Andreessen Horowitz

Most venture capital firms provide capital. Andreessen Horowitz built a coral reef. When Marc Andreessen and Ben Horowitz launched a16z in 2009, they modeled it not on traditional VC but on Creative Artists Agency—the Hollywood talent firm that wrapped services around its clients. The biological parallel is ecosystem engineering: constructing habitat that makes survival easier for everything living within it.

The firm maintains databases of recruiters, executives, engineers, and designers—functioning like cleaner wrasses that service multiple fish species at the same cleaning station. Portfolio companies tap this network for hires, introductions, and operational expertise. This isn't charity—it's mutualism. Each successful company strengthens the ecosystem, attracting better founders, which produces more successes, which deepens the talent pool. The $50 million Facebook investment in 2010 didn't just return capital; it created gravitational pull that drew Instagram, Airbnb, and Slack into the same orbit.

The numbers validate the strategy: $15 billion raised in 2025 (their largest fund), 18% of the US venture market, 1,076 portfolio companies generating 116 unicorns. Coinbase exemplifies the compounding returns—a $25 million Series B in 2013 grew to $9.7 billion at IPO. The Airbnb investment ($60 million in 2011) hit $47 billion at its 2020 debut. These aren't lucky bets. They're network effects captured through infrastructure.

But ecosystem engineering has vulnerabilities that pure k-selection avoids—a contrast explored in depth with Sequoia Capital's approach. A16z's $4.5 billion crypto fund—raised at the 2022 market peak—lost 40% within six months. Their $400 million Twitter investment under Musk had lost $288 million by late 2024. Jack Dorsey's criticism that 'Web3 will be owned by VCs like a16z, not the people' led to Marc Andreessen blocking him—a visible crack in the ecosystem narrative. When you engineer habitat around a thesis (crypto will reshape finance), you're exposed if the thesis fails.

The firm's 2025 'American Dynamism' fund ($1.2 billion for defense, space, and manufacturing) signals adaptive radiation into new niches as crypto winter persists. The coral reef survives by diversifying which species it hosts.