With cloud-focused companies now accounting for over a quarter of all VC financing in the web/Internet sector, one of the major players is considering the creation of a dedicated cloud investment fund. Guy Daniels reports.
According to a report on Bloomberg, leading venture capital firm Kleiner Perkins Caufield & Byers looks like starting a new fund that will be focused on start-up companies that sell cloud services to SMEs. It is believed that the VC firm could invest $100 million in the market.
The news is partly confirmed by Matt Murphy, a partner at Kleiner Perkins, who told Bloomberg’s Tech Deals blog that they “have talked about it, and are intrigued by the idea”. He also confirmed the likely $100 million figure for the first year.
The fund would complement Kleiner Perkins’ existing ICT funds, including a $250 million fund focused on social media start-ups and the much-talked about $200 million iFund for mobile Internet apps and services.
A report available from Market Research Media (‘Global Cloud Computing Market Forecast 2015-2020’ – deep pockets required, as it will cost you $6,000), suggests that the global cloud computing market is expected to grow at a 30 per cent CAGR reaching $270 billion in 2020. According to Murphy:
“Companies’ comfort level and willingness to adopt the cloud is hitting an acceleration point. Now’s the most interesting time in the last 10 years to be investing in enterprise-based companies.”
Bloomberg reveals that Kleiner Perkins invested around $100 million into 10 cloud start-up companies last year. As a result of the increasing interest from VCs, many cloud companies have been acquired recently, and others are considering IPOs as they look to pay back their early-stage VC backers.
A report in January from CB Insights suggested that cloud companies represented over a quarter of all VC web investment deals. Its ‘2011 Venture Capital Report’ showed that Internet-based companies received $10.5 billion in a total of 1,185 deals during 2011. Speaking to the GigaOm site, CB Insights Co-Founder Jonathan Sherry said
“Over the course of 2011, we’ve seen a steady uptick of venture investment into cloud-based software and services. In Q4, cloud-based companies comprised 26.5 per cent of Internet deal volume and 34.5 per cent of Internet investment dollars.”
please sign in to rate this article