5 ms·

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 experienc

by 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.

by dharmon 10y ago

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.