Exclusive-Kleiner Perkins partner Wen Hsieh to launch TSMC-backed new fund -sources By Reuters

By Krystal Hu and Jane Lanhee Lee

(Reuters) -Longtime Kleiner Perkins partner Wen Hsieh is leaving the Silicon Valley venture capital establishment to start a fund with backing from the firm and Taiwanese chipmaker TSMC, sources told Reuters.

Hsieh is in advanced talks to raise $200 million from limited partners including Kleiner Perkins and TSMC for the new fund called Matter Ventures.

A Kleiner Perkins spokesperson confirmed Hsieh’s departure and the firm’s participation in the fund. TSMC did not respond to a request for comment.

Kleiner Perkins’s Haomiao Huang is also leaving the firm to join Hsieh in the new fund, which will focus on early stage hard-tech startups in the United States, including in artificial intelligence and robotics with real-world applications, the sources added.

Hsieh, with two PhDs from the California Institute of Technology, has worked at Kleiner Perkins for 17 years, leading investments in Chinese drone maker DJI and 3D printing company Desktop Medal. He will remain on the boards of companies he invested in at Kleiner Perkins, including orthodontic brackets maker LightForce.

Other notable Kleiner Perkins alums who have started their own funds include Vinod Khosla, founder of Khosla Ventures, and Mary Meeker, who launched BOND Capital.

A storied Silicon Valley name, Kleiner Perkins has been going through a generational transition since its longtime leader John Doerr moved into the chairman role in 2016. Mamoon Hamid and Ilya Fushman, two relatively recent additions to the firm’s general partners ranks, have taken the helm and led investments in startups including Figma and Rippling.

First-time fund managers are facing a challenging time raising funds as the Federal Reserve continues raising interest rates to tame inflation, and investors recalculate their exposure to venture capital.

U.S. venture capital firms raised $11.7 billion across 99 funds in the first quarter, plummeting from $73.8 billion raised by 199 funds a year ago, according to PitchBook data.

TSMC, based in Hsinchu, Taiwan, is expanding its U.S. footprint with a $40 billion investment in its chip plant in Arizona, which will start production in 2024.