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November 12, 2007
Gore & Doerr: KP's Penniless New Venture Partner
I have had a few media calls today about Al Gore joining Kleiner Perkins as a venture partner. Some of the questions are about what it means to be a venture partner -- answer: whatever KP wants it to mean -- and others are about what Al Gore will do -- answer: who knows, but it does show how important politics remains in cleantech.
But I've mostly been asking people who call if they, in talking to Doerr & Gore at KP have asked the obvious two questions:
- How much time will he spend?
- Is he getting paid, and is it carry or management fee?
The answer to the first question is a little fuzzy, but at least we now have an answer to the second question. He's not getting paid -- almost. Okay, he is getting paid, but 100% of his salary, whatever it is, is going to the Alliance for Climate Protection. Gosh, Al is just so darn noble, so unlikely everyone else in venture capital and private equity.
Waitaminute. Unlike everyone else? Hmmmm. There is a reason why this industry is full of grabbers and greedheads. Not only is greed good in venture capital, it's necessary. This is not philately, let alone philanthropy; it's generating returns for impatient investors. You should want your venture team to be greedy, and if they're not then ask yourself whether their interests are aligned with yours. I'm not saying Gore isn't a fine fellow, or that the Gore & Doerr show shouldn't be on Justin.tv or something, but I think it's at least pondering whether you want ungreedy VCs working for you.
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cute, effective "philately"/"philanthropy" pun!
I could make a cliched joke here about being a cunning linguist, but I won't.
I don't really follow the venture capital industry or know much about it, but I do know that KP and Doerr's latest investing push has been all about cleantech.
Hiring Gore on for PR value is an obvious move.
In his presentations on global warming, he stressed the need to market the "green" lifestyle and that is all you see since. Can't go to a major web portal or open a magazine without hearing the "Green" or cleantech angle.
It seems Gore is Doerr's evangelist for hire. Which is basically what Sanjong was getting at in the first comment.
If Gore wants the money for his Alliance for Climate Protection, he might work just as hard for it as any other partner. Given the regulatory hurdles to clean tech, someone of his stature can only help - especially if Democrats get the presidency back.
The doubters on climate change are thankfully irrelevant by now. Even if some governments still try to deny reality, some shrewd VC's will manage to make a buck while helping to fix the problems.
Inventor of the Internet, saviour of the planet, Nobel prizewinner (albeit among the Nobel Prizes, the Peace Prize is equivalent to the 'special prize' or the 'spirit award' nowadays), and now go-getting venture capitalist. Truly Al Gore is a man of many talents.
(For those of you who haven't seen An Inconvenient Truth, here is a short summary.)
EXT: An ice floe with a polar bear. Enter Al Gore stage left.
Al Gore: (waving hands spookily) Wooooooooooo!
(Exeunt logic and reason stage right.)
Parse the statements carefully - he will be donating his salary, and salary for a venture partner is only one component of their compensation. Carry interest is definitely separate and taxed differently to salary as capital gains - recall the debate to tax PE and VC partners on their carry at the same rates as wages and salaries. He does not need the cashflow of any salary and will clean up on the carry.
Brookings fellow Gregg Easterbrook has a good thrashing of Gore in his weekly 6000 word NFL column/blog http://sports.espn.go.com/espn/page2/story?page=easterbrook/071113&lpos=spotlight&lid=tab5pos1
I agree with Easterbrook on Gore but disagree with him where he says that the IPCC half of the award is more justified. I think the IPCC award is worse. A university I used to attend just sent me an e-mail lauding two Nobel prize winning professors who were contributors to the IPCC reports. The award has been retroactively cheapened for legitimate Nobel laureates.
The alternative minimum tax amendment (also extensively covered in the above espn.com link) and Gore’s ability to lobby Pelosi is another possible reason for the Gore hire.
Gore did not invent the internet. He tried to invent the Information Superhighway; a trunk and branch structured system with on ramps and off ramps and toll booths controlled by the government. Fortunately, the free, open web won out. Unfortunately, technology has allowed a synthesized trunk and branch system to be over-laid on top of the web. That’s how those of us north of the boarder have been cut off from pandora.com and other really good content.
Gore's 'man-made' global warming is the biggest crock of crap that the counter-culture has ever tried to get over on the consumer.