9 ms·

How Andreessen Horowitz Is Disrupting Silicon Valley

98 points by pkallberg 12y ago

ojbyrne 12y ago
That made me ill. I'm sure a16z is great and all, but there wasn't even a hint of criticism there. They couldn't find one slightly pejorative anecdote to contrast with the endless amount of fawning? I had to double check the byline, because by the end of it, I was convinced it had to be written by Robin Leach. Champagne wishes...
- thegenius 12y ago
  I agree. It's also worrisome that Marc Andreessen predicts the future so much lately. The future simply can't be predicted with such reliability as his certainty implies.
  - zbravo 12y ago
    Strong opinions, weakly held. http://blog.codinghorror.com/strong-opinions-weakly-held/ http://blog.codinghorror.com/strong-opinions-weakly-held/
- foobarqux 12y ago
  Criticism is bad for journalists unless it is done against recognized enemies.
nrao123 12y ago
AH is doing some remarkable stuff. 1) Like any great knowledge based firm - which strives to differentiate over and above its people - they have invested in tools. While the inspiration maybe CAA, firms like Mckinsey (knowledge management system) and Goldman (SecDB / Slang on the trading side and a detailed CRM system for the banking side) used the software / infra layer to develop a sustainable advantage which did not just depend on hiring the "smartest people" I.e. if people quit Goldman / Mckinsey - suddenly they were not able to outperform. On wall street - they call it seat value (how much value are you adding versus the seat/organization) 2) As a complete outsider - one can still easily see how the CRM software + sales connectors capability translates to $$$ for portfolio companies. For e.g. Box's recent deal with GE. 3) Therefore, on the enterprise side , if AH acts like a sales force (led by Mark Cranney) - then how does an enterprise company that is not backed by AH compete? In other words, over and above the prestige factor of being backed by a top tier VC firm- will NOT raising money from AH in the enterprise side put you at a disadvantage? 4) How much of this sales force / business development muscle applies to the consumer side? AH partners have referred to consumer startups as fruit fly experiments and will invest with a strong offer post-traction/ series B? But is there value in the consumer side as well in BD deals like how Moritz/Doerr helped Google power yahoo search and collect valuable search engine user behavior which was used to refine and test thier algorithms. 5) The article did mention in passing about recruiting support. But - I have read about a detailed software + people capability on talent hiring. 6) So, if sales + recruiting + strategy/advise are three value adds by VC firms (not counting money!) - does AH have a lock on 2 of the three?
- jeffreyrogers 12y ago
  Right, but the real question is: what are their returns? (And: how do they compare to VC as a whole?, how do they compare to long-term US treasury bonds?, how do they compare to the S&P 500?
  - jgalt212 12y ago
    Amen to that. What these guys do best, or seem to focus most of their energies on is PR. If they're so great, please show us some returns vis a your competitors and other asset classed with similar risk profiles.
  - ironchef 12y ago
    Don't have the most recent numbers but 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... It would seem they've done quite well.
    - foobarqux 12y ago
      Besides the fact that Skype was an exceptional insider deal these numbers can be misleading ("twice over" for a 10 year fund is about 7% a year and IRRs are distorted when money is returned early because you are not getting that return for the remaining period of investment).
      - pbreit 12y ago
        But insider deals are a key part of venture.
        foobarqux 12y ago
        The point is a Skype-type no-shop deal is unlikely to be replicated.
      - IanCal 12y ago
        Also, if we're looking at the 2009 onwards, the S&P500 has returned an average of 18%, a 2.28x return. (2009 - 2013 figures from here: http://en.wikipedia.org/wiki/S%26P_500#Total_annual_returns http://en.wikipedia.org/wiki/S%26P_500#Total_annual_returns)
johan_larson 12y ago
What would be the (software) VC equivalent of contrarian investing? Let's see, we could invest in companies that - are tackling problems for which solutions already exist - are staffed by experienced people, not youth - use mature technology - have nothing to do with the web or even the internet - are run outside of the valley (bonus points for flyover country) Surely there must be other things that warm the heart of the contrarian investor?
- thegenius 12y ago
  This resonates so strongly with me, and I'm so glad you posted it. It reinforces the framework I've been using myself for the past few years and perfectly articulates what I've been trying to explain to myself even. I can add even one more I personally follow. The standard way most tech companies put capital to work is hiring or aqui-hiring tech talent. My own experience tells me that's too risky since I've worked with far, far more overvalued people than undervalued. Therefore, I reinvest the profits of my tech business into companies that have steady and real return on equity (e.g. Wells Fargo). Imagine that: A tech company that invests all retained earnings in a boring bank! :)
- pbreit 12y ago
  I don't think the geography is the best parameter. Think of it this way: if something was contrarian in all other aspects, would you prefer it in the Valley or outside? Can you say that about other parameters?
  - johan_larson 12y ago
    Contrarian investors try to do what most investors don't. Don't most VCs invest primarily in companies that are nearby, meaning Silicon Valley proper and maybe the larger peninsula? Which means a contrarian would invest outside it. Maybe way outside it. Like Kansas.
    - pbreit 12y ago
      Well, I was just trying to explain why that might not need to be the case. You can be contrarian and focus on the Bay Area. And that in fact might be smarter.
jmduke 12y ago
I'll be honest -- my first impression after reading this piece was to research Peter Sims and figure out his connection to a16z, since my gut reaction was that blatant puff pieces usually have some sort of connection hidden below the surface. (I was unable to find anything.) Sims brings up the following point about VC returns: > The predominant old way of thinking about venture capital is that you: a) build up a great brand and reputation with a large portfolio of investments, b) hire partners who have individually strong brands of their own, and c) collect hefty management fees on each fund. The industry standard is a 2–2.5% yearly “management” fee, a figure that gets pretty large on a billion dollar fund. And, in my experience, not surprisingly, the senior people get a disproportionate slice of that management fee. At the same time, the venture capital industry has been a glaringly poor-performing asset management group, consistently underperforming the S&P 500. (For more detail on the struggles within the VC industry, a recent article on the Harvard Business Review Blog by Diane Mulcahy, a senior fellow at the Kauffman Foundation, entitled “Venture Capitalists Get Paid Well to Lose Money” is well worth reading). But never swings back around to it (unless I missed it amongst the flowery prose). Which leads me to ask: are there data points that compares a16z (or other VC firms!) against the S&P 500, besides the aggregate?
- foobarqux 12y ago
  I would love these figures too but VC is notoriously secretive about their returns. There was a court case where Reuters sued Sequoia to get them to disclose their returns based on the fact that a big public-sector pension fund was one of their investors. Reuters lost. http://www.reuters.com/article/2013/12/20/us-funds-california-ucal-idUSBRE9BJ04I20131220 http://www.reuters.com/article/2013/12/20/us-funds-californi...
  - taurath 12y ago
    Oh k. Surely there can't be any sort of bubble or fraud there. What happens to the startups if the VCs fall?
- jeffreyrogers 12y ago
  I have data that compares other VC firms to the S&P 500. Give me a few minutes and I'll find it. Foreshadowing: it's pretty bad, you'd do much better putting your money in an index of the S&P 500.
capkutay 12y ago
Andreesen Horowitz became the apple of every startup founder's eye because they were the new guys who had success as investors while being friendly to startups I'd rather raise money from a guy who wears a 'No Bitchassness' [0] shirt who wants to pump up my valuation, help me recruit tech talent, and allow me to give equity to compensate my best people versus some stodgy old guy who thinks he's better than everyone because he invested in [insert successful company from the 90s/early 2000s]. Basically, they were the uber of VCs in terms of how they treated their portfolio companies. That said, I generally don't like media that praises investors because once we start glorifying the fund-raising process rather than bootstrapping and making money, we'll have tons of companies with too much money and no exit. Bubble burst. 0: http://www.jasonshen.com/wp-content/uploads/2012/10/benhorowitz-150x150.png http://www.jasonshen.com/wp-content/uploads/2012/10/benhorow...
idlewords 12y ago
It seems really odd to have such an powerful part of the Silicon Valley establishment accused of disrupting anything. Unless there's some aspect to their business model that differes from venture capital in the most traditional sense, and that I am missing.
ghshephard 12y ago
It was an interesting Editorial Decision to not use the preferred A16Z, but instead go with the (exactly same length) A.H. everywhere.
- cpwright 12y ago
  A.H. requires no explanation for those not in the know, A16Z does.
  - ghshephard 12y ago
    Right - but linking their company's abbreviation to the software development concept of I18N, would have been a great introductory paragraph, that picked up on the essential geekiness of Ben and Marc. It's
  - jschulenklopper 12y ago
    Well, their website is at http://a16z.com/ http://a16z.com/, so the explanation could have been short.
rattray 12y ago
I wasn't aware of all the great stuff AH is doing. It looks impressive. They're not the only VC firm innovating, though. First Round Capital, for example, also has a terrific recruiting division (I know this is common at other firms as well). FRC also created the Dorm Room Fund[0], which invests small amounts in student-run companies and gives them access to FRC resources. FRC has an internal "platform team", developing technology to enable knowledge sharing between portfolio firms. In short, they work hard and do new things to help entrepreneurs succeed. I'm speaking about First Round because I have direct experience with them, but I'm sure the same is true of some of the other VC's as well. [0] dormroomfund.com - disclaimer, my former startup received funding from them.
richmarr 12y ago
=~ s/Disrupting/Leading/
cyphunk 12y ago
Just a reminder, Andreessen is the same person that says Snowden is a traitor.
- easytiger 12y ago
  And from reading some books discussing Andreessen & his past ventures I wouldn't have thought he'd have considered Snowden anything other than a +ve force in the information world. Perhaps Andreessen has interests in companies that were hoping to help governments spy on their charges?
  - jeremyt 12y ago
    Or maybe he just happens to believe what he says? Maybe he believes that the sensitive information that Snowden released is damaging the security of the US? I personally think Snowden was a traitor. He released way more information than was necessary to accomplish his goal; The information he released has almost certainly put lives in jeopardy; AND he fled to Russia which is essentially a totalitarian state where his presence, if not aiding in a material way, is aiding Russia in a PR capacity. If you haven't noticed, Russia is turning out to be, if not a geopolitical foe, and outright enemy of the United States. Why have we got to jump to questioning people's motivations every time they stray from the party line? ...As if there is only one acceptable opinion to hold on everything. Sheesh
    - cyphunk 12y ago
      The only comment he made were to blame Snowden and brush off the massive surveillance and obstruction of civil liberties without a word. So rather than consider the problem that created Snowden he only blames the messenger. I can't think of a single character from the past year, be they pro or con, that commented on the topic in a more pathetic way.
Myrmornis 12y ago
I couldn't get more than a quarter of the way through. Is it all gushingly sycophantic?
skrebbel 12y ago
The word "disrupt" has become entirely meaningless, hasn't it?
- _random_ 12y ago
  I agree, just install this: https://chrome.google.com/webstore/detail/disrupt-to-bullshit/mahaemfhlcjficbbkbpmkbhhenfnikcf?hl=en https://chrome.google.com/webstore/detail/disrupt-to-bullshi...
michaelochurch 12y ago
Andreessen Horowitz has generated a positive reputation (in a field where most of its counterparts are ridiculous, incompetent assholes, so seeming strongly competent provides prominence) but here's a stark indicator for "wolf in sheep's clothing": http://a16z.com/2014/07/30/the-happy-demise-of-the-10x-engineer/ http://a16z.com/2014/07/30/the-happy-demise-of-the-10x-engin... . Read it. If you don't have a nose for rot, I'll point your way to it: Today, if you have a great idea for a software product, you need to either be an engineer or find one. Tomorrow, that billion-dollar startup acquisition might not need an engineer at all. I have no direct knowledge of A16Z, but admitting a desire to make software "a low-skill trade" is chewing our food for us. The moral conclusion is right there. They've actually admitted to being the bad guys, to wanting to commoditize top talent in favor of our MBA-culture colonizers. Most of the time, the bad guys don't say, "We're the bad guys". You actually have to do some research. You have to poke around the countryside and find the emaciated political prisoners and the mass graves to figure out who the bad guys are. Not here. The good news is that the Silicon Valley elite have such unprecedented arrogance that, often times, they'll actually admit what they are. They'll flat out say, "fuck you programmers, you had your turn." For those who aren't educated on the matter, the evil of Silicon Valley's last 20 years is that it has become an economy of resource extraction (like Saudi Arabia) instead of one that genuinely creates wealth. The difference is that, instead of said resource being oil or natural gas, it's the intelligence and energy of each generation of young people that hasn't figured out, yet, that the only people with a decent chance of getting rich in this Valley game are VCs and landlords (i.e. not them, the people doing the actual work).
- david927 12y ago
  You're right, of course. Developers still hold a lot more of the cards, and power, than investors would like. But you're also missing the irony here: when software foundations consolidate, so will everything else in software. Instead of a thousand crazy 'apps' like SnapChat, you'll have user-derived variations, fulfilling the long tail, leaving little need for VC and the silly valuations they inspire.
- markpundmann 12y ago
  Your acting just like the old factory worker who's pissed that his profession is starting to become more automated. Wake up and smell the coffee, developers are getting more productive and you have to adapt to the decreasing demand that this will cause. Programming is job in the labor market just like a fast food cooker. If you want to make some more money, either learn some skills that most other people do not have and that are needed (low supply, high demand), or start a company so that you can make some profits (which technically have no limit). BTW, I think you need to look at the salaries of some other professions. I'm gonna be making 6 figures out of college as an SDE, while most of my engineering and business friends are going to be making about half of that. Talk to non engineering/business majors (cough, communication majors, cough) and the pay gets even worse.
Havoc 12y ago
It strikes me as ironic that he would pick Twitter to convey >140 char essays.
- oroup 12y ago
  Especially as a board member of Facebook.

98 points by pkallberg 12y ago

That made me ill. I'm sure a16z is great and all, but there wasn't even a hint of criticism there. They couldn't find one slightly pejorative anecdote to contrast with the endless amount of fawning? I had to double check the byline, because by the end of it, I was convinced it had to be written by Robin Leach. Champagne wishes...

thegenius 12y ago
I agree. It's also worrisome that Marc Andreessen predicts the future so much lately. The future simply can't be predicted with such reliability as his certainty implies.
- zbravo 12y ago
  Strong opinions, weakly held. http://blog.codinghorror.com/strong-opinions-weakly-held/ http://blog.codinghorror.com/strong-opinions-weakly-held/
foobarqux 12y ago
Criticism is bad for journalists unless it is done against recognized enemies.

nrao123 12y ago

AH is doing some remarkable stuff. 1) Like any great knowledge based firm - which strives to differentiate over and above its people - they have invested in tools. While the inspiration maybe CAA, firms like Mckinsey (knowledge management system) and Goldman (SecDB / Slang on the trading side and a detailed CRM system for the banking side) used the software / infra layer to develop a sustainable advantage which did not just depend on hiring the "smartest people" I.e. if people quit Goldman / Mckinsey - suddenly they were not able to outperform. On wall street - they call it seat value (how much value are you adding versus the seat/organization) 2) As a complete outsider - one can still easily see how the CRM software + sales connectors capability translates to $$$ for portfolio companies. For e.g. Box's recent deal with GE. 3) Therefore, on the enterprise side , if AH acts like a sales force (led by Mark Cranney) - then how does an enterprise company that is not backed by AH compete? In other words, over and above the prestige factor of being backed by a top tier VC firm- will NOT raising money from AH in the enterprise side put you at a disadvantage? 4) How much of this sales force / business development muscle applies to the consumer side? AH partners have referred to consumer startups as fruit fly experiments and will invest with a strong offer post-traction/ series B? But is there value in the consumer side as well in BD deals like how Moritz/Doerr helped Google power yahoo search and collect valuable search engine user behavior which was used to refine and test thier algorithms. 5) The article did mention in passing about recruiting support. But - I have read about a detailed software + people capability on talent hiring. 6) So, if sales + recruiting + strategy/advise are three value adds by VC firms (not counting money!) - does AH have a lock on 2 of the three?

jeffreyrogers 12y ago
Right, but the real question is: what are their returns? (And: how do they compare to VC as a whole?, how do they compare to long-term US treasury bonds?, how do they compare to the S&P 500?
- jgalt212 12y ago
  Amen to that. What these guys do best, or seem to focus most of their energies on is PR. If they're so great, please show us some returns vis a your competitors and other asset classed with similar risk profiles.
- ironchef 12y ago
  Don't have the most recent numbers but 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... It would seem they've done quite well.
  - foobarqux 12y ago
    Besides the fact that Skype was an exceptional insider deal these numbers can be misleading ("twice over" for a 10 year fund is about 7% a year and IRRs are distorted when money is returned early because you are not getting that return for the remaining period of investment).
    - pbreit 12y ago
      But insider deals are a key part of venture.
      - foobarqux 12y ago
        The point is a Skype-type no-shop deal is unlikely to be replicated.
    - IanCal 12y ago
      Also, if we're looking at the 2009 onwards, the S&P500 has returned an average of 18%, a 2.28x return. (2009 - 2013 figures from here: http://en.wikipedia.org/wiki/S%26P_500#Total_annual_returns http://en.wikipedia.org/wiki/S%26P_500#Total_annual_returns)

johan_larson 12y ago

What would be the (software) VC equivalent of contrarian investing? Let's see, we could invest in companies that - are tackling problems for which solutions already exist - are staffed by experienced people, not youth - use mature technology - have nothing to do with the web or even the internet - are run outside of the valley (bonus points for flyover country) Surely there must be other things that warm the heart of the contrarian investor?

thegenius 12y ago
This resonates so strongly with me, and I'm so glad you posted it. It reinforces the framework I've been using myself for the past few years and perfectly articulates what I've been trying to explain to myself even. I can add even one more I personally follow. The standard way most tech companies put capital to work is hiring or aqui-hiring tech talent. My own experience tells me that's too risky since I've worked with far, far more overvalued people than undervalued. Therefore, I reinvest the profits of my tech business into companies that have steady and real return on equity (e.g. Wells Fargo). Imagine that: A tech company that invests all retained earnings in a boring bank! :)
pbreit 12y ago
I don't think the geography is the best parameter. Think of it this way: if something was contrarian in all other aspects, would you prefer it in the Valley or outside? Can you say that about other parameters?
- johan_larson 12y ago
  Contrarian investors try to do what most investors don't. Don't most VCs invest primarily in companies that are nearby, meaning Silicon Valley proper and maybe the larger peninsula? Which means a contrarian would invest outside it. Maybe way outside it. Like Kansas.
  - pbreit 12y ago
    Well, I was just trying to explain why that might not need to be the case. You can be contrarian and focus on the Bay Area. And that in fact might be smarter.

jmduke 12y ago

I'll be honest -- my first impression after reading this piece was to research Peter Sims and figure out his connection to a16z, since my gut reaction was that blatant puff pieces usually have some sort of connection hidden below the surface. (I was unable to find anything.) Sims brings up the following point about VC returns: > The predominant old way of thinking about venture capital is that you: a) build up a great brand and reputation with a large portfolio of investments, b) hire partners who have individually strong brands of their own, and c) collect hefty management fees on each fund. The industry standard is a 2–2.5% yearly “management” fee, a figure that gets pretty large on a billion dollar fund. And, in my experience, not surprisingly, the senior people get a disproportionate slice of that management fee. At the same time, the venture capital industry has been a glaringly poor-performing asset management group, consistently underperforming the S&P 500. (For more detail on the struggles within the VC industry, a recent article on the Harvard Business Review Blog by Diane Mulcahy, a senior fellow at the Kauffman Foundation, entitled “Venture Capitalists Get Paid Well to Lose Money” is well worth reading). But never swings back around to it (unless I missed it amongst the flowery prose). Which leads me to ask: are there data points that compares a16z (or other VC firms!) against the S&P 500, besides the aggregate?

foobarqux 12y ago
I would love these figures too but VC is notoriously secretive about their returns. There was a court case where Reuters sued Sequoia to get them to disclose their returns based on the fact that a big public-sector pension fund was one of their investors. Reuters lost. http://www.reuters.com/article/2013/12/20/us-funds-california-ucal-idUSBRE9BJ04I20131220 http://www.reuters.com/article/2013/12/20/us-funds-californi...
- taurath 12y ago
  Oh k. Surely there can't be any sort of bubble or fraud there. What happens to the startups if the VCs fall?
jeffreyrogers 12y ago
I have data that compares other VC firms to the S&P 500. Give me a few minutes and I'll find it. Foreshadowing: it's pretty bad, you'd do much better putting your money in an index of the S&P 500.

capkutay 12y ago

Andreesen Horowitz became the apple of every startup founder's eye because they were the new guys who had success as investors while being friendly to startups I'd rather raise money from a guy who wears a 'No Bitchassness' [0] shirt who wants to pump up my valuation, help me recruit tech talent, and allow me to give equity to compensate my best people versus some stodgy old guy who thinks he's better than everyone because he invested in [insert successful company from the 90s/early 2000s]. Basically, they were the uber of VCs in terms of how they treated their portfolio companies. That said, I generally don't like media that praises investors because once we start glorifying the fund-raising process rather than bootstrapping and making money, we'll have tons of companies with too much money and no exit. Bubble burst. 0: http://www.jasonshen.com/wp-content/uploads/2012/10/benhorowitz-150x150.png http://www.jasonshen.com/wp-content/uploads/2012/10/benhorow...

idlewords 12y ago

It seems really odd to have such an powerful part of the Silicon Valley establishment accused of disrupting anything. Unless there's some aspect to their business model that differes from venture capital in the most traditional sense, and that I am missing.

ghshephard 12y ago

It was an interesting Editorial Decision to not use the preferred A16Z, but instead go with the (exactly same length) A.H. everywhere.

cpwright 12y ago
A.H. requires no explanation for those not in the know, A16Z does.
- ghshephard 12y ago
  Right - but linking their company's abbreviation to the software development concept of I18N, would have been a great introductory paragraph, that picked up on the essential geekiness of Ben and Marc. It's
- jschulenklopper 12y ago
  Well, their website is at http://a16z.com/ http://a16z.com/, so the explanation could have been short.

rattray 12y ago

I wasn't aware of all the great stuff AH is doing. It looks impressive. They're not the only VC firm innovating, though. First Round Capital, for example, also has a terrific recruiting division (I know this is common at other firms as well). FRC also created the Dorm Room Fund[0], which invests small amounts in student-run companies and gives them access to FRC resources. FRC has an internal "platform team", developing technology to enable knowledge sharing between portfolio firms. In short, they work hard and do new things to help entrepreneurs succeed. I'm speaking about First Round because I have direct experience with them, but I'm sure the same is true of some of the other VC's as well. [0] dormroomfund.com - disclaimer, my former startup received funding from them.

richmarr 12y ago

=~ s/Disrupting/Leading/

cyphunk 12y ago

Just a reminder, Andreessen is the same person that says Snowden is a traitor.

easytiger 12y ago
And from reading some books discussing Andreessen & his past ventures I wouldn't have thought he'd have considered Snowden anything other than a +ve force in the information world. Perhaps Andreessen has interests in companies that were hoping to help governments spy on their charges?
- jeremyt 12y ago
  Or maybe he just happens to believe what he says? Maybe he believes that the sensitive information that Snowden released is damaging the security of the US? I personally think Snowden was a traitor. He released way more information than was necessary to accomplish his goal; The information he released has almost certainly put lives in jeopardy; AND he fled to Russia which is essentially a totalitarian state where his presence, if not aiding in a material way, is aiding Russia in a PR capacity. If you haven't noticed, Russia is turning out to be, if not a geopolitical foe, and outright enemy of the United States. Why have we got to jump to questioning people's motivations every time they stray from the party line? ...As if there is only one acceptable opinion to hold on everything. Sheesh
  - cyphunk 12y ago
    The only comment he made were to blame Snowden and brush off the massive surveillance and obstruction of civil liberties without a word. So rather than consider the problem that created Snowden he only blames the messenger. I can't think of a single character from the past year, be they pro or con, that commented on the topic in a more pathetic way.

Myrmornis 12y ago

I couldn't get more than a quarter of the way through. Is it all gushingly sycophantic?

skrebbel 12y ago

The word "disrupt" has become entirely meaningless, hasn't it?

_random_ 12y ago
I agree, just install this: https://chrome.google.com/webstore/detail/disrupt-to-bullshit/mahaemfhlcjficbbkbpmkbhhenfnikcf?hl=en https://chrome.google.com/webstore/detail/disrupt-to-bullshi...

michaelochurch 12y ago

Andreessen Horowitz has generated a positive reputation (in a field where most of its counterparts are ridiculous, incompetent assholes, so seeming strongly competent provides prominence) but here's a stark indicator for "wolf in sheep's clothing": http://a16z.com/2014/07/30/the-happy-demise-of-the-10x-engineer/ http://a16z.com/2014/07/30/the-happy-demise-of-the-10x-engin... . Read it. If you don't have a nose for rot, I'll point your way to it: Today, if you have a great idea for a software product, you need to either be an engineer or find one. Tomorrow, that billion-dollar startup acquisition might not need an engineer at all. I have no direct knowledge of A16Z, but admitting a desire to make software "a low-skill trade" is chewing our food for us. The moral conclusion is right there. They've actually admitted to being the bad guys, to wanting to commoditize top talent in favor of our MBA-culture colonizers. Most of the time, the bad guys don't say, "We're the bad guys". You actually have to do some research. You have to poke around the countryside and find the emaciated political prisoners and the mass graves to figure out who the bad guys are. Not here. The good news is that the Silicon Valley elite have such unprecedented arrogance that, often times, they'll actually admit what they are. They'll flat out say, "fuck you programmers, you had your turn." For those who aren't educated on the matter, the evil of Silicon Valley's last 20 years is that it has become an economy of resource extraction (like Saudi Arabia) instead of one that genuinely creates wealth. The difference is that, instead of said resource being oil or natural gas, it's the intelligence and energy of each generation of young people that hasn't figured out, yet, that the only people with a decent chance of getting rich in this Valley game are VCs and landlords (i.e. not them, the people doing the actual work).

david927 12y ago
You're right, of course. Developers still hold a lot more of the cards, and power, than investors would like. But you're also missing the irony here: when software foundations consolidate, so will everything else in software. Instead of a thousand crazy 'apps' like SnapChat, you'll have user-derived variations, fulfilling the long tail, leaving little need for VC and the silly valuations they inspire.
markpundmann 12y ago
Your acting just like the old factory worker who's pissed that his profession is starting to become more automated. Wake up and smell the coffee, developers are getting more productive and you have to adapt to the decreasing demand that this will cause. Programming is job in the labor market just like a fast food cooker. If you want to make some more money, either learn some skills that most other people do not have and that are needed (low supply, high demand), or start a company so that you can make some profits (which technically have no limit). BTW, I think you need to look at the salaries of some other professions. I'm gonna be making 6 figures out of college as an SDE, while most of my engineering and business friends are going to be making about half of that. Talk to non engineering/business majors (cough, communication majors, cough) and the pay gets even worse.

Havoc 12y ago

It strikes me as ironic that he would pick Twitter to convey >140 char essays.

oroup 12y ago
Especially as a board member of Facebook.