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Venture Capital

by Mike Masnick

Thu, Feb 16th 2006 3:29am





Kleiner Perkins Sees Profits In Pandemics?

from the cheerful-subject dept

While highly targeted venture capital funds don't always do well, top VC firm Kleiner Perkins doesn't seem to mind them. It apparently did quite well a decade ago with its "Java fund." The latest, which comes as a bit of a surprise, is apparently a $200 million "pandemic fund". It's obviously to fund ideas to prevent pandemics, rather than create them. That's certainly an excellent cause, but a very narrowly focused one -- and one that might raise a lot more questions about likelihood of profits than something that is more broadly applicable like a specific technology. That doesn't mean to imply that this is a bad thing. In fact, it's potentially wonderful and life-saving to invest in pandemic prevention. It'll just be interesting to watch how well the fund actually does from a business standpoint. It seems like their may be a lot of luck involved. If the fund hits a home run by investing in "the cure" for something big, then great. If not...

4 Comments | Leave a Comment..


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  1.  

    Sounds like a bad bet

    identicon
    giafly, Feb 16th, 2006 @ 6:55am

    • If there's no pandemic, the fund value falls and you lose money
    • If there is a pandemic, the economy collapses, or at least hits a major recession, and your money is worth less

    [ reply to this | link to this | view in thread ]

  2.  

    Re: Sounds like a bad bet

    identicon
    Michael, Feb 16th, 2006 @ 8:43am

    Your first bullet is a little off. There is a cost associated with preventing pandemics. As long as the fund invests in companies who are at the receiving end of that transfer of money, the fund will succeed. Of course, the preventors of a malady are usually the ones on the cost side... so who knows.

    But whether it makes a profit or not, it's still a) a great value to society and b) great PR for the firm, which may boost their other funds.

    [ reply to this | link to this | view in thread ]

  3.  

    No Subject Given

    identicon
    Anonymous Coward, Feb 16th, 2006 @ 9:16am

    No Pandemic: You lose money

    Global Pandemic: You die a rich man.

    Sounds like a joy of a fund to invest in...

    [ reply to this | link to this | view in thread ]

  4.  

    What about slow pandemics?

    identicon
    dorpus, Feb 16th, 2006 @ 9:17am

    What if there are no dramatic Hollywood-style pandemics, but instead diabetes slowly consumes the majority of the world's population? Or aging causes a slow but drastic decline in world economic productivity?

    [ reply to this | link to this | view in thread ]


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