Proving himself to be one of the greatest entrepreneurs and investors of his generation, Marc Andreessen is said to consider himself: Another J. Pierpont Morgan. As a technology expert, Andreessen accelerated the growth of the Internet, Co-Founder of Netscape It was sold to AOL for billions of dollars. Since then, he has grown his own VC firm, named a16z, into one of Silicon Valley’s leading funds, with $55 billion in assets under management, and a tentacle in other financial areas. to become a leader in other financial areas. Here are his nine lessons from Marc Andreessen:
#1. Focus on new trends. Andreessen pioneered the emerging Internet and his groundbreaking venture, his Netscape, marked the beginning of the Internet. From Sam Walton (Walmart) and Dick Schultz (Best Buy) to Boxy Charm’s Joe Martin and Brian Chesky (Airbnb), nearly every entrepreneur has jumped on the new trend. .
#2. Finance After Strategy Aha, Third Aha! There are four Ahas and top 20 VCs in Silicon Valley, mostly doing post-Strategy Aha fundraising. To gain an edge over other venture capital firms, replace entrepreneurs with experienced CEOs, and drive and build ventures towards compelling exits. But if you’re an entrepreneur, wait for Leadership Aha!
#3. Respect Growth Engines. Andreessen and a16z partner Horowitz have a policy of respecting entrepreneurs and their time. Their company’s VCs are fined for keeping entrepreneurs waiting. They recognize that entrepreneurs are essential to bring ideas to Aha.
#4. If the evaluation is sky-high, it immediately flips. In venture capital, timing is critical to capturing high-value exits through strategic sales to gullible companies that see the potential but not the risks.This is approximately 70% to 90% corporate acquisition fails.
#5. Expanding from a strong foundation to an “easier” direction. Companies expand in the “easy” direction by introducing proven products into new markets or new products into established markets. While most VC firms stick to their own VC formations, a16z diversifies into money management and investment banking to combine home runs and bases for higher profits and synergies.
#6. Tie your partner with smart strings. Not too tight. Not too loose. a16z not only allows partners to explore new directions, but also monitors their operations to reduce losses. This means that partners can test new ideas with limited capital, invest more if they succeed, and cut back if they fail.
#7.Prove Your Hypothesis and Learn to Invest. Gamblers rely on their instincts. Smart investors do their homework. a16z challenges partners’ assumptions and requires partners to test to minimize risk. Except senior partners who can afford more.
#8. No boundaries. While some may shy away from entrepreneurs with shady pasts, 16z has no such concerns, including funding WeWork’s infamous Adam Neumann’s startup Flow. It seems
#9. Promote continuously. a16z is no stranger to PR helping companies like Coinbase. Airbnb, Affirm, Instacart, Netscape, and Skype are being touted relentlessly, allowing VCs to walk away with very high ratings. Valuations often plummet after they pull out, so watch out for that below.
My take: Andreessen and his company seem to have found the right mix of positioning on new trends, testing new directions, and pushing relentlessly for high valuations. But Andreessen is also human. After being an early investor in Instagram, his company invested in a competitor and avoided investing in later rounds. instagram fundraising. Competitor folds. Instagram has become a unicorn.
The above also suggests advice to the general investor. Be careful with your investments when venture firms, venture capitalists, and investment bankers are filling up and going through a pre-IPO, concurrent, or post-IPO hype cycle. promotional mode. Wait until the hype subsides before considering investing.