Title - “”
Author - Alex Konrad, https://www.forbes.com/sites/alexkonrad/#4cdc7a5b3c5f
TL;DR - Andreessen Horowitz is renouncing its venture capital status to free up its ability to pursue riskier bets such as cryptocurrencies, potentially charting a new way forward for VC.
Helpfulness - 5
Tags - notable investors, andreessen horowitz, legal issues, new models for VC
- How are the major VCs adapting for the future?
- What are the next trends in VC?
- How does this change the fundraising landscape?
- The SEC limits investments in cryptocurrencies to 20% of traditional VC funds because they are deemed “high risk.”
- For that reason, the firm decided to renounce its VC exemptions and register as a financial advisor.
- The firm plans to launch more specialized funds in the future to stay competitive.
- Current VC landscape is divided into small, specialized seed funds and larger generalist funds.
- Recent years have seen increased pressure on traditional VC from above (e.g. SoftBank) and below (e.g. experienced angel investors).
Follow up links:
- SEC exemptions for VC, https://www.sec.gov/spotlight/sbcfac/2020-02-04-presentation-vc-fund-definition.pdf
- Andreessen Horowitz crypto fund, https://techcrunch.com/2020/04/30/andreessen-horowitz-just-closed-its-second-crypto-fund/