Andreessen Horowitz's Crypto Bets: Where Are They Now?

Andreessen Horowitz is a Silicon Valley venture capital firm founded by Marc Andreessen and Ben Horowitz. The company has shown a strong interest in the cryptocurrency market, launching a $2.2 billion crypto fund to invest in blockchain and digital asset startups. Andreessen Horowitz's crypto arm has reaffirmed its commitment to startups building blockchain projects, with its third crypto-focused fund being among the largest capital commitments to the crypto ecosystem in history. The firm has stakes in companies like OpenSea and Dapper Labs, and its partners have compared blockchain's potential to that of the internet, remaining 'radically optimistic' about the future of crypto.

Andreessen Horowitz's $2.2 billion Crypto Fund III

Andreessen Horowitz, the venture capital firm founded by Marc Andreessen and Ben Horowitz, launched its third crypto-focused fund, Crypto Fund III, in June 2021. With $2.2 billion to invest, it is the firm's largest vertical-specific fund and the VC industry's largest crypto-related fund to date. Crypto Fund III will be co-led by Chris Dixon and Katie Haun, who also run Andreessen's cryptocurrency group.

The fund will focus on blockchain and digital asset start-ups, with investments ranging from early seed-stage projects to fully developed later-stage networks. Andreessen Horowitz has been investing in crypto assets since 2013 and is known for its early bets on companies like Facebook, Instagram, Lyft, and Pinterest. The firm's first crypto-focused fund was launched during the “crypto winter” in 2018, when the value of bitcoin declined by roughly 80% from its highs in 2017.

Crypto Fund III comes at another bearish moment for bitcoin. The cryptocurrency has lost about half of its value since April 2021, when it reached a high of around $60,000. Despite this volatility, Andreessen Horowitz remains optimistic about the potential of crypto to drive the next wave of computing innovation. The firm believes that crypto will not only transform finance but also all aspects of our lives, just as the internet did in its early days.

In addition to raising the fund, Andreessen Horowitz has expanded its crypto unit with several key hires. These include Anthony Albanese, who joined as Chief Operating Officer of a16z crypto, and Bill Hinman, a former director at the Securities and Exchange Commission, who will serve as an advisory partner. The firm has also added Tomicah Tillemann, a former senior advisor to President Joe Biden, as its Global Head of Policy. These hires aim to help translate crypto to the mainstream and navigate the regulatory landscape.

Andreessen Horowitz's investment in Coinbase

By the time Coinbase went public in April 2021, Andreessen Horowitz had invested in Coinbase eight different times from 2013 to 2020, including in every primary financing since their initial investment. They had built the biggest stake in the company, owning shares worth about $9.7 billion.

Coinbase's public debut was a watershed moment for the crypto industry, demonstrating the public market's appetite for crypto. The company closed its first day of trading at $328.28 a share, valuing the company at $85.8 billion. This made it Andreessen Horowitz's biggest exit yet.

Since the public listing, Andreessen Horowitz has sold or distributed to limited partners (LPs) more than half of its stake in Coinbase. The value of those sales and transfers totalled around $5 billion. As of March 31, 2022, Andreessen Horowitz's remaining stake in Coinbase was worth around $953 million.

Coinbase's success has been beneficial for the broader crypto ecosystem. The company has seen incredible growth in trading volume, with almost no investment in marketing. As of 2021, Coinbase had 56 million verified users and $223 billion in assets on its platform. Coinbase's public listing brought crypto a step closer to mainstream relevance in the global economy.

Andreessen Horowitz's crypto team

The crypto team at Andreessen Horowitz has seen some recent changes, with the addition of new advisers to help navigate the complex world of crypto regulations. These include Tomicah Tillemann, the former chair of the Global Blockchain Business Council and an adviser to the White House, who will serve as the global head of policy. The team has also added Bill Hinman, with experience at the SEC, and Brent McIntosh, a former US Treasury official, as advisers.

Arianna Simpson, a 30-year-old partner at Andreessen Horowitz, has also been making waves in the crypto space. Simpson, who previously worked at Facebook and BitGo, launched her own venture capital firm at the age of 24 to invest in blockchain and crypto companies. She has since joined forces with Ali Yahya, Katie Haun, and Chris Dixon to run the firm's crypto efforts. Simpson has highlighted the company's focus on "decentralized finance" and investments in crypto-related categories such as gaming.

In addition to its investments in blockchain startups and NFTs, Andreessen Horowitz has also made significant bets on the cryptocurrencies themselves. The firm's crypto arm has raised a massive $2.2 billion Crypto Fund III, signalling its commitment to the industry and its belief in the potential of crypto and blockchain technology. With this fund, the firm is hoping to find the next Coinbase or an even bigger success story.

Andreessen Horowitz's investment in blockchain startups

Andreessen Horowitz, the Silicon Valley venture capital firm, has been investing in blockchain startups for nearly a decade. In 2013, the firm led a $25 million funding round for Coinbase, a startup that positioned itself as the financial exchange of the future. This investment paid off, as Coinbase became the first major crypto company to go public in April, closing its first day of trading at $328.28 a share and valuing the company at $85.8 billion.

Since then, Andreessen Horowitz has continued to invest in blockchain startups, with a particular focus on crypto and web3 startups. In 2021, the firm announced its third crypto-focused fund, Crypto Fund III, totalling $2.2 billion. This fund is among the largest capital commitments to the crypto ecosystem in history and signals the firm's commitment to the industry. The fund will be managed by general partners Chris Dixon and Katie Haun, with a focus on supporting the "next generation of visionary crypto founders."

Andreessen Horowitz has stakes in several companies powering the recent NFT boom, such as OpenSea and Dapper Labs, the maker of NBA Top Shot. The firm has also invested in blockchain infrastructure startups like Dfinity and Uniswap, which is poised to be a major player in the Ethereum ecosystem. In addition, Andreessen Horowitz led a $36 million funding round for Mysten Labs, a crypto and blockchain infrastructure technology startup founded by four former Facebook engineers.

The firm's investments in the crypto and blockchain space go beyond just financial backing. Andreessen Horowitz has also introduced several new advisors to its crypto team, including Tomicah Tillemann, the former chair of the Global Blockchain Business Council, and Bill Hinman and Brent McIntosh, who have government and regulatory experience. These appointments indicate that the firm is preparing for potential future regulation in the crypto market and aiming to "translate crypto to the mainstream."

With its massive new fund and experienced team, Andreessen Horowitz is well-positioned to continue supporting innovation in the blockchain and crypto space, finding the next Coinbase, and driving the growth of the industry.

Andreessen Horowitz's investment in OpenSea

Andreessen Horowitz (also known as a16z) is an American venture capital firm founded in 2009 by Marc Andreessen and Ben Horowitz. The company has a history of investing in both early-stage start-ups and established growth companies across a range of industries, including cryptocurrency.

In July 2021, Andreessen Horowitz led a $100 million Series A funding round for OpenSea, a leading NFT marketplace. This investment valued OpenSea at $1.5 billion.

OpenSea is a platform that allows users to buy, sell, and trade non-fungible tokens (NFTs), which are unique digital assets stored on the blockchain. NFTs can represent a wide range of items, including digital art, collectibles, virtual land, and more.

The investment in OpenSea is a strategic move by Andreessen Horowitz to gain exposure to the rapidly growing NFT market. OpenSea has experienced significant growth and has become one of the leading platforms in the space, attracting a large number of users and facilitating millions of dollars in transactions.

By investing in OpenSea, Andreessen Horowitz gains access to the emerging NFT economy and the potential upside of this new asset class. The firm has a history of making successful investments in innovative companies, and its investment in OpenSea underscores its belief in the potential of blockchain technology and the broader cryptocurrency ecosystem.

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