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Khosla Ventures hits market with next flagship fund

Khosla Ventures is back in the market targeting about $1 billion for its Fund V, according to three limited partners with knowledge of the fundraising.

It’s not clear exactly when the fund hit the market, or even if Khosla Ventures has yet published a private placement memorandum. The target amount could not be officially confirmed as Khosla Ventures did not return a call for comment Monday.

The firm closed Khosla Ventures IV in 2011 with $1.05 billion. That fund charged a 2 percent management fee and a 30 percent carried interest rate, according to an investment summary from the New Jersey Division of Investment, an LP in the fund. Fund IV was generating a 1.08x total value multiple as of March, according to performance information from New Jersey.

The firm raised its first institutional fund, called Khosla Ventures Fund III, in 2009 with $1 billion in commitments. The firm also collected $300 million for a seed-stage investment fund, according to a press release from 2011. Fund III was producing a 15.3 percent internal rate of return and a 1.5x multiple as of Sept. 30, according to performance information from the California Public Employees’ Retirement System. The seed fund was generating a 9.5 percent IRR and a 1.2x multiple as of September, according to CalPERS.
Khosla’s first two funds used Vinod Khosla’s personal capital and were not open to outside investors, according to New Jersey.

The firm has a huge portfolio of investments. In May, Khosla joined Bill Gates, KLP Enterprises and oil-and-gas group Total in investing $35 million in Series C funding in Ambri, a provider of energy storage technology. Khosla in April invested in app developer The Hunt, joining previous investor Javelin Ventures to boost the company’s Series B funding to $10 million. Khosla has also invested in Square, Jawbone and Indiegogo.

Khosla Ventures was founded in 2004 by Vinod Khosla, co-founder of Sun Microsystems and a former general partner at Kleiner Perkins Caufield & Byers, to invest in “technology processes of the future,” according to a statement.

Last year, Shirish Sathaye, one of Khosla’s general partners, left the firm, according to a report in Fortune from November.

PhotoVinod Khosla, founder of Khosla Ventures, speaks during the Fortune Brainstorm Green conference in Dana Point, California April 13, 2010.   Reuters/Mario Anzuoni