Web 2.0, Kleiner Perkins, and Wal-Mart

One of the web-related stories of the month so far is the apparent loss of interest in Web 2.0 on the part of Kleiner Perkins and other VC firms. Silicon Valley Watcher quotes a KP partner as saying: We have absolutely no interest in funding Web 2.0 companies.

Another story of the month is the success of the Everex Green PC at Wal-Mart (it’s still sold out at walmart.com as I write this). Glyn Moody emphasized two things about the gPC. Each is, not surprisingly, related to the fact that the gOS operating system is Linux-based.

One, of course is the price, which would be impossible with Microsoft Windows. The second is the way the manufacturer is trying to create a machine whose software is based around Web apps. One important aspect of this approach is that it decouples user software from the underlying operating system. So the fact that this machine is running GNU/Linux is almost at the level of what BIOS it uses.

To rephrase the second point: the web as platform is basic to the gPC. It’s also basic to Web 2.0. In fact, it is the first of the principles that Tim O’Reilly used to answer the question: What Is Web 2.0?

So it seems as though KP is leaving Web 2.0 just as Web 2.0 is arriving at Wal-Mart – and leaving just as quickly in the hands of customers. This is where I pull the alternate endings trick. Which of the following punchlines do you prefer?

  • KP’s timing is lousy: the market for Web 2.0 applications is getting bigger, thanks to the world’s largest retailer.
  • KP’s timing is good: it’s no accident that Silicon Valley is a long way from Bentonville, Arkansas.
  • Perhaps KP is just fed up with the term Web 2.0.
  • A big lumbering venturesaurus like KP isn’t right for Web 2.0 startups anyway. Such startups are better served by a firm like Y Combinator.