Kleiner-Backed Terralliance Begins To Implode
Kleiner Perkins is on the verge of having a massive crater in its energy portfolio, but it has nothing to do with cleantech. Instead, the trouble involves Terralliance, a stealthy oil and gas exploration company that quietly raised $295 million in equity funding from KP and others. peHUB has learned that Terralliance has fired its founding CEO, laid off around 80% of its workers, closed offices and is desperately trying to renegotiate a massive debt-load. If it can't get the last piece done, then Terralliance might itself become a fossil fuel. "It's all about restructuring the debt, but the lender doesn't seem too eager to bail out the equity guys," says a source familiar with the situation. " feeling is, hey, the product works." That product is software that Terralliance says makes it easier and cheaper to locate oil and gas. The company then uses the software to do its own exploration, rather than simply selling it to third parties. Here is how Terralliance explained it, in a draft private placement memorandum dated April 2007:
