Why Morgan Stanley's Meeker is moving to Silicon Valley

Photo credit: Morgan Stanley

by Patricia Sellers

When Internet analyst Mary Meeker announced at Morgan Stanley's Monday morning meeting today that she's leaving to become a venture capitalist at Kleiner Perkins Caufield & Byers, most people were surprised.

But to those who know Meeker, the so-called Queen of the 'Net since the late '90s, her move from Wall Street to Silicon Valley is a long time coming.

I mentioned this "rumor" (will Meeker leave Morgan Stanley to go to VC firm like Kleiner?) as far back as 1999, when Internet stocks boomed the first time and she was No. 3 on the Fortune Most Powerful Women list. Meeker was 40 then and helping companies like Netscape, and later Intuit (INTU) and Google (GOOG), go public.

Now Meeker is 51. And she swears that her career switch, after 19 years at Morgan Stanley (MS), is not so much due to mid-life self-analysis as much as Kleiner Perkins partners approaching her in late September at a CEO offsite in Spanish Bay, California.

"They swarmed me," Meeker told me this afternoon.

Juliet de Baubigny, one of the Kleiner partners who was a key recruiter, confirms that the swarming occurred. Over the years, de Baubigny says, she and Kleiner partner John Doerr have suggested to Meeker "in a light-hearted way" the idea of her joining the firm. But they got serious only recently as mobile/social/global media -- a focus of Meeker's research -- have converged to create so-called Web 3.0, the third wave of the web.

And so, for the past two months, Meeker, whom Fortune recently named one of the Smartest People in Tech, has been analyzing the pros and cons of uprooting her New York life and moving 3,000 miles west. In the process, she says, "The thing I started to appreciate is that I'm actually a proactive thinker, but on Wall Street I live in a reactive world."

What Meeker means is that everyday, throughout her career as a Wall Street analyst, she's worried how global crises -- North Korea, Ireland, whatever tomorrow brings -- will impact the stock market and the tech stocks she covers. Not that VC investing is insulated from real-world chaos (or reputational damage, which she suffered and survived when the first Internet bubble burst). But this new gig may give Meeker a calmer day-to-day existence, she admits -- as well as lucrative returns beyond the millions she's made on Wall Street.

Meeker owns a home in Silicon Valley and keeps a car there -- a BMW that is, she says, at least 15 years old.

Maybe an upgrade is in order.

The real question: Will Meeker be able to adapt her mindset to spot earlier-stage investments than the ready-to-IPO businesses she's used to analyzing? "I'll be testing my skills," she admits, adding that over the past two decades, "I've looked at 1000s of business plans for private companies."

"We've always said that Mary can see around corners," adds Morgan Stanley Chief Financial Officer Ruth Porat, a onetime investment banker who worked with Meeker on lots of tech deals. Now comes Meeker's biggest opportunity to prove herself.

P.S. Tomorrow evening, I'm interviewing Yahoo (YHOO) CEO Carol Bartz at a Fortune Most Powerful Women dinner in Silicon Valley. What should I ask Bartz? Click here if you would like to watch it live on Tuesday at 8 p.m. PST.

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