If you’re looking for tips on how to become one of the planet’s most successful venture capitalists, the new memoir by legendary VC Tom Perkins will surely disappoint. The founder of the firm that seeded Genentech and Google provides scant advice on how to scout the next blockbuster.
If, on the other hand, you’d like to read about what it’s like to be ridiculously rich, travel the world in extravagant yachts and rare automobiles, marry an eccentric celebrity romance novelist, and serve on the scandal-plagued board of Hewlett-Packard, then Perkins’ Valley Boy: The Education of Tom Perkins is for you. The book is set for release on Nov. 1.
Over the course of a non-chronologically organized 273 pages, the Kleiner Perkins Caufield & Byer co-founder rambles in a mostly cheery tone over some of the more extraordinary excerpts of his wealth-amassing life. The result is an entertaining peek into the peculiar world of one of Silicon Valley’s old guard.
The story begins with the most recent headline-grabber: Hewlett Packard’s wiretapping of board members to ferret out a media leak. Perkins casts himself as an innocent, unaware of the investigation and quick to resign his HP board seat after finding out. Nonetheless, he seems to be still miffed at former chair Patricia Dunn, both for her board oversight and her failure to appreciate his first stab at literature, the novel Sex & the Single Zillionaire.
“As far as I can determine, Pattie has absolutely no sense of humor,” he writes. “The book is silent on the finer points of corporate governance, so she probably found it dull and a waste of time.”
The tome jumps next to a retelling of a yacht-racing accident off the coast of France in which a French physician dies following a collision with Perkins’ boat. Perkins, his yacht captain, the skipper of the doctor’s boat, and the committee chair for the race are later found guilty of manslaughter in a trial so farcical, the author maintains, that even he lost interest in the proceedings. The final punishment: a $10,000 fine.
Other parts of Valley Boy are more straightforward autobiography. Perkins tells of his childhood as an only child and self-described nerd who grows up in the Depression-scarred 1940s. He attends MIT on partial scholarship, fixes radar-controlled gun sights in Turkey to get out of debt and graduates from Harvard Business School. After that comes a stint at HP, a turn at a failed startup, and the founding and sale of his first successful entrepreneurial venture, a laser company.
Perkins spends no more than two chapters on his namesake firm, starting with a scene about him and Eugene Kleiner on a Midwest fund-raising trip. “I always drove on these journeys, because being a passenger with Gene was too nerve-wracking for me; he tended to drift off the road while conversing.”
Lest you think KP has never made a mistake, Perkins notes that three of the firm’s initial investments were flops—such as Tread-Two, which re-soled tennis shoes, and Snow-Job, which converted motorcycles into snowmobiles.
He also recounts how KP’s first fund was “nearly wiped out” in an incident he says “it has taken me over 30 years to confess.” Perkins and Kleiner made the mistake of drawing down the full $8 million in LP commitments for their first fund, and rather than let the un-invested capital stagnate in a bank account, they handed $1 million to a man who arbitraged bond spreads in the public market. The arbitrageur had promised to hedge all their positions, but when Perkins did some checking he found that “our guru had put Gene and I into a naked, totally exposed position of tens of millions of dollars!” They got their money back, but only after Perkins “threatened the arbitrager with horrible, terrible physical mayhem if he didn’t immediately make full restitution.”
In succeeding chapters, Perkins describes what he does with much of the money he made. Among other things, he amasses a classic car collection, buys Led Zeppelin guitarist Jimmy Page’s English country manor (and has it exorcized), and commissions the championship racing yacht The Maltese Falcon.
Perkins’ style ranges from the boastful (“The yacht was a stunning success—a stupendous breakthrough. I had gambled, and I won!”) to the self-deprecating (“I have been characterized as being able to radiate tension just by walking into a room; this is among the kinder things said about my personality.”).
One gets the feeling Perkins wants to be self critical but just can’t find enough to criticize.
Excerpts from Valley Boy
On his partnership with Eugene Kleiner
“I have been characterized as being able to radiate tension by just walking into a room; this is among the kinder things said about my personality. Gene, on the other hand, was soothing and calm, portly but elegant in demeanor with a cultivated manner of speech.”
On investment bankers
“At the end of the world, after the sharks have gone, the investment bankers will out-survive the cockroaches.”
On being an HP GM
“My horizontal support among my peers, the GMs, was beyond terrible—they hated my guts. Even four decades later, when the prospect of my joining the HP board first emerged, some of them came out of retirement to lobby against the idea.”
On former HP Chairman Patricia Dunn
“Backing Pattie [as chairman] was an error on my part. Dunn, normally as quiet as a mouse with, I thought, a mouse’s unprepossessing personality, had a will of iron. Her vision, I soon discovered, bore little or no relationship to my own.”
On HP’s surveillance of its directors
“I was amazed! ‘How can this be legal?’ I asked. [Patricia Dunn] said that it was all quite legal, as long as the content was not transcribed—an assertion I immediately doubted.”
I arrived late in my parents’ lives, and they let me know that, all things considered, it would have been better if I hadn’t been born. … [My father’s] teaching technique was to call me ‘sissy’ when I flinched at the basketball when he bounced it on my head or when I ‘swung the bat like a girl,’ missing his fast pitches. He gave up on me early.”
On his optimism
“Every time I haven written a check, I have felt utterly confident of winning. Then when I lose, it somehow gets buried in a different part of my brain, and doesn’t get in the way of the next check.”
Source: Valley Boy: The Education of Tom Perkins, Gotham Books, 2007