiMedica were each acquired. The firm also sold its 14-year-old stake in Kleiner also has promising early stage investments in Flipboard (Series A), Mandiant (Series A), Nest (Series A), One Kings Lane (Series A), Coursera (Series A), as well as later stage bets in Square (Series C), Spotify (Series D), LendingClub (Series F).

To be clear: Kleiner is doing fine, particularly compared to most venture firms. It’s just not doing Kleiner-good.

While the strategic moves were a mixture of hits and misses, Kleiner’s personnel problems raged on. It added another super star partner in Mary Meeker. But she is better known by people who were in the industry in the late 1990s – not exactly the Y Combinator crowd. Another hire was Meg Whitman – like Ray Lane, she had a big name and proven chops scaling a multi-billion dollar private company but no experience as a founder or investor. She’d quickly move to a more suitable job running HP.

Meanwhile, Aileen Lee left to set up her own seed stage shop with Doerr’s blessing. It would prove fortuitous timing: She could still leverage the Kleiner name while it was strong, but got out before it got ugly.

All of this personnel drama – Khosla, Lee, Lane, Al Gore, and Colin Powell – would pale in comparison to the salacious sexual discrimination lawsuit of Ellen Pao. The truth in that case is still far from known, and there are just as many reasons to doubt Pao’s account of things. So far neither side has come out of it looking good. And this summer when it goes to trial, everyone will look worse.

Doerr made a smart PR move in May of this year, deciding to come clean and show humility. He participated in a Forbes cover story, and later that month sat down with us for a frank two-and-a-half hour conversation on stage. He owned up to the firm’s missteps and even said he himself had a lot to learn about how the game in venture capital had changed.

The venture industry is intensely competitive, it’s changing. We’re reimagining what we should do at Kleiner to serve entrepreneurs. We’re very critical of our own organization and how we can make it better. And, a lot of stuff has changed. It’s way easier to start a venture than it ever was before, and as I said the goal is to build really big companies. The size of the markets are so large – a billion connected devices, which in theory you can get to download something the next day.

We believe at Kleiner that you can make money anywhere along the development stages of a company, provided you’re a good investor – you’re not trying to cut a tough deal with an entrepreneur. Today, we’re investing across wider range of stage of company than ever before, and we’re more focused than ever on trying to build great businesses...

I wish people wouldn’t [put me on a pedestal]. I do think [the industry] has changed, and I do need to adapt. I tweet, I follow teets, but I don’t tweet daily...I wish I could blog, I envy people who can blog, but I struggle with words – they are the enemy.

The May news cycle looked like it could be the turn in luck Kleiner had been hoping for, or at least a shift in the narrative. Coming clean is always a good move. Kleiner was no longer pretending cleantech had been smart. It was no longer pretending it hadn’t missed a step in the Web. It was simply telling us why it was relevant, why it’s track record still mattered and why it was back on track. The plan was to eliminate the “silos” that had divided its investment teams, reduce management fees, and get back to the industry-dominating ways of a generation ago.

And to a lot of people, he was pretty convincing.

And then, the October memo leaked.

Don’t let the Doerr hit you...

We’ve been told by several sources close to the firm that the latest reorganization news came as little surprise to its limited partners. In fact, Kleiner’s top brass had been promising big changes for as long as 18 months, even as Doerr was sitting on stage talking up the partners who would be leaving. The first signs were the reduction in management fees and the elimination of investment silos announced in February. This fall’s partnership shake-up seems like the next step in Doerr’s plan to resurrect the firm that once ruled Silicon Valley.

That said, entrepreneurs in Kleiner’s portfolio have said the opposite: That partners knew change was coming vaguely, but the actual decisions came down hard and fast, like a punch in the gut to some involved. “It still doesn’t seem like anyone knows what’s going on,” said one speaking on the condition of anonymity.

Both the mechanics and the potential impact of these moves remain up in the air.

We’ve been told publicly that the partners not named in the memo will be remaining with the firm and simply shifting to other areas like the growth investing or the firm’s China fund. The behind the scenes narrative has been less certain. Rumors have begun to emerge that Chi-Hua Chien will eventually leave the firm and has designs on launching his own early stage fund. For what it’s worth, we’ve heard the same from those close to Chien. The fates of other high profile names remain to be seen.

But “taking on non-investment roles within the firm” is frequently a euphemism in the venture business. Partners rarely get fired. Typically, they just fade away and get shuffled around, often retaining existing board seats and keeping a desk, a phone extension, and an email address at the firm. But this is little more than semantics. Make no mistake about it. Early stage is the core of what Kleiner does, and anyone not leading the firm’s investment efforts in this area is being demoted. This is a painful come to Jesus reset.

It was a mix of bad strategy, questionable hiring, betting on the wrong horses, and just plain bad luck that got Kleiner to this place. 

That reset has been barely covered in the press and many in the industry have spent the last few week wondering why. Is it that everyone had already written Kleiner off? Or is the public fall from grace still so shocking? Is it that Kleiner snuck this into a news cycle that few picked up on? Or are reporters simply digging around for more details? It could be any of the above. But looking at the last fifteen years that lead Kleiner to this memo, the answers of what went wrong are all out there.

It was a mix of bad strategy, questionable hiring, betting on the wrong horses, and just plain bad luck that got Kleiner to this place. A similarly lethal cocktail has killed some of its ballsiest bets like Segway. Were this to happen any other firm without the history and institutional heft of Kleiner, it could have never survived this long. 

A firm that started so laser focused on a handful of bets and a clear way of doing business, has become a victim of its own runaway success. It could pull anyone to join its ranks – from major CEOs to major global dignitaries. Like the companies it funds, its superstar partner wanted to save the world – in his case that meant taking on Global Warming rather than the next promising social network.

In the last decade, Kleiner has invested in big ideas and big bets the way we all say we want the industry to. It frequently invested in great talent like Dean Kamen and Mark Pincus. When it didn’t pick the wrong strategy; it frequently picked the wrong horse. The sad truth is there are so few massive home runs in the venture industry, one deal won or one deal lost can determine who is in the top five. And that can determine future deal flow.

Kleiner is hardly done. It should be comforted by some historical perspective. Accel* was in an even worse situation after the dot-com bust. But then it found Facebook. Greylock* was similarly an East Coast powerhouse that had fallen on hard times. It wasn’t remotely clear that a little-known former member of the Excite@Home mafia named David Sze could be the answer. Investments in LinkedIn and Facebook followed, while fellow Greylock partner Aneel Bhusri funded and founded Workday. Single moves can resuscitate flailing reputations in the venture world. It’s a harsh truth of the business that makes for a great narrative when it goes right. In Kleiner’s case, it just went wrong one too many times.

If it can happen to Kleiner it can happen to any firm, seemingly overnight. Many in the Valley recognize this, leading them to root for Kleiner to rebound.

In many ways, the Silicon Valley ecosystem needs Kleiner Perkins to be healthy. For entrepreneurs, investors, and LPs alike, much of current system relies on a belief that the big institutions will be there tomorrow. After all, if it can happen to Kleiner it can happen to any firm, seemingly overnight. Many in the Valley recognize this, and they are rooting for a rebound.

There are two things Kleiner needs to do next. The first is immediately do a better job communicating with its existing portfolio. The implicit message when you fire investing partners who brought in deals like Klout, Zaarly, and Path is that the firm doesn’t like those deals. And many of them still have promise. Even if they don’t, those entrepreneurs are the ones that future founders will ask whether they should take money from Kleiner. The firm can hardly afford bad word of mouth in the founder community right now. Kleiner needs to send a strong message that these companies are still loved.

From what we’ve heard, communications have instead been vague and ambiguous. A happy face over the confusing staffing changes were the big unspoken elephant in the room at Kleiner’s recent Christmas party, we’ve heard from several entrepreneurs. “I hope they bounce back,” said one entrepreneur, who noted Kleiner had always been more helpful than any of his other investors. But even this person noted, recommending Kleiner to a friend would be hard right now. “It’s hard to take money from a firm going through so much turmoil,” this person said.

Kleiner is presumably being vague because they are trying to respect the feelings of members of the firm who are moving on. But in doing so, they may be creating a bigger problem.

“It’s hard to take money from a firm going through so much turmoil."

Longer term, Kleiner needs to take another stab at succession planning. These five partners have all made contributions to Kleiner’s relevance, but the industry has changed mightily since most of them had operating roles.

Part of Kleiner’s strategy will be investing in the intersection of tech with industries like healthcare and, yes, sustainability – which it recently started calling “new industrials.” This isn’t a bad strategy. One could consider Uber a sustainablity company. The collision of atoms and bits is one of the most exciting investment thesis out there right now. Andreessen Horowitz made a similar move towards that software-eating-all-industries expertise this week with the hiring of Balaji Srinivasan. Kleiner partners Beth Seidenberg, the former head of R&D at Amgen, and Randy Kommissar, who did the early investment in Nest, will also be crucial assets when it comes to this strategy.

But no one is kidding themselves: For Kleiner to remain a top five firm it absolutely must dominate in consumer Web. It isn’t doing so now. And it’s hard to see how these five partners fix that.

Going down with the ship

Defending the venerable brand against claims of sexual harassment, offering painful mea culpas to endowments he’s delivered billions of dollars in profits to in the past, recruiting yet another generation of partners, and courting know-it-all 20-somethings out of Y Combinator: This can’t be how Doerr was expecting to spend his 60s. He could have walked away when he was on top after the dot com crash. He could have peeled off and done his own fund like Khosla did. He could have left this problem to someone else. He’d certainly made enough money and accomplished more than most VCs ever do. The John Doerr era would have always been remembered as Kleiner’s peak.

But Doerr was playing for legacy. He’d funded Web giants who had changed the world and now he wanted to save it from global warming. This was about his ego maybe, but, as we learned in his impassioned TED talk, it was also about the world he wanted to leave to his kids.

Perhaps his ego was too great. Perhaps he believed he had the Midas touch. But give Doerr credit for one thing: If Kleiner Perkins is going down, he’s going down with it. His reputation is forever intertwined with the firm’s. As came across in our PandoMonthly, he feels a responsibility to the legacy he inherited. This happened on his watch, and he’s going to fix it. He is not taking the easy way out.

The highest compliment in Silicon Valley is saying an investor or founder stuck around when times got tough, rolled up their sleeves, and didn’t give up. As Ben Horowitz says, “Being a founder CEO is the one job you can never quit – unless you’re a punk.” Doerr isn’t a founder or a CEO, but that’s what he is doing. Even the haters have to give him credit for that.

If there’s any good news from this reset it’s that Kleiner is acknowledging what haters have been whispering about it for much of the last three years. The long cycles of venture capital and some $7 billion under management give the firm the luxury of continuing to dine out on its past. But at least Kleiner is clear that it’s no longer living in it.

[Disclosure: Accel and Greylock are investors in PandoDaily.]

[Image courtesy Thomas Hawk]