VCs Cashed In Big On Google Stock

    June 27, 2005

Greg Linden pointed me to Bill Burnham’s excellent accounting of the amount of money the two venture capital firms that funded Google in its early days, Kleiner Perkins and Sequoia, earned off the mega-billions Google IPO. Suffice to say, they made out like bandits, earning roughly $4.5 billion and $4.7 billion, respectively.

Of course, both gave the same $12.5 million to fund Google, and both received the same amount of shares, so the discrepancies are interesting. Not only has Kleiner Perkins earned $200 million less than Sequoia, but coming to that number requires the accounting of 2.85 million Google shares that just “dissapeared” from accounting records, 1.8 million of which showed up on the books of Kleiner affiliated “Vallejo Ventures Trust”.

I hope that those shares were not involved in some sort of shady deal, but you never know when dealing with financial firms.

Worse, while Sequoia earned $200 million more than Kleiner, it paid $200 million less to the man who brokered the deal than Kleiner did! Sequoi gave Mike Moritz, who also brought us the Yahoo deal, $306 million, far less than the $512 million Kleiner gave their own John Doerr. So, in fact, Kleiner pays their employee more, and winds up with $400 million less than Sequoia, who paid their guy 40% less.

Its all some very interesting stuff, and worth reading.

Greg Linden
Bill Burnham’s article

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Nathan Weinberg writes the popular InsideGoogle blog, offering the latest news and insights about Google and search engines.

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