8 ms·

Marc Andreessen – Lessons, Predictions, and Recommendations [audio]

89 points by jackgavigan 10y ago

dharmon 10y ago
I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. His "twitter schools" parrot things like Buffett's shareholder letters pretty closely ("When the tide goes out, we find out who's been swimming naked."), so at least at an intellectual level he gets it, but his investment behavior contrasts this strongly, where he seems willing to pay any price for growth. Unfortunately this is common in the investment world, where everyone is a value investor in words, but rarely in behavior. I guess I am mostly interested to see how the "founder as rockstar" thesis that is central to a16z works in practice.
- w1ntermute 10y ago
  > I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. And the only reason they've been able to reach $4B in AUM so quickly is because record-low interest rates and stagnating growth in the developing world have created a rush of capital to Silicon Valley looking for any semblance of alpha. The real question we should be asking is what sector of the economy all this roving capital will target next, when it becomes clear that tech startups can't live up to the promises of the VCs. > I guess I am mostly interested to see how the "founder as rockstar" thesis that is central to a16z works in practice. That's just a sales message used to get gullible and desperate founders to take money from them without giving it a second thought. When things go south, like they did for Zenefits (YC W13), a16z won't be so nice anymore: > On Feb. 1, Zenefits held an emergency board meeting. The licensing problems and the macro were discussed. [a16z partner] Dalgaard suggested to Conrad that, as the person who created the program, he needed to leave.[0] 0: http://www.bloomberg.com/features/2016-zenefits/ http://www.bloomberg.com/features/2016-zenefits/
  - mathattack 10y ago
    That's a little more than things going Southz. That's fraud.
    - w1ntermute 10y ago
      I'm talking about might, not right. Half of Wall Street was committing fraud in the years leading up to the financial crisis, and it was a hell of a lot worse than anything Conrad did. How many of them have been held accountable the way he was? From that perspective, who are the real "rockstars"?
      - te0x 10y ago
        Yeah but no one is using Wall St as a benchmark for accountability. You're going to call them out for ousting a founder that encouraged fraud?
        w1ntermute 10y ago
        No, I'm calling them out for falsely marketing themselves as pro-founder.
        tasteup 10y ago
        Pro-founder does not mean they drop all standards and expectations. I'm not familiar with their entire portfolio, but using the Zenefits case (where the founder is accused of fraud) is a poor argument to support your claim that they are not pro-founder. I'm not saying they are or aren't profounder. I just think Zenefits is not a good example to use to make sweeping accusations about the firm.
        mathattack 10y ago
        You can be pro-founder and still toss frauds out of office. This is a spectrum and a16z appears to be more founder friendly than 90s era VCs who were more likely to be ex-bankers and quicker to replace founders.
- paulpauper 10y ago
  here is a list of some of them https://en.wikipedia.org/wiki/Andreessen_Horowitz https://en.wikipedia.org/wiki/Andreessen_Horowitz Facebook, Twitter, Skype, AirBNB are why it's so valuable. All you need are a few huge winners. The ones since 2012 don't seem so great though. Maybe too soon to tell
- _pius 10y ago
  I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. They returned their first fund twice over ... in three years. http://fortune.com/2012/07/24/nice-ira-andreessen-horowitz-returns-first-fund-twice-over/ http://fortune.com/2012/07/24/nice-ira-andreessen-horowitz-r...
  - foobarqux 10y ago
    I think mostly from the Skype deal, which was once in a lifetime.
    - tedmiston 10y ago
      "This is the power law distribution in practice." http://blakemasters.com/post/21869934240/peter-thiels-cs183-startup-class-7-notes-essay http://blakemasters.com/post/21869934240/peter-thiels-cs183-...
      - foobarqux 10y ago
        No, the Skype deal was very idiosyncratic: Andreessen was on the eBay board and no-shopped the Skype spinout to himself. That isn't going to happen again.
    - nl 10y ago
      Their second fund had Nicra ($1.26B), Instagram ($1B) and others. Not sure if the GroupOn and Zynga IPOs were first or second fund. Either way, that fund was a big success.
      - foobarqux 10y ago
        You may be right, but it's not enough to look at the names; a16z were buying badges at the outset.
- deleted 10y ago
  [deleted]
- g_delgado14 10y ago
  Marc Andreessen explicitly states in this podcast that he's not a value investor. He goes on to explain his actual investment thesis in it as well.
  - dharmon 10y ago
    The link was originally just talking about bubbles. It was swapped out with a link to the podcast, so I haven't listened to it.
tommynicholas 10y ago
THAT ISN'T WHAT A BUBBLE IS DAMN IT!
- otl1248 10y ago
  That's exactly what a bubble would say in this situation.
  - tommynicholas 10y ago
    Damn you got me
kirubakaran 10y ago
If we're in a bubble, the opposite of what is listed in the article will be happening: investments will be increasing, VC backed companies will be splurging more etc. It is amazing that they'd list a bunch things that support the position that there isn't a bubble and draw the conclusion that there is one! It is sunny and hot out and people are walking around in shorts in Seattle, clearly this means it is winter because people would click on an article about winter. Who knows if we are actually in a "bubble" or not, but if anything we have to reach the opposite conclusion from the facts listed in the article.
sheepleherd 10y ago
Marc Andreessen is a bubble, or a couple of them. The guy was a programmer (no insult, so was I) who wrote, while young and enthusiastic, a derivative copy of well known software idea... he got rich, good for him (no sour grapes, so did I) but that hardly makes him a genius of business savvy and economics. His name and commentaries started popping up everywhere a few short years ago which to me smells strongly of having a PR agency (insult+sour grapes, I don't have one) So, when I say Marc Andreessen is a bubble, I mean his money came from a bubble, and his portfolio has expanded in a bubble, and so has his apparent influence, but I don't myself see evidence of extra-technical genius or being able to see the future. I have no problem with his living the dream; and if you're living the dream, it wouldn't even be surprising if you fell in love with sniffing your own farts (sour, not grapes!) that's human nature. What I have a problem with is, why is everybody else always hanging on his every word, what is notable in what he purportedly says?
- paulpauper 10y ago
  he's batting 1000 in life..not bad for someone who wrote a 'derivative copy of well known software idea'. Everything he has done has worked out perfectly, which reflects some luck but also genuine skill at understanding markets, trends, etc. Timed the Netscape exit perfectly got into the best start-ups early
  - jpeg_hero 10y ago
    ..and he married a billionaire heiress (no sour grapes!). If this whole "VC thing" doesn't work out for him, he can always be a kept man ;)
  - geofft 10y ago
    > he's batting 1000 in life ... got into the best start-ups early I don't think this is factually true. Besides Netscape, he's noted for cofounding Ning and Loudcloud. Loudcloud pivoted almost entirely, sold their old business, and rebranded the new idea as Opsware which had a successful exit (but even so wouldn't be "the best"). Ning I'd grant being successful in the sense of not having died, but I don't think there's any argument that it's anywhere near "the best". It feels like a huge stretch to count that as three-for-three.
paulpauper 10y ago
misleading title. what Andresssen said had nothing to do with valuations . so tired of click bait
- dang 10y ago
  No kidding. And blogspam to boot. Normally we'd change the URL to the original (http://fourhourworkweek.com/2016/05/29/marc-andreessen/ http://fourhourworkweek.com/2016/05/29/marc-andreessen/), but that's audio content, which HN users tend not to prefer, so there's a tradeoff here.
TDL 10y ago
My belief why many people are calling this cycle a bubble is because they experienced two big bubbles almost back to back. I think much of the bubble calling over the past few years reeks of recency bias and people have been burned, not just once, but twice. I have no idea if we are in a bubble or not, I'm sure some segments in tech are bubbles. I think focusing too much on whether or not we are in a bubble is a distraction of doing the work in front of us, whatever that work may be. Don't get distracted by the hype of bulls or the bears.
elgabogringo 10y ago
Are we in a "bubble" or just the latter stage of a business cycle? A lot of it depends on the definition you use for "bubble." Regardless of your definition, it doesn't matter much one way or another. Central bank policies have been ridiculous the last 8 years. Nobody should be surprised there are market distortions - and nobody should pretend there aren't.
dang 10y ago
Url changed from http://qz.com/699191/marc-andreessen-isnt-admitting-theres-a-tech-bubble-but-hes-coming-pretty-close/ http://qz.com/699191/marc-andreessen-isnt-admitting-theres-a..., which transcribes a few quotes from this and sticks a clickbait maraschino on top. Normally we wouldn't change from a text article to an audio piece that has no transcript, since the latter is much less accessible. But it feels wrong to reward the above behavior.
jgalt212 10y ago
The worst thing about VC's is their herd-like behaviour. You work hard to get your biz funded and as soon as the valley gets wind of your funding, all the other VC's immediately fund X other copy-cat businesses (almost seemingly without regard to viability of the original business model). And given a16z's huge reliance on PR, I'd argue that if they funded your biz, you'd then have even more copy-cat funded competition than if you went with a more low-key VC.

89 points by jackgavigan 10y ago

I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. His "twitter schools" parrot things like Buffett's shareholder letters pretty closely ("When the tide goes out, we find out who's been swimming naked."), so at least at an intellectual level he gets it, but his investment behavior contrasts this strongly, where he seems willing to pay any price for growth. Unfortunately this is common in the investment world, where everyone is a value investor in words, but rarely in behavior. I guess I am mostly interested to see how the "founder as rockstar" thesis that is central to a16z works in practice.

w1ntermute 10y ago
> I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. And the only reason they've been able to reach $4B in AUM so quickly is because record-low interest rates and stagnating growth in the developing world have created a rush of capital to Silicon Valley looking for any semblance of alpha. The real question we should be asking is what sector of the economy all this roving capital will target next, when it becomes clear that tech startups can't live up to the promises of the VCs. > I guess I am mostly interested to see how the "founder as rockstar" thesis that is central to a16z works in practice. That's just a sales message used to get gullible and desperate founders to take money from them without giving it a second thought. When things go south, like they did for Zenefits (YC W13), a16z won't be so nice anymore: > On Feb. 1, Zenefits held an emergency board meeting. The licensing problems and the macro were discussed. [a16z partner] Dalgaard suggested to Conrad that, as the person who created the program, he needed to leave.[0] 0: http://www.bloomberg.com/features/2016-zenefits/ http://www.bloomberg.com/features/2016-zenefits/
- mathattack 10y ago
  That's a little more than things going Southz. That's fraud.
  - w1ntermute 10y ago
    I'm talking about might, not right. Half of Wall Street was committing fraud in the years leading up to the financial crisis, and it was a hell of a lot worse than anything Conrad did. How many of them have been held accountable the way he was? From that perspective, who are the real "rockstars"?
    - te0x 10y ago
      Yeah but no one is using Wall St as a benchmark for accountability. You're going to call them out for ousting a founder that encouraged fraud?
      - w1ntermute 10y ago
        No, I'm calling them out for falsely marketing themselves as pro-founder.
        tasteup 10y ago
        Pro-founder does not mean they drop all standards and expectations. I'm not familiar with their entire portfolio, but using the Zenefits case (where the founder is accused of fraud) is a poor argument to support your claim that they are not pro-founder. I'm not saying they are or aren't profounder. I just think Zenefits is not a good example to use to make sweeping accusations about the firm.
        mathattack 10y ago
        You can be pro-founder and still toss frauds out of office. This is a spectrum and a16z appears to be more founder friendly than 90s era VCs who were more likely to be ex-bankers and quicker to replace founders.
paulpauper 10y ago
here is a list of some of them https://en.wikipedia.org/wiki/Andreessen_Horowitz https://en.wikipedia.org/wiki/Andreessen_Horowitz Facebook, Twitter, Skype, AirBNB are why it's so valuable. All you need are a few huge winners. The ones since 2012 don't seem so great though. Maybe too soon to tell
_pius 10y ago
I am curious to see how a16z's investment results eventually pan out. I don't believe any of their funds have gone through a full cycle, nor have they experienced a down market, so its still too early to declare him a top dawg. They returned their first fund twice over ... in three years. http://fortune.com/2012/07/24/nice-ira-andreessen-horowitz-returns-first-fund-twice-over/ http://fortune.com/2012/07/24/nice-ira-andreessen-horowitz-r...
- foobarqux 10y ago
  I think mostly from the Skype deal, which was once in a lifetime.
  - tedmiston 10y ago
    "This is the power law distribution in practice." http://blakemasters.com/post/21869934240/peter-thiels-cs183-startup-class-7-notes-essay http://blakemasters.com/post/21869934240/peter-thiels-cs183-...
    - foobarqux 10y ago
      No, the Skype deal was very idiosyncratic: Andreessen was on the eBay board and no-shopped the Skype spinout to himself. That isn't going to happen again.
  - nl 10y ago
    Their second fund had Nicra ($1.26B), Instagram ($1B) and others. Not sure if the GroupOn and Zynga IPOs were first or second fund. Either way, that fund was a big success.
    - foobarqux 10y ago
      You may be right, but it's not enough to look at the names; a16z were buying badges at the outset.
deleted 10y ago
[deleted]
g_delgado14 10y ago
Marc Andreessen explicitly states in this podcast that he's not a value investor. He goes on to explain his actual investment thesis in it as well.
- dharmon 10y ago
  The link was originally just talking about bubbles. It was swapped out with a link to the podcast, so I haven't listened to it.

tommynicholas 10y ago

THAT ISN'T WHAT A BUBBLE IS DAMN IT!

otl1248 10y ago
That's exactly what a bubble would say in this situation.
- tommynicholas 10y ago
  Damn you got me

kirubakaran 10y ago

If we're in a bubble, the opposite of what is listed in the article will be happening: investments will be increasing, VC backed companies will be splurging more etc. It is amazing that they'd list a bunch things that support the position that there isn't a bubble and draw the conclusion that there is one! It is sunny and hot out and people are walking around in shorts in Seattle, clearly this means it is winter because people would click on an article about winter. Who knows if we are actually in a "bubble" or not, but if anything we have to reach the opposite conclusion from the facts listed in the article.

sheepleherd 10y ago

Marc Andreessen is a bubble, or a couple of them. The guy was a programmer (no insult, so was I) who wrote, while young and enthusiastic, a derivative copy of well known software idea... he got rich, good for him (no sour grapes, so did I) but that hardly makes him a genius of business savvy and economics. His name and commentaries started popping up everywhere a few short years ago which to me smells strongly of having a PR agency (insult+sour grapes, I don't have one) So, when I say Marc Andreessen is a bubble, I mean his money came from a bubble, and his portfolio has expanded in a bubble, and so has his apparent influence, but I don't myself see evidence of extra-technical genius or being able to see the future. I have no problem with his living the dream; and if you're living the dream, it wouldn't even be surprising if you fell in love with sniffing your own farts (sour, not grapes!) that's human nature. What I have a problem with is, why is everybody else always hanging on his every word, what is notable in what he purportedly says?

paulpauper 10y ago
he's batting 1000 in life..not bad for someone who wrote a 'derivative copy of well known software idea'. Everything he has done has worked out perfectly, which reflects some luck but also genuine skill at understanding markets, trends, etc. Timed the Netscape exit perfectly got into the best start-ups early
- jpeg_hero 10y ago
  ..and he married a billionaire heiress (no sour grapes!). If this whole "VC thing" doesn't work out for him, he can always be a kept man ;)
- geofft 10y ago
  > he's batting 1000 in life ... got into the best start-ups early I don't think this is factually true. Besides Netscape, he's noted for cofounding Ning and Loudcloud. Loudcloud pivoted almost entirely, sold their old business, and rebranded the new idea as Opsware which had a successful exit (but even so wouldn't be "the best"). Ning I'd grant being successful in the sense of not having died, but I don't think there's any argument that it's anywhere near "the best". It feels like a huge stretch to count that as three-for-three.

paulpauper 10y ago

misleading title. what Andresssen said had nothing to do with valuations . so tired of click bait

dang 10y ago
No kidding. And blogspam to boot. Normally we'd change the URL to the original (http://fourhourworkweek.com/2016/05/29/marc-andreessen/ http://fourhourworkweek.com/2016/05/29/marc-andreessen/), but that's audio content, which HN users tend not to prefer, so there's a tradeoff here.

TDL 10y ago

My belief why many people are calling this cycle a bubble is because they experienced two big bubbles almost back to back. I think much of the bubble calling over the past few years reeks of recency bias and people have been burned, not just once, but twice. I have no idea if we are in a bubble or not, I'm sure some segments in tech are bubbles. I think focusing too much on whether or not we are in a bubble is a distraction of doing the work in front of us, whatever that work may be. Don't get distracted by the hype of bulls or the bears.

elgabogringo 10y ago

Are we in a "bubble" or just the latter stage of a business cycle? A lot of it depends on the definition you use for "bubble." Regardless of your definition, it doesn't matter much one way or another. Central bank policies have been ridiculous the last 8 years. Nobody should be surprised there are market distortions - and nobody should pretend there aren't.

dang 10y ago

Url changed from http://qz.com/699191/marc-andreessen-isnt-admitting-theres-a-tech-bubble-but-hes-coming-pretty-close/ http://qz.com/699191/marc-andreessen-isnt-admitting-theres-a..., which transcribes a few quotes from this and sticks a clickbait maraschino on top. Normally we wouldn't change from a text article to an audio piece that has no transcript, since the latter is much less accessible. But it feels wrong to reward the above behavior.

jgalt212 10y ago

The worst thing about VC's is their herd-like behaviour. You work hard to get your biz funded and as soon as the valley gets wind of your funding, all the other VC's immediately fund X other copy-cat businesses (almost seemingly without regard to viability of the original business model). And given a16z's huge reliance on PR, I'd argue that if they funded your biz, you'd then have even more copy-cat funded competition than if you went with a more low-key VC.