Andreessen talks with Swisher on Re/code Decode about bubbles, politics and parenting.
When I first came out here [Silicon Valley] I thought that I had missed all the excitement. I thought that the PC had happened and I thought that was it, and I thought that we were just going to play cleanup after the PC. And then the internet supernova happened and this new universe has opened up. For me that was a big shock. The opportunities for this industry are just so much bigger than they used to be. We see kids coming here in their early 20s and every now and then they’ll say ‘Boy, I wish I was here in the old days when everything was happening’ and I think they’re all going to be sitting in these chairs 20 years from now, saying the same thing, ‘Oh it was so crude an primitive back then’.
Andreessen and Andreessen Horowitz are profiled in an article in the New Yorker titled, Tomorrow’s Advance Man.
Entrepreneurs want to raise money from us, so the natural thing when we say ‘What if you did this?’ is to tell us what we want to hear. But we don’t want to hear what we want to hear. It’s a delight when they look at you with contempt—You idiot—and then walk you through the idea maze and explain why your idea won’t work. At the same time, we’re not funding Mother Teresa. We’re funding imperial, will-to-power people who want to crush their competition. Companies can only have a big impact on the world if they get big…Deal flow is everything. If you’re in a second-tier firm, you never get a chance at that great company.
Breakthrough ideas look crazy, nuts. It’s hard to think this way—I see it in other people’s body language, and I can feel it in my own, where I sometimes feel like I don’t even care if it’s going to work, I can’t take more change. O.K., Google, O.K., Twitter—but Airbnb? People staying in each other’s houses without there being a lot of axe murders?
Chris Dixon argues that we’re in the magical-products business—that we fool ourselves into thinking we’re building companies, but it doesn’t matter if we don’t have the magical products. Over twenty years, our returns are going to come down to two or three or four investments, and the rest of this [gestures at the building and staff] is the cost of getting the chance at those investments. There’s a sense in which all of this is math—you just don’t know which Tuesday Mark Zuckerberg is going to walk in.
Altman interviews Andreesen, Conway and Parker in the ninth How to Start a Startup lecture, How to Raise Money, at Stanford University.
In a wide-ranging and detailed interview with New York magazine, Andreessen talks about Silcon Valley culture, discrimination, his favorite TV shoe (Deadwood), and the ideal of meritocracy:
I believe the ideal is compromised by two things right now: One is educational skills development, and the other is access. This is the critique that I think is actually the most interesting, which is, yeah, the meritocracy works if you know the right people, if you have access to the networks. How do venture capitalists make investment decisions? Well, we get referrals based on people we already know. Well, what if you’re somebody who doesn’t already know anybody, right? What if you don’t know the recruiter at Facebook so you can’t get the job? What if you don’t know the venture capitalist so you can’t raise funding? We think access is broadening out the network so that everybody who could contribute can get access to the network. And that’s the one that we’re working on.
Andreessen warns startups that if they spend money too fast, they can’t rely on a buyer to solve their problems:
When market turns, M&A mostly stops. Nobody will want to buy your cash-incinerating startup. There will be no Plan B. VAPORIZE.
TechCrunch reports that Twitter asked investors to keep the numbers quiet. It doesn’t state where it obtained the figures for funding and pre-money valuation, beyond hinting that an investor may have leaked them.
In response to the revelation that Facebook attempted to manipulate user moods, Andreessen tweets:
Andreessen says that this type of testing helps improve websites.
In an interview on Vox, Andreessen claims that laws such as Sarbanes-Oxley and Regulation Fair Disclosure are placing such burdens on successful startups that they are wating longer to go public, depriving the public markets of growth.
The compliance and reporting requirements are extremely burdensome for a small company. It requires fleets of lawyers and accountants who come in and do years of work. It’s this idea that if you control everything down to the nth detail, nothing will go wrong
The loop we’re in now is that people are getting upset and disappointed by the stock market. There are no growth stocks, which means there’s no growth. Stock market returns have been flat for 15 years, which is exactly what you’d expect if you took all the growth out. Everyone is upset the stock market isn’t performing. The worse the results get, the more regulation you get. It’s in its own kind of doom loop. Unless something happens to shock the system a lot, our assumption is it gets worse, not better.
He also criticizes Tomas Piketty’s book, Capital, saying that the investment results that Piketty says drive inequality are exaggerated:
The funny thing about Piketty is that he has a lot more faith in returns on invested capital than any professional investor I’ve ever met. It’s actually very interesting about his book. This is exactly what you’d expect form a French socialist economist. He assumes it’s really easy to put money in the market for 40 years or 80 years or 100 years and have it compound at these amazing rates. He never explains how that’s supposed to happen.
Sources tell the Post that Andreessen is competing with Nasdaq to create the first regulated Bitcoin exchange. Andreessen has reportedly reached out to the NY Department of Financial Exchange for more information on the upcoming rules. Andreessen declines to comment on the reports.
The investment firm announces a $90 million investment in the enterprise management, that helps IT professionals secure and manage devices.
Andreessen says that he wants to remain inclusive on Twitter, but doesn’t apologize for his unique use of the platform.
I am a true believer…I think we have a fantastic story to tell out here. I don’t think the negative story should go unchallenged.
Andreessen says that the Yo app is a form of one-bit communication – a message with no content other than the fact that it exists, such as a police siren, flashing stop light or taxicab roof indicator. He notes that missed calls are another form of one-bit communication and in Bangladesh account for as much as 70% of mobile network traffic at any one time, used as a prearranged signal or code:
Andreessen publishes a column in Politico outlining a method for expanding “innovation clusters” beyond California’s tech industry:
…policymakers shouldn’t be trying to copy Silicon Valley. Instead, they should be figuring out what domain is (or could be) specific to their region—and then removing the regulatory hurdles for that particular domain. Because we don’t want 50 Silicon Valleys; we want 50 different variations of Silicon Valley, all unique from each other and all focusing on different domains.
Imagine a Bitcoin Valley, for instance, where some country fully legalizes cryptocurrencies for all financial functions. Or a Drone Valley, where a particular region removes all legal barriers to flying unmanned aerial vehicles locally. A Driverless Car Valley in a city that allows experimentation with different autonomous car designs, redesigned roadways and safety laws. A Stem Cell Valley. And so on.
Andreessen calls Snowden a traitor, a viewpoint he claims is a minority view in Silicon Valley:
For me obviously he’s a traitor. If you look up in the encyclopedia ‘traitor,’ there’s a picture of Ed Snowden. He stole national security secrets and gave them to everyone on the planet.
Andreessen also continuies his criticism of President Obams response to the NSA revelations, noting there is no plan to help American companies that do business overseas:
As far as I can tell there’s no plan, there’s no strategy, there’s no tactics, there’s nothing. The Snowden reveals keep coming out. The [Obama] administration is letting the NSA out to dry. They’re letting the American tech industry out to dry.
Andreeseen says the Obama administration is falling behind on global cyber competition. On the importance to the economy and national and national security of U.S. tech competitiveness in a ‘balkanized’ Internet:
It’s not actually a good thing if the American companies are not the dominant global tech companies, it wouldn’t be good for the intelligence agencies either […]Different countries, Russia, many others, [are] basically wanting to section off the internet and take a lot more control of it in their countries.
Andreessen says Bitcoin will be viewed as being as innovative as the Internet itself. Bitcoin, he says, is a classic example of a “disruptive technology” that changes a paradigm. He predicts that Bitcoin will become a multibillion-dollar industry, and will radically transform the world’s economies.
Bitcoin didn’t come from Citibank; it didn’t come from the Federal Reserve; it didn’t come from Visa. It came from the fringe. And now Bitcoin is in the early stages of mainstreaming today. And the signs that it’s in the early stages of mainstreaming are mainstream venture capital firms funding mainstream startups, employing mainstream engineers to build services that’ll be used by mainstream people. You’ve got big companies that are not yet doing a lot with it, but are looking very seriously at it…
I have a lot of friends who are programmers. The programmers have always gone like, “Those [Bitcoin] guys are crazy.” And then, almost 100 percent of the time, they sit down, read the paper, read the code — it takes them a couple weeks — and they come out the other side. And they’re like: “Oh my god, this is it. This is the big breakthrough. This is the thing we’ve been waiting for. He solved all the problems. Whoever he is should get the Nobel prize — he’s a genius. This is the thing! This is the distributed trust network that the Internet always needed and never had.”
The company announces Series F funding from its existing roster including SV Angel, Bessemer, Fidelity, Andreessen Horowitz, FirstMark Capital, and Valiant Capital Partners. Total financing is $764 million, and the company is working on building out its ad monetization system and its search functions.
Pinterest starts Promoted Pins to add revenue, appearing in users’ search and category feeds. The mix of brands reflects activity on the site. Fashion features heavily, with Gap, Banana Republic, Lululemon Athletica, and Old Navy participating. Food makers Nestle , Kraft, and General Mills are also participating, along with Expedia.com and Walt Disney resorts in the travel category.
Andreessen says he is warning portfolio companies to be skeptical of early-stage investments with high valuations as investors from outside Silicon Valley, who he doesn’t name, are acting unethically. He says they are often presenting term sheets as a start to negotiations rather than an end-point, and pushing valuations sky-high to get exclusivity on deals, increasing the risk for the startup if the investor walks, and making it harder for the investor to get future deals.
Andreessen restarts his Twitter account after avoiding the microblogging service for several years. Over the next few months he sends thousands of tweets including many multi-part streams about the tech industry’s role in the economy. He advocates free-market principles and says a social safety net should be established to support people who lose jobs due to disruption. He accumulates 125,000 followers:
Andreessen is honored with the inaugural Queen Elizabeth Prize for Engineering alongside other Internet pioneers, including Robert Kahn, Vinton Cerf, Louis Pouzin, and Tim Berners-Lee. The announcement is made at London’s Royal Academy of Engineering. In a blog post, Andreessen writes:
I am humbled and grateful to be a co-winner of the 2013 Queen Elizabeth Prize. Thank you to the judges, and congratulations to Robert, Vint, Louis, and Tim…I would first like to acknowledge my partner in creating Mosaic, Eric Bina. Eric co-wrote the original code for Mosaic with me — specifically all the difficult parts…I would also like to acknowledge Larry Smarr, Joe Hardin, and all of my colleagues at NCSA and the University of Illinois at the time…
He adds that he will donate the prize money to charitable programs that help spread the culture and foundational knowledge of engineering — such as scholarships and summer programs for engineering students.
The firm invests in Rap Genius, a site which provides annotated rap lyrics. The investment is announced in an annotated press release on the site by Andreesen which recognizes Horowitz’s love for the genre:
Given that Rap Genius is a web site where people explain rap lyrics, and given that my partner Ben is a noted rap fanatic, your first reaction might be, “That Horowitz guy has completely lost his mind.” I, on the other hand, find rap every bit as comprehensible as ancient Mesopotamian. That’s why I’m writing this blog post – not him.
The six partners of Andreessen Horowitz pledge half of their lifetime income to charity. As part of the announcement, the partners donate $1 million to six Silicon Valley nonprofits. Horowitz says:
The idea behind it is to lead by example. It’s a show of appreciation for everyone in Silicon Valley.
The move is highly influenced by Andreessen’s wife, Laura Arillaga-Andreessen who had publishes a philanthropy book, Giving 2.0, the year before.
Time names Andreessen one of the World’s Most Influential People:
Nearly two decades ago, Marc Andreessen co-created the first popular Web browser. Now he’s the man to see for Internet start-up funding. With partner Ben Horowitz, Andreessen, 40, has raised a $2.7 billion war chest, which he’s invested in major players (Facebook, Twitter) and rising stars (Pinterest, Instagram) in the platform he helped invent.
Andreessen is disclosed as having donated $50,000 to Restore Our Future, a super PAC supporting Mitt Romney.
Graham interviews Andreessen about Netscape and how the tech industry has changed. Andreessen:
All of us who were lucky enough to be involved back then were completely unaware of what was going to happen
CNET ranks Andreesen and Horowitz on its “entirely subjective” list of 2011’s most influential tech investors, focusing on the Skype sale:
My favorite Andreessen-Horowitz play of 2011 involves a little Internet payback. Andreessen and team sold Skype–which they’d bought control of with a group of investors in 2009–to Microsoft for $8.5 billion. Andreessen and his team more than tripled a $50 million investment in 18 months.s
Glam Media acquires Ning for approximately $200 million. As part of the sale, Andreessen joins Glam’s board of directors:
Glam Media is one of the most dynamic companies in the digital media space, and I am excited to help guide their further expansion.
Business Insider reports that among the investors in the fund are AOL, Conway, Milner, Benchmark Capital, Horowitz, Andreessen, Redpoint, and Sequoia.
Vanity Fair names Horowitz and Andreesen to its 2011 New Establishment list, which identifies those individuals making contributions as
The Age of Information gives way to a burgeoning Age of Technology.
Mark Zuckerberg takes the top spot.
Andreessen publishes an op-ed in the Wall Street Journal titled “Why Software Is Eating the World”:
More and more major businesses and industries are being run on software and delivered as online services—from movies to agriculture to national defense. Many of the winners are Silicon Valley-style entrepreneurial technology companies that are invading and overturning established industry structures. Over the next 10 years, I expect many more industries to be disrupted by software, with new world-beating Silicon Valley companies doing the disruption in more cases than not.
The social applications service shifts from offering free and paid services to premium-only options. CEO Rosenthal writes:
Our premium Ning networks like Friends or Enemies, Linkin Park, Shred or Die, Pickens Plan, and tens of thousands of others … drive 75 percent of our monthly U.S. traffic, and those network creators need and will pay for many more services and features from us.
Users who choose not to pay for services can migrate their data to other platforms, a feature previously touted by co-founder Andreessen.
Andreessen Horowitz and lawyer Ted Wang launch Series Seed Documents, templated documents which entrepreneurs can use for seed-stage deals. Andreessen Horowitz is the first to agree to use the documents. Andreessen says:
We want to make the process as transparent as possible, which is to say, we want to take all the mystery out it. And it is online for everyone to understand.
The documents are designed for early rounds between $500,000 and $1 million.
Andreessen Horowitz and other investors acquire a majority stake in the Internet communications client Skype for $2.75 billion, an investment many consider risky. Andreessen has called Skype one of the most important companies on the Internet. Two years later, Microsoft will acquire Skype for $8.5 billion.
Ebay sells Skype at a value of $2.75 billion to Silver Lake Partners, which includes Joltid, the Canada Pension Plan Investment Board, and Andreessen Horowitz. SLP acquires a 70 percent stake in the Internet communication company. Andreesen notes:
Skype is gigantic and yet still a relatively small percentage of international call volume. This is, and ought to be, one of the most important companies on the Internet.
Andreessen joins the HP board of directors. He is awarded an annual cash retainer of $100,000 or HP securities as well as an annual equity retainer of $150,000. HP Chairman/CEO Hurd says:
Marc Andreessen is a software pioneer whose leadership has helped shape the Internet. Marc’s entrepreneurial background and industry expertise will be a welcome addition to the HP board of directors.
Andreessen invests in the media company that operates the TalkingPointsMemo blog. With contributions from other angel investors, the round of financing is estimated between $500,000 and $1 million. TalkingPointsMemo is recognized as one of a small number of blogging sites that does original journalism.
Andreessen and Horowitz launch Andreessen Horowitz, a venture capital firm. The two are well known investors, backing half a dozen startups each year, including social investing site kaChing, virtual worlds company Metaplace, mobile video company Qik, online publishing company Crowdfusion, dating site I’minlikewithyou, search company Blekko and media/technology company EQAL.
Andreessen joins eBay’s board of directors while working on the Ning social networking platform. eBay President/CEO John Donahoe says:
Marc is a true visionary whose experience will be invaluable to eBay. We look forward to learning from Marc’s insights and expertise as we drive further innovation on our platform, invest in growth opportunities, and develop technology that will further benefit our customers, build powerful communities and enhance e-commerce.
After a period of speculation, Andreessen officially joins Facebook’s board of directors alongside Mark Zuckerberg, Jim Breyer, and Peter Thiel. The official press release calls Andreessen’s venture Ning, “a complementary platform to Facebook,” rather than a potential rival. Andressen says:
Facebook is one of the most innovative companies on the Web and it’s an honor to join the board. I’m looking forward to helping the team as Facebook continues to grow.
Andreesen and wife Laura pledge $27.5 million to Stanford Hospital & Clinics, marking their first philanthropic commitment as a couple. The money is pledged to upgrade emergency services and build the Marc and Laura Andreessen Emergency Department.
Both of us feel so strongly that, being part of the new generation in Silicon Valley, we have a responsibility to hopefully inspire other people in our age range to make significant philanthropic commitments.
Twitter announces a round led by Union Square Ventures and including Conway, Andreessen, and others. It doesn’t disclose the funding amount or valuation. Twitter:
Twitter has had such an awesome start and now we’re even more excited to keep up the momentum. We’re very much looking forward to building a strong and sustainable company.
Andreessen marries Laura Arrillaga, a philanthropy teacher at Stanford University and the daughter of Silicon Valley real estate developer John Arrillaga. The marriage spurs Andreessen to start considering new philanthropic options:
I am completely committed to philanthropy because if I’m not, I’m in a great deal of trouble. I can’t even tell you.
Andreessen and Bianchini launch Ning, a free online service where users can build social applications. The service is a product of Palo Alto startup 24 Hour Laundry. Developers can use Ning’s tools to build new programs or work off of clones of existing services.
The difference between apps built on Ning and any of these other services is that we make it easy for developers to build whatever app they want for any topic, interest, group, language, location or product, without a lot of effort. As a user, you get to explore and take advantage of this wider variety of social apps.
Andreessen introduces Conway and Adelson via email. Adelson meets Conway at his house:
I remember being really impressed with the questions he was asking. The other thing was Ron’s database in his brain of contacts around Silicon Valley was the most extensive and probably most top-of-mind database of people that I’ve ever run into in my career.
Andreessen announces the formation of Loudcloud, a company based in Menlo Park, California, that provides high-performance computing and software services to Internet and e-commerce companies. Loudcloud is later recognized as the first company to conceive of the “cloud” paradigm. Andreessen teams up with several ex-Netscape employees, including Loudcloud’s co-founder and CEO, Ben Horowitz. Andreessen is listed as the company’s co-founder and chairman. According to reports, Loudcloud is privately funded by Andreessen and other employees.
Andreessen is named to MIT Technology Review’s Innovators Under 35 list for his work with Netscape and America Online.
Ultimately, his greatest influence on the future of technology could be the outcome of the Justice Department’s antitrust suit against Microsoft, in large part the result of Bill Gates’ business practices vis-à-vis Andreessen’s Netscape.
Andreessen agrees to take a role as Chief Technology Officer at America Online. He will not oversee the company’s technical operations or Netscape’s software development. He talks about what AOL’s marketing efforts will bring to Netscape:
Technology without marketing is not very interesting–there are lots of examples of great technology and poor marketing. Programmers don’t have an affinity for marketing, but they love it when their products are popular. They really respect the results [marketers] are able to achieve.
AOL announces it is acquiring Netscape Communications Corp. for $4.2 billion. Andreessen is negotiating a position with the company after announcing a sabbatical. Netscape President/CEO Barksdale is joining AOL’s board of directors, but will not hold an operating role:
Netscape is doing this because it’s in the best interests of Netscape.
Andreessen receives the 1995 Computerworld Smithsonian Information Technology Leadership Award for Global Integration, sponsored by the Science Applications International Corp. Health Care Technology Group. He is included in the Smithsonian’s permanent research collection. David A. Cox, SAIC’s Health Care Technology Group senior vice president, says:
As SAIC continues to provide information technology solutions for health care information systems, Marc Andreessen has developed a key tool for accessing information within the medical community.