Who Will Be the Green VC Giant?

For nearly two decades, John Doerr and Vinod Khosla worked together at Kleiner Perkins Caufield & Byers, forging one of the most lucrative partnerships in the venture capital business. The gravel-voiced Doerr scored the high-profile hits, including Netscape Communications, Amazon.com (AMZN), and Google (GOOG), while the confrontational Khosla backed little-known communications equipment startups such as Juniper Networks (JNPR) and Cerent (CSCO), with similarly explosive returns.

Now the former colleagues are competing to fund the most promising startups in clean technology, a potentially lucrative but risky field many believe could lead to Silicon Valley's next boom. Doerr, still at Kleiner, helped shift his firm's focus from information technology to green investments a few years ago, with help from partner Bill Joy, former chief scientist at Sun Microsystems. Khosla, who left Kleiner five years back, just raised $1.1 billion from partners and institutional investors, giving his Khosla Ventures the heft to compete for the most capital-intensive deals. "These guys are in a race" for the most important green deals, says Paul Deninger, vice-chairman at investment bank Jefferies & Co. (JEF)