Latest news with #BenHorowitz
Forbes
15-05-2025
- Business
- Forbes
The Metamorphosis: How VC Funds Are Evolving And Stepping Away From The Classic Model
Iconic sign for Sand Hill Road, with a green traffic light signaling "Go", on Sand Hill Road in the ... More Silicon Valley town of Menlo Park, California, August 25, 2016. In Silicon Valley culture, "Sand Hill Road" is used as a metonym for the venture capital industry, as many prominent venture capital firms have offices along the road. (Photo via Smith Collection/Gado/Getty Images). For decades, venture capital operated with a relatively straightforward playbook: find promising early-stage startups, invest modest sums across a portfolio of companies, and hope a few breakout successes would deliver outsized returns. But a quiet yet radical transformation is underway, with Lightspeed Venture Partners' recent move to become a Registered Investment Advisor (RIA) representing perhaps the most telling signal yet of venture capital's dramatic evolution. This seemingly technical regulatory change actually represents a profound shift in strategy and capability. By registering as an RIA, Lightspeed—one of Silicon Valley's most prominent venture firms—has effectively given itself permission to expand far beyond traditional venture investments. The firm can now purchase public stocks, execute private equity-style buyouts, build roll-up strategies, and dramatically scale its secondary market activities. This metamorphosis isn't happening in isolation. Several top-tier venture firms have been steadily expanding their scope and scale: Andreessen Horowitz (a16z) became an RIA back in 2019, a move that initially raised eyebrows but has since proven prescient. The firm has since participated in the Twitter deal alongside Elon Musk, built an expansive crypto empire spanning both investment and infrastructure, and launched a wealth management platform. Ben Horowitz even recently said in a recent interview "The classic VC model is dead." Sequoia Capital, long considered the gold standard in venture investing, has evolved toward an "evergreen" model designed to hold investments for much longer periods, moving away from traditional fund structures with fixed time horizons. Thrive Capital, founded by Josh Kushner, recently raised a specialized one billion dollar vehicle specifically designed to build and buy AI-native companies, blurring the lines between venture investing and company creation. Perhaps most dramatically, General Catalyst has pursued healthcare investments so aggressively that it acquired an entire hospital system—and has openly dropped the VC label in favor of describing itself as an 'investment company.' This transformation comes amid several converging factors creating both opportunity and necessity for leading venture firms: First, the traditional venture model is showing signs of strain. The "spray and pray" approach—making 25 early bets and hoping for two unicorns—no longer delivers the same reliable returns in a market where company-building costs have escalated and exit timelines have extended. Second, the explosion of secondary market activity has created significant new opportunities. As private companies stay private longer, providing liquidity to early investors and employees has become a massive business opportunity that traditional VC fund structures weren't designed to capture. Third, artificial intelligence is creating unprecedented opportunities to transform existing businesses. As one industry insider put it, "AI is a horizontal technology that creates vertical opportunities across every industry—opportunities that often involve buying and transforming existing businesses rather than starting from scratch." Finally, the boundaries between public and private markets continue to blur. Traditional venture firms increasingly recognize that arbitrary distinctions between private and public investing can leave significant value on the table. As these changes accelerate, a new investment playbook is taking shape. Rather than simply making passive minority investments in early-stage companies, leading firms are now: For Lightspeed specifically, the RIA status opens doors to a staggering expansion of its addressable market. Beyond the roughly 20 billion dollar annual U.S. venture capital market, the firm can now tap into the 100 trillion dollar-plus global public equities market and the rapidly growing 100 billion dollar-plus secondaries market. Industry insiders project several key developments over the next three to five years: For entrepreneurs, these changes create both opportunities and challenges. The emergence of more sophisticated, well-resourced investors means potentially more support for company building, but also more complex relationships with investors who may have multiple objectives beyond simply supporting a founder's vision. For limited partners (LPs) who invest in venture funds, the transformation creates new considerations around manager selection, fee structures, and portfolio construction. As venture firms expand their mandates, LPs must evaluate whether these broader platforms deliver superior returns or simply more fee revenue for the managers. The transformation underway has led some industry observers to characterize leading venture firms as "mini-Blackstones in hoodies"—combining the comprehensive investment approach of major private equity platforms with the technological focus and cultural orientation of traditional venture capital. This description captures both the ambition and the inherent tension in this evolution. Venture capital emerged as a specialized form of investing precisely because building early-stage technology companies required a different mindset, skillset, and structure than traditional asset management. Whether firms can successfully expand their mandates while maintaining their distinctive capabilities remains an open question. What seems certain is that this is just the beginning of a profound transformation. As Lightspeed's move to become an RIA demonstrates, the industry's leaders are betting that the future belongs to comprehensive investment platforms rather than specialized venture funds. For entrepreneurs, investors, and the broader technology ecosystem, the stakes couldn't be higher. The mutation of venture capital is reshaping not just how companies are funded, but how they're built, scaled, and ultimately realized—a transformation that will influence the technology landscape for decades to come.
Yahoo
24-04-2025
- Business
- Yahoo
A16z Unleashes $20 Billion AI Fund Fueled By 20,000 Nvidia GPUs As Marc Andreessen Bets Big On The Next Tech Superstars
Andreessen Horowitz is doubling down on artificial intelligence—literally. The Silicon Valley powerhouse, co-founded by Marc Andreessen and Ben Horowitz, is in early talks to raise a massive $20 billion fund, making it the largest in the firm's history. If successful, it would be one of the biggest AI-focused funds ever, second only to SoftBank's Vision Funds. Reuters reported that the firm, commonly referred to as a16z, is pitching the fund to global investors who want access to U.S.-based AI startups. Don't Miss: 'Scrolling To UBI' — Deloitte's #1 fastest-growing software company allows users to earn money on their phones. Hasbro, MGM, and Skechers trust this AI marketing firm — . The fund will focus entirely on growth-stage companies, with a large chunk reserved for follow-on investments in existing portfolio startups such as Databricks, Elon Musk's xAI, and France-based Mistral. Andreessen Horowitz is also expected to lead the funding round for Thinking Machines Lab, a new venture from former OpenAI Chief Technology Officer Mira Murati. Reuters reported Thinking Machines Lab is already courting a valuation of $10 billion—even though it has yet to release a product. In October, a16z launched a new initiative called Oxygen, which gives its portfolio companies access to over 20,000 GPUs from Nvidia. TechCrunch reported that this private GPU cluster can be rented by startups in exchange for equity, addressing one of the AI industry's biggest bottlenecks: compute power. Trending: BlackRock is calling 2025 the year of alternative assets. With demand for Nvidia chips soaring, this move allows a16z-backed startups to move fast without waiting on cloud providers or competing for limited hardware. The firm's strategy not only supports innovation but also reinforces its position as a major player in the AI development pipeline. The $20 billion megafund comes at a time of political and economic crosswinds. In 2023, a16z founders publicly backed President Donald Trump, a shift from their earlier Democratic leanings. Later, Horowitz and his wife, Felicia, announced a personal donation to groups supporting the Harris-Walz campaign, citing a long-standing friendship with then Vice President Kamala Harris. He emphasized that the firm's political stance remained aligned solely with its Little Tech Agenda. Investors are also watching the impact of Trump's proposed tariffs, which could affect the cost structure of AI infrastructure. Still, the global appetite for American AI remains strong, and a16z appears poised to tap into it while political conditions remain large by any standard, the $20 billion goal still falls short of SoftBank's original Vision Fund, which launched in 2017 with $100 billion. However, the follow-up Vision Fund 2 has faced headwinds—reporting a $2.4 billion loss. Meanwhile, Sequoia Capital's evergreen fund reached $19.6 billion by February. A16z, with $45 billion in assets under management, now seeks to join that elite club of high-stakes, high-impact VC players. Read Next: Here's what Americans think you need to be considered wealthy. Inspired by Uber and Airbnb – Deloitte's fastest-growing software company is transforming 7 billion smartphones into income-generating assets – Image: Shutterstock UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article A16z Unleashes $20 Billion AI Fund Fueled By 20,000 Nvidia GPUs As Marc Andreessen Bets Big On The Next Tech Superstars originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved.
South China Morning Post
09-04-2025
- Business
- South China Morning Post
Andreessen Horowitz seeks to raise US$20 billion megafund amid interest in US AI start-ups
Venture capital firm Andreessen Horowitz is seeking to raise about US$20 billion in what will be the largest fund in its history, to capitalise on global investors' interest in backing US artificial intelligence companies, sources told Reuters. Advertisement The tech investment firm, known informally as a16z, has told limited partners that the fund will be dedicated to growth-stage investments in AI companies and draw upon global investors keen on investing in American companies, the sources said. The record fundraising and the goal of capitalising on foreign investment interest in the US tech industry come against the backdrop of a sweeping tariff plan by President Donald Trump to urge companies to manufacture goods in the US To raise such a large amount of capital, a16z has been pitching it around the world. International LPs see the fund as a way to invest their money more easily into American AI companies without restrictions, one of the sources said. Andreessen Horowitz did not reply to requests for comment. Ben Horowitz, co-founder and general partner of Andreessen Horowitz, speaks at the WSJTECH conference in Laguna Beach, California, October 22, 2019. Photo: Reuters A16z's founders, venture capitalists Marc Andreessen and Ben Horowitz, announced last year they would support Trump, breaking with their traditional support for Democratic candidates, a sentiment shared by other prominent Silicon Valley figures such as Elon Musk. Even by the standards of a firm known for raising some of Silicon Valley's largest investment vehicles, the new fund would represent a colossal step up in scale. Advertisement
