Key Takeaways
- • Kleiner Perkins repeatedly passed on Robinhood, declining to invest in its 2015 round at a $250 million valuation, before Robinhood excluded the firm from its 2017 unicorn round at a $1.3 billion valuation.
- • Kleiner finally joined Robinhood's $363 million funding round in early 2018, valuing the company at $5.6 billion, via its growth fund led by Mary Meeker.
- • Meeker's growth team outperformed Kleiner's traditional venture group led by John Doerr, backing Slack, DocuSign, Spotify, and Uber.
- • The Meeker-versus-Doerr tension over credit and compensation highlights governance and succession challenges at the once-storied firm.
Summary
According to Fortune, Robinhood co-founders Vladimir Tenev and Baiju Bhatt first approached Kleiner Perkins Caufield & Byers to raise $13 million at a $61 million valuation for their no-fee stock brokerage startup. Kleiner expressed interest but declined to invest. In mid-2015, when Robinhood sought $50 million at a $250 million valuation, Kleiner passed again. By 2017, when Robinhood became a unicorn valued at $1.3 billion after raising $110 million, the startup excluded Kleiner from its list of participating venture firms.
The firms finally connected in early 2018, according to accounts from dealmakers on both sides. By then Robinhood's zero-commission model had prompted Fidelity, TD Ameritrade, and Charles Schwab to cut fees. Under the sponsorship of Mary Meeker, a Kleiner partner since 2011, the firm participated in a $363 million funding round that valued Robinhood at $5.6 billion.
The episode illustrates a broader pattern. Kleiner had also missed earlier generations of technology investing, including Facebook in the 2000s. Its traditional early-stage franchise struggled to win the most sought-after startups of the period, while a separate growth vehicle run by Meeker, focused on more mature private companies, produced strong results. Meeker's team outperformed the venture group overseen by longtime Kleiner leader John Doerr and a rotating group of investors. The growth unit landed stakes in Slack, DocuSign, Spotify, and Uber. That performance gap has generated resentment over credit and compensation, long-standing tension points in the investing business.
The firms finally connected in early 2018, according to accounts from dealmakers on both sides. By then Robinhood's zero-commission model had prompted Fidelity, TD Ameritrade, and Charles Schwab to cut fees. Under the sponsorship of Mary Meeker, a Kleiner partner since 2011, the firm participated in a $363 million funding round that valued Robinhood at $5.6 billion.
The episode illustrates a broader pattern. Kleiner had also missed earlier generations of technology investing, including Facebook in the 2000s. Its traditional early-stage franchise struggled to win the most sought-after startups of the period, while a separate growth vehicle run by Meeker, focused on more mature private companies, produced strong results. Meeker's team outperformed the venture group overseen by longtime Kleiner leader John Doerr and a rotating group of investors. The growth unit landed stakes in Slack, DocuSign, Spotify, and Uber. That performance gap has generated resentment over credit and compensation, long-standing tension points in the investing business.
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