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So the big wins claimed were all early in the first round: Instagram, Twitter, Skype, etc. They made about $100M off Skype, and probably comparable or less fro
by dharmon 10y ago
So the big wins claimed were all early in the first round: Instagram, Twitter, Skype, etc.
They made about $100M off Skype, and probably comparable or less from the others, but if they proceeded to raise $3B and invested it in companies like Jawbone, that completely kills their IRR. That's what I was getting at when I posed the question in the original thread. A few small wins do not undo many large losses.
It will take at least a full cycle to see. In another 5-10 years we can compare to the firms you mentioned. Obviously in the meantime a16z don't mind being compared to Sequoia et. al.
a16z charges 2 and 25. 2% of AUM each year, 25% of the profits. (2&20 is standard in hedge funds.)
- caseyallen 10y agoExcept you need to factor in a 30% carry, not 25%. This was stated in a 2015 New Yorker interview covering Marc and the firm. 2 and 30. Source: http://www.newyorker.com/magazine/2015/05/18/tomorrows-advance-man http://www.newyorker.com/magazine/2015/05/18/tomorrows-advan...
- ohazi 10y agoI thought it was 3 and 30 (which seemed pretty arrogant at the time). Have they backpedaled? https://erickschonfeld.com/2012/08/28/3-and-30/ https://erickschonfeld.com/2012/08/28/3-and-30/
- dharmon 10y agoOh wow. You're right. I remembered that it was higher than the usual, but not that much higher. Thanks.
- hkmurakami 10y agoYeah the problem is that their instagram investment made great returns on a small investment, which just didn't make a big enough impact on their overall returns.