Leading Venture Capital Firms
A search for a list of the leading venture capital firms presents several problems and also points out one glaring reality of venture capital firms in general.
The main problem that would be encountered in a quest to compile a list of the leading venture capital firms would certainly be criteria. What criteria would you use? It might be possible to think of “leading” simply in terms of largest or the one with the most capital invested. However, if you are gearing your list for a potential entrepreneur, it would be how much capital is available to be invested that would create more interest. Also, since venture capital funds tend to concentrate on certain market sectors, the leading firm in the field of real estate would be of little interest to the inventor of a better mousetrap.
There is also a problem of geography. Venture capital is going global at a rapid pace. The largest venture capital firms might well be the global orientated ones. Should the list be restricted to funds located in the United States or only doing business locally? Also, venture capital is a risk taking for high profit type of deal, so should not the leading firms be the ones producing the best ROI regardless of the amount of deals they have made or the amount of capital they have invested?
There is one glaring reality of venture capital that might help you make your list. Venture capital firms are really the workplace of venture capitalists. It is the individual that makes all the difference. This is a business where stars shine. Forbes Magazine understands this reality and their list is called “The Midas List.” It is not a list of firms at all, but of those individuals within the firms that have the Midas touch. If you understand this approach as you should, the list of leading venture capital firms would be the ones that employ these movers and shakers.
In 2008, John Doerr, of Kleiner Perkins Caulfield & Byers, moved to the top of the Midas List. Doerr led Kleiner’s early investment in Google. His firm is also involved in other tech related ventures, several of which are approaching highly profitable exits. Doerr replaced Michael Moritz, who drops the second place. His firm is Sequoia Capital. Logically, they could easily rank 2nd on our list. Interestingly, Ram Shriram of Sherpalo and Asad Jamal of ePlanet ventures at 3rd and 8th on the Midas list, respectively, are heavily involved in global ventures.
The Midas List published by Forbes Magazine is the Cy Young Award voting of the venture capital field. The venture capital firm is just the office of the venture capitalist, and this is a business where “leading” can only be defined as successful. Any number of lists could be compiled breaking firms into local or global, or narrowing them to a particular market sector, but if you are going to claim a list of “leading venture capital firms”, ROI is really your only criteria.