Posted 7:23 AM by Blah blah

Venture Capitalist View

Khosla ventures some opinions (San Jose Mercury News):

Vinod Khosla of Kleiner Perkins Caufield & Byers is by most accounts the most successful venture capitalist of the late 1990s. He hit grand slams by backing companies like Juniper, now a public company, and Cerent and Siara Systems, which in 1999 were sold for $11.2 billion in total....He says:

As a philosophy, I'll challenge CEOs and push them hard to think about the issues. But I won't vote against them or force them to do something. Never have in 16 years, not once. If you consistently disagree with a management team, and feel the need to vote against them, then you should change the management team. That's the only decision a board should make in managing a company. Boards should push management teams, ask the hard questions, make them face tough decisions.

In the end, though, the board should back decisions management has made. After the board told Warren we did not have confidence in him and had to find a new CEO (in November 2000), he stayed on for the transition.

When Jagdeep Singh wanted to sell Lightera Networks to Ciena, I signed the paperwork. Then I said: ``Let me start arguing with you about why you shouldn't sell.'' He sold Lightera against my wishes, but I supported him. Three months later, he came back and said: ``You were right.'' That's a very typical style for me. I'll support you in the end, no matter what decision you make, but give me a right to argue with you.

People have suggested that I should go on to new opportunities. But I'm proud of the fact that I work on things even when the chips are down. Juniper made a huge return, but it wasn't a lot of work. Two of the investments that I'm most proud of were Concentric and NexGen. At Concentric, we had so many close calls, we faced bankruptcy. Other investors abandoned it.

I kept working on it and it paid off. At NexGen, CEO Atiq Raza will say that we were the only major investor who supported him when others abandoned him. We were a minority investor. Then we became a majority investor. So when Advanced Micro Devices bought NexGen, they gave us 27 to 28 percent of their stock. The deal saved AMD. I'm proud of it.