Kleiner Perkins looks to raise $1.3B across two funds

Despite the VC downturn, firms have had little trouble raising big funds this year

One of the strangest things about this economic downturn is how it has only affected one side of the equation. It's harder for companies to get money, but venture capital firms are raking it in, getting more funding than they have in a decade.

The latest firm to go out looking for the big bucks is Kleiner Perkins Caufield & Byers, one of the most established firms in the Valley.

The firm is looking to raise $1.3 billion across two funds, according to a report out from CNBC on Monday. That includes a growth fund of about $800 million, which would target more mature start-ups, with the other $500 million going to an early-stage fund.

The funds are still being raised and the numbers may change when they close, which is expected to happen sometime in June. 

Founded in 1972, Kleiner Perkins Caufield & Byers focuses its investments in three categories: digital, clean tech and life sciences. It has made more than 500 investments including in AOL, Amazon, Compaq, Electronic Arts, Google, Intuit, Juniper Networks, Netscape, WebMD and Zynga.

The last time the firm raised a fund was back in 2014, when it got $1.2 billion, which it also split betweenan early-stage and a digital growth fund.

Since then, it has had a rough time, with a high-profile sexual harassment lawsuit from former partner Ellen Pao, as well as the announcement from Founding John Doerr in March that he will become Chairman of the firm, rather than being a general partner in any of its funds. Getting a big new fund would certainly help the firm shake off any potential negative feelings about these developments. 

Vator reached out to Kleiner Perkins Caufield & Byers for confirmation of this report, but the firm would not comment. 

Venture funding raising in 2016

KPCB is far from the only firm to raise a big fund this year, as many firms seem to be looking to get as much capital as they can before the well potentially dries up.

Founders Fund, which raised $1.3 billion for its sixth fund, the largest fundraising commitment of the first quarter.

Others have included General Catalyst, which raised an $845 million fund, and Battery Ventures, which was able to raise $950 million, in February. In March, Lightspeed Venture Partners raised $1.2 billion across two funds. In April, Accel Partners raised a $500 million fund to invest in Europe and Israel. 

In all, venture firms in the United States raised $12 billion in the first quarter of this year. Not only does that equal an increase of dollars by 59 percent year-to-year, it's the best fundraising quarter since Q2 of 2006, when $14.3 billion was raised. 

The fact that firms are still getting such big checks in a down market explains why deal sizes are actually going up. 

VC investments were down 18.5 percent quarter-to-quarter in Q1, but while the number of companies getting money is way down, the number of dollars actually were not affected. There was $30 billion invested in the quarter, down only 6 percent from Q1 2015, but also up 13 percent from Q4 2015, when $26.6 billion was invested.

As such, the median deal size increased from $1.6 million in Q1 2015 to $2.3 million in Q1 2016.

The largest new fund reporting commitments during the first quarter of 2016 was from 1955 Capital, which raised $200 million for the firm’s inaugural fund.  

(Image source: ihb.io)