Have venture capitalists been ignoring infrastructure investments? A panel moderated by Paul Kedrosky says no way, it’s just not sexy to talk about. The panel features:

• Rajeev Batra, Pricipal, Mayfield
• Tom Dyal, Managing Director, Redpoint Ventures
• Maha Ibrahim, General Partner, Canaan Partners
• Allan Leinwand, Partner, Panorama Capital
• Vivek Mehra, General Partner, August Capital

Kedrosky: Is infrastructure on the outs for VC?

Panorama’s Leinwand: I would argue with the premise of the panel. VCs are funding infrastructure—when it’s right.

Kedrosky: What hits have you seen over the last few years?

Panorama’s Leinwand: Riverbed and Aruba.

August’s Vivek: Akimbi

Kedrosky: Has the idea of infrastructure changed?

Canaan’s Maha: Infrastructure now includes things like storage and communications — mobile and VoIP. It is a really exciting time to see investing. Five years ago many of these companies were buried in debt. We are actively investing in this, and it’s an exciting time to be investing. It’s just not sexy to talk about.

Mayfield’s Rajeev: Cleantech is fundamentally about infrastructure.

Redpoint’s Ted: We can all say we love infrastructure, but we’re not doing the deals we did years ago. A lot of the deals need specialized software.

Kedrosky: What infrastructure deals are dead?

August’s Vivek: Next generation infrastructure — too expensive. Network processing companies.

Canaan’s Maha: I would have said the same thing five years ago. We’re looking for things that are truly revolutionary, as opposed to anything someone with a checkbook can do.

Kedrosky: Then what is revolutionary?

Canaan’s Maha: A lot of stuff in mobile — 4G or else. On the networking side, virtualization.

Kedrosky: Other infrastructure deals you guys have missed?

Redpoint’s Tom: Riverbed caught everyone by surprise. The angle we didn’t see very clearly is, it’s not about compression its about accelerating. Also Data Domain. Core infrastructure deals have to be exceptional to be done.

August’s Vivek: Sometimes VCs lose their senses. When things look gloomy, no one wants to do an investment, but some of the best investments were done at the bottom. If you invest at the top you’re bound to be screwed.