The a16z Show - Ben Horowitz on How a16z Was Built

Episode Date: August 23, 2025

Erik Torenberg sits down with Ben Horowitz, Cofounder of a16z, for a candid conversation on venture capital, leadership, and the future of innovation. Recorded live at a16z’s Menlo Park offices in 2023, Ben shares practical wisdom and hard-earned lessons on navigating market cycles, building resilient companies, and why culture is a lasting competitive edge.Timecodes: 0:00 Introduction 0:49 Building a Lasting Venture Firm1:57 Product vs. Investor-Driven Firms5:17 Evolution of Andreessen Horowitz8:43 Fund Sizing & Market Opportunity11:38 Recruiting & Culture at a16z13:58 Supporting Founders & Firm Mission14:39 Governance & Firm Structure17:15 The Future of Venture Capital20:26 Riding Trends: AI, Web3, and Beyond27:06 Regulation, Open Source, and Innovation29:22 LPs, Macro, and Long-Term Strategy33:25 Advice for the Next Generation37:15 Tech Optimism & Societal Impact42:33 Closing Thoughts & Outro Resources: Find Ben on X:  https://x.com/bhorowitzSubscribe to Turpentine VC: link.chtbl.com/TurpentineVC Stay Updated: Let us know what you think: https://ratethispodcast.com/a16zFind a16z on Twitter: https://twitter.com/a16zFind a16z on LinkedIn: https://www.linkedin.com/company/a16zSubscribe on your favorite podcast app: https://a16z.simplecast.com/Follow our host: https://x.com/eriktorenbergPlease note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures. Stay Updated:Find a16z on YouTube: YouTubeFind a16z on XFind a16z on LinkedInListen to the a16z Show on SpotifyListen to the a16z Show on Apple PodcastsFollow our host: https://twitter.com/eriktorenberg Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see a16z.com/disclosures. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

If you look at the firm now, what it is is it's a collection of the original Andries and Horowitz, where every market has a platform that's appropriate to that market and an investing team that is focused on that market. And I think that that's the future venture capital. We're in this phase where it's such a profound change that anything you do will work, at least for a while. And so it's kind of hard to pass on any deal in that way, so it's exciting. What we care about is, is it a real breakthrough? and how big can we help make it? Can it win the market? Like, those are the things that drive us. Today, you'll hear my 2023 conversation with Ben Horowitz, co-founder of Andreessen Horowitz.

In this episode, I sat down with Ben to discuss what makes a firm last for decades, how AI is built differently, and the future of venture in an AI-driven world. Let's get into it. Ben, thank you for being the first inaugural guest. Let's podcast. Yeah, no, happy to be here. Thank you. Ben, we're just talking up camera. There's some firms that are great for 10 years and then struggle, there's some firms that are great for 30 years, multi-decade. What separates the firms you could do that and what enables them to be great? Yeah, I think it's a combination of kind of the lasting parts like the culture and then the parts that change like the leadership. And so I think that, you know, if you just have a couple of smart investors, but no culture to speak of,

then you're probably not going to do a great generational handoff. And, you know, that's probably 10 years. Is it kind of 10 years is a pretty good run for investors. You know, like maybe you stretch that out. Then, you know, if you can transition it like, you know, Sequoia transitioned it from Don Valentine to, you know, Mike Moritz and Doug Leone and Jim Gets. And that worked, you know, that transition worked well.

So they were able to kind of take the original culture, and build on it and kind of grow it, you know, 20 years for the original guys, 20 years for the successors and that kind of thing. So that goes pretty well. You guys are knows bring chickens, almost 15 years. Yeah. How do you think about it for your firm? Yeah, so we're a little different in that we are organized in such a way where it's not like Mark and I can have like very significant contributions without picking the investments. Because, you know, we have, I would just say, more scale and more job functions at Andrewsson Horowitz because we're kind of a product first and then a team of investors second,

whereas every other firm, I think, is the opposite. Product meaning the product to entrepreneurs. So like what are we offering is where we start. and then the team of investors is kind of goes with that as opposed to we're a team of investors and then like we'll figure out what our product is as we go

so it's a very kind of different orientation. I've always thought of why a Combinator is another example of a product firm in the sense that you could replace a lot of the investors they have over time and yet it still seems to work to some degree. I think that's right. Like I think they're probably you know the closest analog to us kind of spiritually.

Yeah. So they're spiritually close to you, but they're much earlier and they dominate kind of like company creation. Whereas you, you do a lot of seed, of course, too, but you played all stages. Have you thought about going after that space, like pretty hardcore? How have you thought about where you situate in the ecosystem? Yeah, you know, it's funny because we, Paul and us started, you know, around the same time. He started a little earlier. And, you know, we talked to them quite a bit during that.

that phase when he was running Y Combinator out of his house with Jessica. And, you know, I have to say, we never really thought about kind of being Y Combinator. And I think, like, a lot of it has to do, you know, my philosophy of business is you have to start with, okay, what can you contribute that's going to be important in the world that nobody can do better than you. And, you know, for us, a big thing that we had done is we had scaled companies. built into very large size. That wasn't really kind of Paul's experience, but he had thought super deeply about like the very initial kind of part of it. So I think that was the right thing for him to do and we did the right thing for us to do.

And I think the world was better with us doing our thing and him doing his thing, but like he's got a great business. Totally. And so you're a product, you're not like he and his success. Yes. Totally. The most special firms are collection of investors. is some of your collection of venture firms in some ways where you have these distinct, you know, American dynamism and bio and crypto and games, these different practices.

Should other firms think, are you guys ahead of a curve and other people, other firms will follow you? Talk about the evolution to that structure and why that made so much sense. Yeah, so it's interesting. So when we started the firm, there's a lot of conventional wisdom in venture capital. Like there are only 15 deals a year that ever going to make it to $100 million. dollars, you know, it's a cottage industry, you know, done by like you can only learn it through apprenticeship and all the, you know, a lot of concepts, which I think we're probably correct at the

time, but the thing that we believed then, and Mark kind of encapsulated that PC wrote in 2011 called Software's Eating the World was the Software industry was going to grow a hundredfold. And so 15 companies is going to be 150 companies, and like things were going to change. And so in order to kind of be the preeminent venture capital firm, you were going to have to be a lot bigger. So we kind of saw that from the outset. And so we set ourselves up to be able to kind of organize, reorganize, evolve. And if you look at the firm now, what it is is it's a collection of the original Andres and Horowitz, where every market has a platform that's appropriate to that market

and an investing team that is focused on that market. And I think that that's the future venture capital. Like when we think about who's really an interesting competitor, it's the pure crypto firm, the pure games firm, the pure AI firm, more than the generalist firm that's trying to cover all of that with the old structure. I think that's going to be harder for them. Speaking of the future of venture, will venture firms consider going public or should they consider like a YC or like you guys or firms that achieve such level of scale? Yeah, so there's a real interesting alignment problem with going public if you're a venture capital firm and it's as follows.

So if you look at Apollo or, you know, Blackstone or any of these guys' private equity companies that have gone public, the public markets value them. on their fee stream much more than on their investment returns. I think that's a safer, you know, kind of alignment between the investors and the firms in private equity than it is in venture capital. I think in venture capital, that can get super dangerous because the, even at 100x, what it used to be, the entire venture capital market is not that big. and is, you know, like the amount of capital versus the amount of great ideas, like we're already have more capital than great ideas. And as we saw, I think, with both SoftBank and Tiger Global, if you try to change that demand supply imbalance,

you just end up creating a mess. And so if you were public, you'd have a strong incentive to create a mess. So they went big and created a mess. But you guys went as big in some ways, right? Your volume was very high. Your funds raised is very high. You went big in a much better way. We didn't go $100 billion.

And then I think Tiger was raising $12 billion a year. So they were bigger than us just technically. So, yeah, look, we've scaled to basically size our funds to the market opportunities. So the way we look at it is, like, in a two-to-three-year time frame, How many great deals will we see in a category and then try to size the fund to basically cover that time period is kind of roughly how we do it? And that's certainly increased fund sizes, both fund sizes and the number of funds over the years. But it's still really contained compared to what you do if you were just scaling assets. I think it's still like way smaller than like what Apollo or Vista or somebody would do in that kind of business.

So yeah, so I think that misalignment is pretty tricky for venture capital to overcome. Like I haven't figured out a way where you would overcome that yet. Right. So a firm like a firm that stay diligent like a USV or diligence on fund size, you know, a benchmark or kind of stays 500. or 250 respectively. They believe that they can get better multiples on that, you know, much smaller fund size. What do you believe that they don't believe that in terms of justify, why goes so much bigger? Yes, I think the market's just gotten bigger.

So I think the way to think about it is if you believe the market was fixed at 15 companies, then that's the exact right strategy. Right. And, you know, we don't believe that. And I think that, you know, I'm not allowed to talk about our fund returns because we're an RIA. But, you know, if you look at our funds, I think our larger funds have at times, like, way outperformed or smaller funds. And that's just kind of a function of, look, if there were 15 companies and now there's

150, then if you had a $400 million fund, then maybe you need a $4 billion fund to do the same deals. Or if you win the same percentage of that. And, you know, like that's just a simple math. And I think that they're, look, they're different beliefs. They think benchmark believes that they believe, we believe, what we believe. And again, look, our mission isn't to, isn't necessarily fun turns, right? We have a mission to kind of help the best entrepreneurs in the world build the best companies that they can.

And so, you know, we generally come at, like, the whole structure of what we do from that perspective. I think also, look, we could all get much higher salaries if we didn't organize the firm the way we did. But, you know, like our mission isn't to maximize the number of money per partner. Our mission is to kind of be the resource for building great technology companies. So it's just like a different point of view. And so how do you recruit such amazing partners if at other firms because they don't have these resources, maybe they can get higher salaries or, you know, there's certain perks of being at one of those firms. How do you think about recruiting the best talent?

Energy reason. Yeah, well, I think that, you know, people here, it's actually helpful that we kind of pay lower salaries to me because we get people who are on mission. Very long. And, you know, like, there's a lot that goes into that. You know, like there's a, for example, there's this kind of thing in venture capital that a lot of venture capital will say, well, spend all your time with your winners. Like, we don't believe in that at all. Now, like, if you look at a spreadsheet, that's exact right thing, right? like because the whatever three winners are going to produce all the returns. But the way we look at it is, you know,

several, one, we're not so confident that we know who the winners are for a long time. The other thing is that, you know, we kind of have the philosophy is, like, we knew the job was dangerous when we took it. If you're going to take us as your partner, we're going to be there until the bitter end. And like, that's, you know,

having been very close to the bitter end myself from time to time, like you really do need kind of support or at least somebody to talk to when you're in that situation and because just from a competitive standpoint, our whole idea is that we sell on reputation. That's fundamentally important to our competitive advantage is to have the best reputation.

So all those things kind of cause us to behave differently. And if you're not into that, if you're into the spreadsheet view of venture capital, then you would hate that idea. So it actually works for us in that sense. And because you've spent the last decade plus building this brand reputation, there's lots of other things that you could do. You can get into things beyond venture, right? Different firm, you know, some firms get into sort of more public investing, get into wealth management.

They get into other products that serve, you know, kind of adjacent customers or serve their customers in adjacent ways. How do you think about what makes sense to get into, first what doesn't make sense to get into? given that your brand enables these opportunities? Yeah, so the way to think about what we've done so far and what we'll do in the future is the customer is the founder for us. So we start with the founder. And the initial promise is, you know, we're going to help you raise money.

We're going to help you develop into a CEO. We're going to build you a network that's as good as Bob Igers. We're going to, like, help you train you into the job. and we're going to support you in every way that we can, you know, through our financial network to help you kind of build this company. And, you know, in our view, we'd like to extend that through the founder's entire life from the time they found the company to the time they become a philanthropist. And so anything in that realm we feel like is, you know, kind of things that we ought to at least consider doing.

And, you know, which ones we do in which order we'll see, you know, depending on. you know, where the gaps in the market are and what makes sense for us. One thing we've talked about off-camera is that one thing that enables you to take such big swings or make these changes when the market changes is your unique approach to sort of governance or control. When you talk about that relative to other venture firms. Yeah, it's interesting. It's kind of a concept that we got from a couple of people. One was Herb Allen, who, you know, I think, and then the other was Mark's father-in-law. Hey, we'll continue our interview in a moment after a word of

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Carter's suite of products and expert services helps funds at any stage with up-to-date insights and automated workflows to get them to that next level. The future of VC is already here, and it's Carta. Learn more at Carta.com slash turpentine. That's carter.com slash turpentine. And they both kind of gave us the same idea which, so traditionally in venture capital, I think it looks a little like a law firm or kind of a lot of these partnership structures where you have shared economics and shared control.

And like from a partner's standpoint, there's a lot, you know, that makes a lot of sense in a lot of ways. We have a different structure where we're shared economics, but we've kind of centralized control. And that enables us by not having. having shared control, we can change the structure of the firm very easily. And if you want to grow, like so, you know, if you want to go, you know, in an integrated way, like you could have, oh, that's the Chinese subsidiary or whatever, and that's a whole other

entity, and we talk to them, you know, once every six months. That's not what I'm talking about. But if you want to grow in an integrated way with a kind of single culture, single offering, then you have to be able to change the organizational structure, you know, as you get bigger. So like the structure that you had at 50 people is just not going to work at 500, and that's for any organization. But in order to do that, somebody's got to be able to make that decision with no politicking, no arguing, no, you know, like there will be tears because whoever lose power is going to, like, be upset about it.

But you have to be able to make those tough decisions to get to the structure that you to be maximally effective. And that's just really hard to do, I think. I don't know how you would do it with shared control. Let's get back to the future of venture. Let's say we're having this conversation 10 years from now or 15 years from now. Does venture kind of look, does the trends that are happening now continue to happen where there's just this bifurcation, you know, multi-stage firms become even more multi-asset

firms that just get bigger and bigger and this sort of, you know, solo GP or small specialists on, you know, kind of this barbell or do new models come into play? like venture studios really take off or do emerging technology like Web 3 or AI really change how venture works or say more about the future of the future? Yeah, no, like all possibilities. I mean, look, I think the kind of classical venture firm

that is just like a collection of smart investors, like I think that's probably run its course. So I think you have to be like a top end like serious brand that can marshal resources and money and considered smart money and people want to follow you know i put us in that category sequoia you know there's that class of thing and then there's people who are very specialized in a very kind of specific part of the market and know that network and have really great specific expertise and they'd probably be you know more early stage, I would think.

And those two things seem pretty solid, at least for the next five, ten years. Everything else, a little more questionable. I think, you know, with the studio model, to me, the big problem with

that historically, and, you know, I think Bill Gross was probably the greatest practitioner of that historically, is that it's not an idea. It's an idea maze. Yeah.

And so, and it's very hard to run through the idea maze if it's not your idea. And so, like, that's a, I think that tends to be problematic. That's kind of, it's a little bit of a design for the head of the studio's lifestyle and kind of capabilities as opposed to what's going to make a great company. And so I don't know that that's ever going to work. And I thought Paul's genius was the ideas weren't his. Yeah. And that was the difference between an incubator and an accelerator.

And that, I think, you know, just proved to be the right model. And the reason it's the right model is because whoever's building the company, it better be their idea. Yeah. When you identify an emerging trend, whether it's Web 3, whether it's AI, whether it's companies that get big and it's really big, really fast, and during the pandemic, let's say, and some people are more prudent about it. Some people are more bullish. And I put you guys more on the bullish camp, smart bullish, but bullish. And is the logic there that, hey, not everything's going to work out, but the things that work just works so much that it just really makes sense to be extremely bullish?

I guess when you reflect on the past few years and things that you went really hard on, if you were to do versions of again going forward in future, now this AI wave, of course, how do you think about riding trends and how hard to ride them? If you look at the history of technology, almost everything eventually worked. Yeah. All the stuff. Go back to 1999, 2001, all the dot bombs. Oh, that's the dumbest. Ha, ha, ha, pets.com, how stupid. You know, like all that stuff, you know, and then diapers.com sells for $800 million later.

It was just a little ahead of its time. Yeah. And I think the beauty of venture capital is you can make the bet, and if you're too early, you can make the bet again. And you learn a lot. If the clean energy craze happened again, if you guys were around during that time, do you think you would have bet big there and just that A, we're 10 years earlier? Well, that one is a little different in that.

That was like a politically motivated market, which is a different kind of a thing. I mean, I think so we're big believers in software. And if there's like a massive software break, through that has new applications or new models or these kinds of things. And we'd certainly be on that, anything like AI or crypto or like, you know, or like, you know, what's going on in games. Like, we bet that every time. I think climate was a little difference.

It wasn't software as material sciences, which has a different market dynamic. So it's kind of like they're eventually became a small number of auto companies. There never eventually became a small number of software companies, despite what Larry Ellison and all those guys said that there were only going to be three software companies and all that thing. Because it's kind of like, it'd be like there's only going to be three novelists. It's a creative art form.

It's got a very big design space. And so, you know, we think there, you know, if there is like a big change in how you can write software, which AI is probably the biggest change we've ever had, that's going to yes that's going to produce things and we bet that all day all the time every day

and I think like that's also the kind of value of being able to evolve the firm is look people who knew smartphone network effects may not be the ones who really get AI may not be the ones who really get crypto etc I know Mark is spending a bunch of time in AI right now talk about the AI strategy

at how you're approaching AI in terms of this is both how you think about it from investing perspective, but also does it change things at the firm more broadly? Yeah, well, like it does change things at the firm broadly. You know, from an investing perspective, it's kind of like, oh, my God, we have non-deterministic computing. Like, holy cow. You know, like, it's a whole, every problem we couldn't solve with deterministic computing is now for grabs. Yeah. And that's like, you know, we've never seen anything like that. So from a firm perspective, I think, you know,

we end up needing, okay, different expertise. We need kind of access to different networks. We need kind of different kind of help for entrepreneurs. Like it's amazing. So many of the AI entrepreneurs are actually, they're not even engineers that are like researchers. Yeah. So this is a totally different type of cat to be starting a company.

And, you know, what do they need to succeed and that kind of thing? So it's a very big tidal wave kind of running through the firm and running through the industry. But we can be more excited about it. I mean, the other thing is like we're in this phase where it's such a profound change that anything you do like will work at least for a while. Yeah. And so it's kind of hard to pass on any deal in that way. So it's exciting.

Well, and that was true also of Web3 for a moment. When you think about Web 3, do you think, hey, it's just in a momentary lull, partly sponsored by markets and developer activities higher than ever? I've been struck just by how far ahead AI is of Web 3 just on terms of use cases and products. And yet I've been ignoring AI up until the last year or so,

and I was spending more time in Web 3. Like, what did I, you know, was the financialization distraction or I guess reflect on that a little bit? Or what's your perspective on that? Yeah, so there's a few things. So one is like AI happened overnight. Like this AI model started in 1943. So it was a long time coming.

And finally, like working really well. I think with crypto, it started like in earnest in 2008. Like that was the 1943 moment. So it's a lot younger than AI. And like I think in fact, so and there have been kind of, a variety of use cases. Some of them have been, so there's like this what we call Web 3

and, you know, a new way to build networks. That's fair and not, like, doesn't tend towards these, like, very dangerous monopolies that control all information and all these kinds of things. But there's also kind of like a,

because you can create money, there's a casino aspect, which, you know, needs regulation. and we've been kind of working with the U.S. government to try and get the correct regulation. And so, you know, in its current state, I would say there's two things. One is we need performance to improve a lot, you know, and kind of gas fees to lower and performance to improve, so usability can improve and that kind of thing.

And that we're really on the verge of. I mean, like, I think we're going to see 100x improvement of the kind of base infrastructure in the next turn in the next year. So that's awesome. The other thing, though, is the kind of regulatory regime and, like, what's possible and can we get clarity and so forth. And we're working on that both kind of domestically and internationally. But those are kind of things that in order to get very broad adoption, that's going to have to overcome. Like, AI is already getting broad adoption because, like, it works. Now, the regulators are now moving in and, you know, very ironically, oddly, oddly,

bizarrely talking about trying to ban open source, which is probably the safest thing that could possibly happen in AI because, you know, the last thing, if AI is this all-powerful thing, then the last thing you want is it in the hands of one person or one company. Like, that would be horrible and dangerous. Whereas if it's open source, universities can work on it. We can understand it. It can be deployed. I mean, like, I often remind people, like, the last nuclear bomb that was launched was when only we had the nukes. Like that, that's a dangerous world with one person having the nukes. And now everyone has nukes and a bunch of people have nukes and we haven't had.

Yeah, we haven't had any nuclear activity. And there's a very, very specific reason for that because everybody's got nukes and nobody wants to get nuked. And I think that AI is, you know, to the extent that AI is a super weapon, that will also be true there. And so if you believe that, then I think what you want is open source. And I think if you want regulatory capture, monopoly for yourself, you want to shut that down.

You mentioned earlier that you consider your peers as the best kind of specialist firms and you compete with those firms. Do you also see your peers or competitors, firms, other multi-asset firms that are not even adventure? Like as you get bigger and bigger, AUM, you know, are there firms that you see yourself as veering into their space? No, so, like, you know, it's funny because I've spent some time with both kind of the folks at Black Rock and at Apollo just trying to understand their structure and why they're public and these kinds of things.

And I would say they are culturally, philosophically, operationally the opposite of us. So, like, they're very, very price focus. They're optimizers. They're, you know, efficiency experts. Like, we don't care about any of that. what we care about is like, is it a real breakthrough and how big can we help make it? You know, can it win the market?

Like, those are the things that drive us. So there's nothing about what they do that would make them good at what we do, and there's nothing about what we do that would make us good at what they do. So, like, I think, you know, we'll never get into that realm. Yeah.

And when people focus so much on returns, it also, it's important to think about just the LP product. Like, my understanding of the soft bank thesis was that this is a place that LP could plow a ton of capital and get some like consistent you know return and there's not that many places

where you could just plow all that capital into one place and get that kind of diversification is that how you think like how do you think about the LP product that you're offering? We think about LPs differently so we think about LPs or the way we like to think about them is the same way a company would think about it's VC

so one so we're not building a product for them we're building a product for founders and they can invest in that product. And then there's a couple of things we think about there. One is we want to have the kind of investors that we want to be in business with for a very long time.

So we choose them very carefully. And two, we want to treat them like investors. And I think sometimes venture capitalists make the mistake of not doing that, which, you know, what does that mean? It means, well, like you shouldn't have them invest if you don't respect their opinion, aren't interested in what they have to say, don't want to keep them up to date on what you're doing. Then you're not treating them like investors if you don't do that.

And I think what we're going to find out in this kind of particular interest rate change environment is that like the VCs who didn't treat their LPs like investors are going to be in for what that means in bad times. Does macro inform your firm strategy? No, no, like I think we've got to be very careful about that, in fact. So one, macro, in our view, is highly unpredictable. Right. So that's the first thing.

And so we don't try to predict it. And then secondly, we have a 10-year horizon on exits. So if we invest in a company today, we're expecting it to come out in the environment in 2033. And so in 233, the idea that we could predict that macroeconomic environment is like pretty absurd to me. Like even to talk about it sounds weird. Hey, we'll continue our interview in a moment after a word from our sponsors. Turpentine VC is proudly sponsored by Synaptic. Are you investor looking to make better investment decisions?

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we're out there now, you know, like, knowing they're not doing the follow-ons. Like, they won't even return the call. And so you get into that kind of situation. It's like, that's not even smart for you. Like, you know, it's kind of like you're a bad person for not calling back somebody you invested in, but like, that's not even smart for you.

Like, what are you doing? Like, you don't know what's going to happen in 2033. Right. Makes sense. When you started the firm, people like Michael Ovitz and others gave you advice on how to think about the firm in a different way based on the market at the time. I'm curious for the next Ben Horowitz and Mark Adreason out there who are 20 years or 30 years younger, whatever,

they're just starting out, but want to build the next A16Z, but they're identifying, you know, thinking of the market at, looking at the market at 2023, and let's say they're coming to you guys for advice, and you want it to give them advice. How would you think about creating next A16Z, you know, starting in 2023, given where the market is today? There already is A16Z. That's the, yeah, the Uber-Frax is Uber. If they wanted to create a Hollywood talent agency, then I would have plenty of advice for them, maybe. Fair enough.

You've coined the term, you know, wartime CEO, peacetime CEO. I'm curious if we could think about, you know, wartime VC. Because right now it's a tough time in markets, tough time to get a firm off the ground. You know, people are more skeptical about venture. People are skeptical about tech more broadly. It's an anti-time tech. What it's like to be a wartime VC or to be techno-optimists in a world that is, increasingly pessimistic.

Yeah, so, like, I think the biggest kind of war kind of issue that we have is actually probably with the regulatory environment and some of the ideas of the kind of current administration where they have

become anti-innovation. And look, we've already seen like a pretty large percentage of the crypto venture capital go overseas. So like the idea that the United States would forfeit the internet of property rights and money at such an early stage in its life.

Yep. It just feels so absurd, you know, it doesn't even feel like America in that way. And like that literally fake things that they're blaming it on, like, oh, crypto's funding fentanyl. I read that today. I was like, what how are you talking about it? It's like literally the most transparent form of payment that there is in the world, like more than Visa, more than dollars, more than anything.

like for somebody, you know, a senator to come out and say some just completely, something that she no doubt knows isn't true, you know, to kind of push innovation overseas is like that's a real wartime kind of situation for us in innovation land. And I think we're seeing the same thing in AI. We certainly have, you know, struggles for a different reason in bio and, you know, that kind of technology. But like so I just give you the on bio, though, The FTC recently sued to break up a deal between a bio startup and a kind of big pharma company.

Like, it's pretty impossible to do drug to fund drug development if there's no M&A market. So to literally like outlaw new science for health, new financial technology, new kind of property rights in the virtual world is like a really, hard stance for us to understand. So we are, you know, working with policymakers and trying to understand, okay, yeah, because it's not all like, you know, bananas. Like some of it is, you know, certainly makes sense. But to kind of shape that for like a future

that's prosperous for America is like a big effort from the firm, and we're working hard on that. But that feels like wartime. That feels like, okay, now we have actual threat existential threat to innovation in America. You know, in terms of being a tech optimist, I always like to go back to a quote from Annie Grove, which I absolutely love, which he said in the 90s.

And somebody asked him, they said, Andy, is the microprocessor good or bad? And he said, well, that's not even the right question. That's like asking is steel good or bad. It is. And so it's our job to make it good. And that's, you know, a lot how I feel about kind of all these technologies is they are going to exist. Like you cannot, you can't get rid of the wheel now.

Like it's over. Like it's here. You can't get rid of AI now. It's over. It's here. Like you can't outlaw math. You can't. Like that paper's already out there.

Like you're not going to stop it. Like the whole idea that you're going to stop people from doing it is just so crazy. So then the real question is like, okay, what do we have to do to make it good? positive for society and so forth. And by the way, without new technologies, like, how are we gonna deal with pandemics or climate change or any of the real issues facing the world? Like, it's not even possible without technology.

Like, like lockdowns didn't work. Now the policy stuff worked. You know what works? Pax lovid. That works. You have COVID, you take that, like you're good. That works. So we need technological solutions to these very, very daunting problems that we have with a, you know, more and more populous earth and all these kinds of things.

So, you know, that's how we remained optimistic. Yeah. And maybe gearing towards closing here, as I mentioned to you, you guys have been very helpful to us. You know, we're seeking to create this new kind of tech media company. It's more driven by insiders that has more of a pro-tech approach. What advice would you have for us or when you look at the kind of media ecosystem, what more do you want to see? Yeah, well, I think you're on like a really good track, which is, you know, what I want to see is, okay, I'm a young person and I want to understand where the world is going and what's happening and how I can get involved and make my contribution. What do I need to know? And I think that's, you know, like, how does AI work? What is this new computational model of the universe? How can I learn about it? How can I kind of push things forward, which is like largely absent? I would say, I mean, I think you're walking into a vacuum is the good news.

But, you know, that, when I was a kid, there used to be like Dr. Dobbs, you know, and Wired Magazine was that way for a long time. But, you know, now it's just like these weird politically charged, you know, whatever criticisms of how things are run or how things are built or what they're going to do or every negative consequence of everything. You know, the Internet had so many negative consequences. but like I don't think, you know, if we got rid of it, then like, if you're in Bangladesh, like, you now have no access to any of the information that people in the rich world have.

It's done amazingly great things. But, like, yes, there's cybercrime. Yes, there's porn. Yes, there's a lot of things that, you know, probably are not a general positive for a society. I think people over-obstracted from the Elizabeth Holmes or Theranos situation. Yeah. identified, hey, I could make a career. There's, you know, finding more of these

and there's got to be more of these, thinking that over-extraction and another over-extraction was around sort of defending democracy, you know, because Facebook somehow people's minds contributed to Trump. Well, the funny thing was, like, if you go back to 2008,

all the stories on how Obama got elected with Facebook. Like, he mastered Facebook, he got elected on Facebook, Facebook's the greatest thing. It's making the world more democratic, Arab Spring. Wow, this is so awesome. And then Trump gets elected, and it's like,

this is a threat to democracy. We're all screwed. Got to shut down the social network. So, you know, like, it's interesting. You know, when things get political, they get very weird, very fast, I think. And what's funny now, we're here to close. Is AI is, it's now coming from within the house

in terms of some of the people who are most active are within tech in terms of, and maybe it's regular capture. or maybe it's something else. I think it's regulatory capture. I mean, I... Some people are true believers. It's the Google guy.

Like, some people are... Really early. Yeah, I agree. Look, there are people who are genuinely worried about how powerful the technology is. And I think, like, those are good worries. Yep. But the idea that the way you deal with the powerful technology is you put it in the hands of a few is the most craziest idea. Well, like, look, power in the hands of the few has never turned out.

well, right, like with the best intentions, right? People love Karl Marx's intentions, but Stalin, Pol Pot, you know, Mao, like everybody died. That's what happened. Everybody died. And like all those guys didn't start out to be like singularly, uniquely evil people, but they had too much power because you take all the power of the private sector and put it in the hands of a few guys in the government. It doesn't matter what the political philosophy is, that's bad. And similarly, if you take all the power of the industry and you put it with two companies, that's going to be bad. I can guarantee you that.

I don't know what else is going to be bad, but I know that's bad. I think it's a great place to wrap on the uplifting note of power to the people and decentralized power. Ben, thanks so much for coming on the podcast. Yeah, no, great, Eric. This is good. And great luck and the best of luck. We're all excited about

what you're doing and its impact on the world. Thank you. Thanks for listening to the A16Z podcast. If you enjoyed the episode, let us know by leaving a review at rate thispodcast.com slash a16Z. You've got more great conversations coming your way. See you next time. This information is for educational purposes only and is not a recommendation to buy, hold,

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