Low Risk Bets For Long Term Profits Executive' title='Low Risk Bets For Long Term Profits Executive' />Learning about risk from an academic is like learning about flying from an airport ice cream vendor.Nassim Nicolo Taleb.Milton Friedmans book.AAPL-bull-call-spread-trade-execution-cost.png' alt='Low Risk Bets For Long Term Profits Executive' title='Low Risk Bets For Long Term Profits Executive' />Vinod Khosla Keeps Long Term Bet on Clean Technology.Vinod Khosla crowed about the clean energy industry last year.Three of the biofuel start ups in his venture capital portfolio had just gone public, and the stocks had risen considerably after their debuts.I challenge anybody to claim that clean tech done right is a disaster, Mr.Khosla said at a conference, rebuffing recent criticism.Weve generated more profits there than anybody has.Since then, Mr. Khosla, the founder of Khosla Ventures, has watched much of those paper gains evaporate.As the clean energy industry broadly has taken a hit, shares of the biofuel companies Amyris, Gevo and Ki.OR have slumped 7.His stakes, once worth as much as 1.The billionaire investor has been caught in the cyclical downdraft.The public stocks of solar, wind and biofuel companies are suffering amid industrywide pressures.The price of natural gas remains low.Europe has pulled back on incentives.American subsidies are in question after the bankruptcy of the solar panel maker Solyndra.And China is providing formidable low cost competition.The whole clean tech sector has been out of favor, said Pavel Molchanov, an analyst at Raymond James Associates, a brokerage firm.Id be hard pressed to name one trading above its I.P. O. price. Despite the crosscurrents, Mr.Khosla seems unwavering in his commitment.He is pouring money into start ups.Khosla Ventures recently invested more in Light.Low Risk Bets For Long Term Profits Executive' title='Low Risk Bets For Long Term Profits Executive' />Sail Energy, a three year old start up working to develop low cost energy storage.He is also sticking with his public companies.His firm, for example, still owns 5.Ki. OR. Hes a visionary who likes to make big bets on ideas that can really change the world, said Andy Bechtolsheim, who co founded Sun Microsystems with Mr.Khosla 3. 0 years ago and shares a house with him at Big Sur on the California coast.I would think hes made a larger personal bet on green tech than anybody else.While the public markets are raising short term doubts, the long term investment thinking remains unchanged.Governments around the globe are pushing to find alternative sources of energy in an effort to reduce their dependence on fossil fuels that may hurt the environment.In a television interview in 2.Mr. Khosla said mainstream solutions could replace up to 8.Without them, he said, this planet is history the way we know it today.After Hurricane Sandy, the subject of global warming and changing climate conditions has again come to the forefront.In a recent blog post on the Forbes Web site, Mr.Khosla acknowledged the shift in market sentiment.Clean tech went through a time when it was in vogue and now it is not, he wrote.The financing environment for clean tech companies is tough today, he added.But he said he still expected to do better than industry averages by keeping our losing companies to a minority.Since founding his venture capital firm in 2.Mr. Khosla has become one of the most vocal advocates for clean tech innovation, buying stakes in about 6.Ausra, a solar thermal start up that had drawn 1.French nuclear plant builder Areva for about 2.And Sea. Micro, a low power server maker, was bought this year by Advanced Micro Devices for 3.Sea. Micro co founder, Andrew Feldman.Its unclear how the broader clean tech portfolio has performed at Khosla Ventures.Mr. Khosla declined to disclose the firms returns or to comment for the article.But one of his funds, which raised 1 billion to invest in clean tech and other start ups, shows gain of 3.California Public Employees Retirement System, the largest state pension fund.In his Forbes blog post, Mr.Khosla said a recent fund, which raised 1.October 2. 01. 1, was oversubscribed, and his firms broader performance since 2.In that period, venture funds over all have returned 7.Mr. Khoslas commitment is an outgrowth of his three decades at the cutting edge of technology.A native of India, Mr.Khosla, 5. 7, earned a masters degree in biomedical engineering from Carnegie Mellon and an M.B. A. from Stanford in 1.After starting the design automation company Daisy Systems in 1.Sun Microsystems, then a growing technology company.At Sun, he supplied drive and vision.But Mr. Khosla, who is known for his blunt talk and intense manner, was replaced as chief executive two years later and left the company shortly thereafter.In 1. 98. 6, he joined the venture capital firm Kleiner Perkins Caufield Byers.Over the next two decades, Mr.Khosla scored sizable returns betting on the growth of fiber optic networks.Two companies, Cerent and Siara Systems, were sold for a combined 1.Mr. Khosla was looking into alternative fuel technologies at Kleiner Perkins when a business plan for an ethanol start up crossed his desk in 2.The plan sat on a corner of my desk for nearly 1.I read everything I could about petroleum and its alternatives, he wrote in an article for Wired magazine in 2.When he branched out on his own in 2.Mr. Khosla invested millions in the ethanol start up, Celunol.He soon established himself as a top venture capitalist in clean tech, attracting prominent outside investors like Microsofts founder, Bill Gates.Former Prime Minister Tony Blair of Britain joined the firm as a senior adviser.Over the years, Mr.Khosla has experienced his share of blowups.In September 2. 01.Khosla backed Range Fuels, a wood chips to ethanol company, went bankrupt after receiving a 4.Department of Energy and 3.Department of Agriculture loan guarantee.When The Wall Street Journal editorial page criticized Range Fuels as an exercise in corporate welfare, Mr.Khosla lashed back, saying the authors inhabited an ivory tower that was full of people who dont understand technology.Sometimes, Mr. Khoslas companies had to pivot from their original plans and focus on new markets.For example, Calera was founded in 2.Mr. Khosla called its technology game changing in 2.But the company encountered some setbacks.It postponed plans for commercial scale production in 2.Since then, Calera has broadened its focus, developing other products like fillers for paper and plastics.Like many venture capital investors, Mr.Khosla will risk a few strikeouts for the chance to hit home runs.My willingness to fail is what gives me the ability to succeed, the investor has said frequently.The odds can be especially brutal in clean technology.The projects are often capital intensive like 2.Sam Shelton, a research engineer at Georgia Institute of Technology.By comparison, social media start ups often require little upfront money and few employees.The economics are totally different, Mr.Shelton said. In part, Mr.Khosla aims to take stakes when the companies are still getting off the ground, rather than waiting until theyre more mature and more expensive.He first bought a stake in Ki.OR, which aims to convert wood chips to gas and diesel fuel, in 2.The company is now completing the first of five planned plants in Mississippi with the help of a 7.Mr. Khosla is always thinking at a very high level about the potential of an idea, Ki.ORs chief executive, Fred Cannon, said. Order And Chaos Online Cracked Apk Forum . He has a very good feel for when to step on the gas.After jumping in early, Mr.Khosla appears willing to ride out the swings, in both directions.Over the years, public filings indicate he has plowed roughly 8.Ki. OR, amassing a 5.Although the stock is off its peak levels and I.P. O. investors are still underwater, his holdings are worth 3.Correction November 3.An earlier version of this article mischaracterized Mr.Khoslas return on his investment in Ki.OR. 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