Kleiner Perkins raising close to $1.3 billion for two funds: Sources

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Kleiner Perkins Caufield & Byers, the venture capital firm that last year defended itself against an explosive sexual discrimination lawsuit, is raising two funds totaling close to $1.3 billion, according to sources familiar with the matter.

The Silicon Valley firm is looking to raise a growth fund of about $800 million, targeting more mature start-ups, with the balance going to an early-stage fund, said the sources, who asked not to be named because the fundraising is confidential. The funds should close in June and the total amount raised could change, they said.

The new funds come on the heels of a busy few years for Kleiner, and not all in a good way. In early 2015, the firm was in court against former partner Ellen Pao, the conclusion of a three-year process that saw many of its high-profile partners publicly ridiculed for sexist behavior. While Kleiner won the case and avoided a payment of up to $16 million, the reputational damage was steep.

Ellen Pao (center) arrives outside the San Francisco Superior Court with her lawyers on March 24, 2015.
Pao's trial may lead to more discrimination lawsuits

Then in March, a year after the trial, top partner John Doerr announced that he's becoming chairman of the firm and would not be a general partner in any new funds. Much of Kleiner's outsized success in recent decades was tied to Doerr's early investments in, Google and Intuit.

As recently as 2009, Doerr was ranked No. 1 on the Forbes Midas List of venture investors. Since then, he's bounced around and was ranked 22nd in the latest list. This will be Kleiner's 17th core early-stage fund and third growth fund.

"I will remain deeply involved in the daily life of KPCB, continuing to invest on behalf of our funds and my family foundation, and serving on our investment committees," Doerr wrote in a March 31 blog post.

As a firm, Kleiner has had some big wins in recent years, namely Google's (now Alphabet's) $3.2 billion acquisition of Nest in 2014 and FireEye's $1 billion purchase of Mandiant the same year. Among the companies on CNBC's 2015 Disruptor 50 list, Kleiner is an investor in 15, more than any other firm. They include Slack and Dollar Shave Club.

But it hasn't gotten the kind of returns that rivals Sequoia Capital, Benchmark, Greylock Partners and Accel Partners have generated from mega-hits like Facebook, Twitter (Kleiner came in late), Workday and WhatsApp.

Judge rules for Kleiner Perkins on Pao court costs
Judge rules for Kleiner Perkins on Pao court costs

Still, should Kleiner get close to $1.3 billion, it would show investor confidence hasn't much diminished. The firm raised $1.2 billion in its last funds in 2014, with about the same split between its early-stage and digital growth funds.

It's also further proof that despite a miserable stretch for IPOs — there hasn't been a venture-backed offering in the U.S. since December — and concern that 2016 is going to be a difficult year for private financings, venture firms are still a major attraction for big institutional investors.

Andreessen Horowitz is reportedly trying to raise about $1.5 billion, following a first quarter that saw venture fundraising jump 59 percent from a year earlier to $12 billion. Founders Fund, Accel and Norwest Venture Partners each raised over $1 billion in the first three months of the year.

A man walks past a logo at Google's European Engineering Center in Zurich April 16, 2015.
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Kleiner's terms look like this: The firm will receive a standard 2.5 percent management fee tied to the size of the funds, and a 25 percent carry, or its take of the profits, the sources said. If the early-stage fund reaches a point where it quadruples returns for investors, the carry jumps to 30 percent, and for the growth fund, it needs to triple to see that increase, according to sources.

(Fortune had some of the above details in an earlier story.)

A Kleiner spokesperson declined to comment.

Since Doerr is no longer in the new funds, management is being shared by Ted Schlein, Beth Seidenberg and Mary Meeker. The other general partners are Mike Abbott, Eric Feng, Wen Hsieh and Mood Rowghani, Doerr wrote in his post.