The Investment Legend from Web2 to Web3: The Evolution of a Top Venture Capital Firm

In 2009, a venture capital firm named Andreessen Horowitz was established in Silicon Valley. The company is abbreviated as a16z because there are 16 letters between the first and last letters of its founder's name. With successful investments in several well-known internet companies such as Facebook, Twitter, and Github, a16z quickly rose to the top tier of venture capital firms in Silicon Valley.

Currently, the assets managed by a16z exceed $35 billion, with investments spanning a wide range of fields including artificial intelligence, biomedical, consumer services, cryptocurrency, enterprise operations, fintech, and gaming. To better focus on different areas, a16z has established several specialized funds, among which the a16z crypto fund, dedicated to the cryptocurrency industry, is particularly noteworthy.

Pioneers in the Cryptocurrency Field

As early as 2013, when many traditional venture capitalists were still skeptical about the cryptocurrency industry, a16z had already begun to venture into this emerging field. It was the first to lead a $25 million Series B funding round for a well-known cryptocurrency exchange platform and subsequently made multiple follow-on investments. This decision not only brought substantial returns to a16z but also established its leading position in the cryptocurrency investment space.

In order to further develop the cryptocurrency market, a16z established a dedicated cryptocurrency fund, a16z crypto, in 2018. The fund has completed five rounds of fundraising to date, with total managed assets exceeding 7.6 billion USD:

• In 2018, the first fund had a scale of approximately 300 million USD.
• In April 2020, the second fund had a scale of approximately $515 million.
• In June 2021, the third fund raised approximately $2.2 billion, setting a new record for cryptocurrency fund-raising at the time.
• In May 2022, the fourth fund (approximately $4.5 billion) and the Web3 gaming fund ($600 million) were launched.

It is reported that a16z is preparing the next round of approximately $3.4 billion in early and seed-stage funds, focusing on emerging fields such as cryptocurrency and biotechnology.

Composition of the Elite Team

a16z adopts a full partner system, with each specialized fund led by industry experts serving as investment partners. In the crypto space, Chris Dixon plays a key role. Since joining a16z in 2012, Dixon has led several significant crypto investments, including a well-known blockchain platform, a crypto exchange, and an NFT project. In 2022, he topped Forbes' list of the world's best venture capitalists.

Before joining a16z, Dixon was a successful entrepreneur and investor. He founded the internet security company SiteAdvisor and the technology recommendation company Hunch, and was involved in founding the venture fund Founder Collective.

Currently, a16z has 546 employees, of which 99 focus on the cryptocurrency sector, accounting for 18%. This proportion highlights the company's emphasis on the cryptocurrency industry. Within the crypto team, 15 people are responsible for investment decisions, while approximately 80% of the remaining personnel focus on providing comprehensive support in marketing, recruitment, legal, and technical areas for the invested companies.

Unique Investment Strategies

a16z crypto inherits the investment philosophy of its parent company, while also developing its own characteristics:

1. Adhere to "all-weather" investing: Regardless of the market environment, maintain continuous investment. Even during downturns in the crypto industry, a16z crypto remains active.

2. High proportion of leading and follow-up investments: According to data, a16z crypto ranks first in the industry for cumulative leading investment rounds. For promising projects, it often demonstrates a strong commitment to continued follow-on investments.

3. Wide investment scope: a16z crypto has invested in hundreds of crypto projects, covering almost all sectors of the crypto industry.

4. Emphasize media promotion: a16z innovatively established its own media channels to disseminate investment concepts and educate the market through content output. Chris Dixon, known as the "strongest evangelist of Web3", frequently speaks out for the crypto industry in public.

5. Strong post-investment support: Drawing on the Hollywood agency model, a16z provides comprehensive marketing, legal, lobbying, and other support services for investment projects.

Looking Ahead

The development history of a16z is just as its founder Marc Andreessen said: "Software is eating the world." From Web2 to Web3, a16z has always been at the forefront of the times. As described on the company's official website, there are three eras of the internet: the first era (1990-2005) when a16z was not yet established, the second era (2005-2020) witnessed the rise of a16z, and now we are at the beginning of the third era.

In this new era, how will a16z continue its brilliance? The answer may lie in its ever-expanding landscape of cryptocurrency investments. By continuously focusing on emerging technologies and maintaining an innovative mindset, a16z is expected to once again demonstrate its foresight in the Web3 era.