Marc Andreessen Is Poor

The first headline that came out about this was “Exclusive: Andreessen Horowitz plans to launch a private equity fund, documents show” - but then someone actually read the “documents” being referred to and launched another headline of “Andreessen Horowitz isn't really expanding into private equity” and outlined what’s actually happening. It’s much less exciting, but you can read the article here. The internal fund that manages money for the GPs and some of their most successful Founders is expanding to offer PE to their internal clients. Not a headline.

But!

The joke/meme holds. It’s easy to forget for those of us who live and breathe VC stuff that it’s a pretty niche industry. It’s growing and it definitely moves a lot of weight culturally given their involvement with building the new tools we all use, but when you look at VC AUM (~$1T) it’s about 1/4th the size of PE (~$4.5T) and then PE is about 1/20th the size of Publics ($100T). Technically you can argue that VC is actually just a subset of Private Equity (VCs buy equity in private companies…), but the point is the same. It’s niche. They’re both niche. To stereotype though - PE guys make a lot more money.

It’s also worth noting that VC is still in its infancy as an asset class and these types of comparisons remind me of that. I don’t think VCs from the last decade will look the same as the next decade. People like Marc Andreessen are constantly pushing the limits of what’s technically venture. The ugly thing to say is that his ambition is forcing AUM into a model that doesn’t want it. The opposite side of that strategy would be Union Square Ventures who just keeps raising the same amount each fund. The more optimistic thing to say would be that he’s pushing the asset class forward. Institutionalizing.

Overall, I think VCs (and the founders they serve) will benefit from a few more “suits” in the room. Seed will always be Seed (flip flops and founder bets). But, it will be interesting to watch the Series A+ crew continue to grow up.

Sandhill Exclusive Content

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Investing for Unaccredited Investors → July 11th at 3pm

We will be going live Thursday July 11th at 3pm to learn more about investing strategies for unaccredited investors. During this event, we will be joined by:

• Steph Mui, founder and CEO at Pin, a platform for raising money & creating an investment vehicle to invest in startups with your community.

• Zehra Naqvi, a consumer investor at Headline with a large portfolio of angel investments.

Be sure to RSVP in advance and mark the event in your calendar!

ICYMI… Our Series B Fundraising Discussion!

On June 11th, we were lucky to be joined by two active operators who recently raised from top tier firms like Redpoint and Khosla:

Michelle Valentine

• Michelle is co-founder and CEO at Anrok, which helps SaaS companies solve sales tax compliance.

• Anrok raised a $30M Series B earlier this year from Khosla Ventures.

• Before Anrok, Michelle worked in product at Airtable and was an investor at Index Ventures.

Howard Ting

• Howard is CEO at Cyberhaven, which helps cybersecurity teams detect instances of data exposure in real time.

• Cyberhaven just announced a $88M Series C led by Adams Street Partners and Khosla Ventures.

• Before Cyberhaven, Howard was CMO at Redis Labs, Zscaler, and Nutanix.

​This event is brought to you in partnership with our friends at Sacra.

From the Vault 👇

Halfway through the year and re-thinking your investment strategies? Give our first episode from the Sandhill podcast a listen!

During this episode we were joined by Peter Walker who runs the Insights team at Carta. Peter spends most of his time focused on discovering key data and narratives across the private capital ecosystem, which in turn helps investors make better decisions!

Enjoy the listen!

Talk soon,
Adam

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