happen in the next ten, twenty, thirty years.Photograph by Joe PuglieseOn a bright October morning, Suhail Doshi drove to Silicon Valley in his parents Honda Civic, carrying a laptop with a twelve-slide presentation that was surely worth at least fifty million dollars. Doshi, the twenty-six-year-old C.E.O. of a data-analytics startup called Mixpanel, had come from San Francisco to Sand Hill Road in Menlo Park, where many of the worlds most prestigious venture-capital firms cluster, to pitch Andreessen Horowitz, the roads newest and most unusual firm. Inside the offices, he stood at the head of a massive beechwood conference table to address the firms deal team and its seven general partnersthe men who venture the money, take a seat on the board, and fire the entrepreneur if things go wrong.Marc Andreessen, the firms co-founder, fixed his gaze on Doshi as he disinfected his germless hands with a sanitizing wipe. Andreessen is forty-three years old and six feet five inches tall, with a cranium so large, bald, and oblong that you cant help but think of words like jumbo and Grade A. Two decades ago, he was the animating spirit of Netscape, the Web browser that launched the Internet boom. In many respects, he is the quintessential Silicon Valley venture capitalist: an imposing, fortyish, long-celebrated white man. (Forbess Midas List of the top hundred V.C.s includes just five women.) But, whereas most V.C.s maintain a casual-Friday vibe, Andreessen seethes with beliefs. Hes an evangelist for the church of technology, afire to reorder life as we know it. He believes that tech products will soon erase such primitive behaviors as paying cash (Bitcoin), eating cooked food (Soylent), and enduring a world unimproved by virtual reality (Oculus VR). He believes that Silicon Valley is mission control for mankind, which is therefore on a steep trajectory toward perfection. And when he so argues, fire-hosing you with syllogisms and data points and pre-refuting every potential rebuttal, hes very persuasive.Doshi, lean and quizzical in a maroon T-shirt and jeans, began his pitch by declaring, Most of the world will make decisions by either guessing or using their gut. They will be either lucky or wrong. Far better to apply Mixpanels analytics, which enable mobile-based companies to know exactly who their customers are and how they use their apps. Doshi rapidly escalated to rhetoricWe want to do data science for every single market in the worldthat would sound bumptious anywhere but on Sand Hill Road, where the young guy in jeans is obligated to astound the middle-aged guys in cashmere V-necks. Mediocre V.C.s want to see that your company has traction, Doshi told me. The top V.C.s want you to show them you can invent the future.If you have a crackerjack idea, one of your stops on Sand Hill Road will be Andreessen Horowitz, often referred to by its alphanumeric URL, a16z. (There are sixteen letters between the a in Andreessen and the z in Horowitz.) Since the firm was launched, six years ago, it has vaulted into the top echelon of venture concerns. Competing V.C.s, disturbed by its speed and its power and the lavish prices it paid for deals, gave it another nickname: AHo. Each year, three thousand startups approach a16z with a warm intro from someone the firm knows. A16z invests in fifteen. Of those, at least ten will fold, three or four will prosper, and one might soar to be worth more than a billion dollarsa unicorn, in the local parlance. With great luck, once a decade that unicorn will become a Google or a Facebook and return the V.C.s money a thousand times over: the storied 1,000x. There are eight hundred and three V.C. firms in the U.S., and last year they spent forty-eight billion dollars chasing that dream.Doshi had run the gantlet before. In 2012, he tracked down Andreessen and his equally if less splendidly bald co-founder, Ben Horowitz, at a Ritz-Carlton near Tucson. Then he pitched them in the lobby (having made sure that his parents Honda, which contained his father, was well out of sight). Doshi mentioned that hed become so dissatisfied with the incumbent database software that hed built his own. Andreessen later told me that this was like a cub reporter saying, I need to write the Great American Novel before I can really file this story. A16z gave Doshi ten million dollars, and he gave it twenty-five per cent of his company.Now he was back for more. He zipped through his slides: hundred-per-cent growth rate; head count doubling every six to nine months; and he still had all the money hed raised last time. As Andreessen drank an iced tea in two gulps and began to roam the room, Doshi called up a slide that showed his competitorsLocalytics, Amplitude, Google Analyticsgrouped into quadrants. Then he explained how hed crush each quadrant. I want to buy a machine-learning team, I want to buy cutting-edge server hardware, he said. Indicating his all-but-obliterated competitors, he added, I want to buy stuff no one here can afford. He jammed his hands in his pockets: questions?While entrepreneurs attack with historiographyThe great-man view of history is correct, and I am that great man!V.C.s defend with doubletalk. Youre definitely going to get funded! means But not by us. Who else is in? means Besides not us. And Im not sure I would ever use your product myself means So long! But the best V.C.s test the entrepreneurs mettle as well as their own assumptions. Andreessen gripped the back of his chair. So one way to describe what youre doing is a network effect, he said. More data gives you more customers, which allows you to build more services, which gives you more data, which allows you to get more customers, and you just turn the crank. Doshi thought this over and said, Sure! Andreessen grinned: hes a systems thinker, and hed grasped how Mixpanel fit into the system. After the pitch, he told me that Mixpanel is a picks-and-shovels business right in the middle of the gold rush.When a startup is just an idea and a few employees, it looks for seed-round funding. When it has a product that early adopters likeor when its run through its seed-round moneyit tries to raise an A round. Once the product catches on, its time for a B round, and on the rounds go. Most V.C.s contemplating an investment in one of these early rounds consider the same factors. The bottom seventy per cent of V.C.s just go down a checklist, Jordan Cooper, a New York entrepreneur and V.C., said. Monthly recurring revenue? Founder with experience? Good sales pipeline? X per cent of month-over-month growth? V.C.s also pattern-match. If the kids are into Snapchat, fund things like it: Yik Yak, Streetchat, ooVoo. Or, at a slightly deeper level, if two dropouts from Stanfords computer-science Ph.D. program created Google, fund more Stanford C.S.P. dropouts, because they blend superior capacity with monetizable dissatisfaction.Venture capitalists with a knack for the 1,000x know that true innovations dont follow a pattern. The future is always stranger than we expect: mobile phones and the Internet, not flying cars. Doug Leone, one of the leaders of Sequoia Capital, by consensus Silicon Valleys top firm, said, The biggest outcomes come when you break your previous mental model. The black-swan events of the past forty yearsthe PC, the router, the Internet, the iPhonenobody had theses around those. So whats useful to us is having Dumbo ears.* A great V.C. keeps his ears pricked for a disturbing story with the elements of a fairy tale. This tale begins in another age (which happens to be the future), and features a lowborn hero who knows a secret from his hardscrabble experience. The hero encounters royalty (the V.C.s) who test him, and he harnesses magic (technology) to prevail. The tale ends in heaping treasure chests for all, borne home on the unicorns back.At pitch meetings, Andreessen is relatively measured: he reserves his passion for the deal review afterward, when the firm decides whether to invest. Thats where he asks questions that oblige his partners to envision a new world. For the ride-sharing service Lyft: Dont think about how big the taxi market is. What if people no longer owned cars? For OfferUp: What if all this selling onlineeBay and Craigslistgoes to mobile? How big could it be? Ben Horowitz, who sits next to his co-founder at the head of the table, is an astute manager who quotes the rap lyrics of his friends Nas and Kanye West to inspire fearless thinkingbut he doesnt try to manage Andreessen. If you say to Marc, Dont bite somebodys fucking head off!, that would be wrong, Horowitz said. Because a lot of his value, when youre making giant decisions for huge amounts of money, is saying, Why arent you fucking considering this and this and this?In New York, we wouldnt call this quick.A16z was designed to be a full-throated argument about the future, a design predicated on its founders comfort with conflict. In 1996, when Horowitz was a Netscape product manager, he wrote a note to Andreessen, accusing him of prematurely revealing the companys new strategy to a reporter. Andreessen wrote back to say that it would be Horowitzs fault if the company failed: Next time do the fucking interview yourself. Fuck you. Ordinarily, relationship over. When he feels disrespected, Marc can cut you out of his life like a cancer, one of Andreessens close friends said. But Ben and Marc fight like cats and dogs, then forget about it. Two years later, when Netscape was floundering and forty per cent of its employees left, Horowitz announced that he was staying no matter what. Andreessen had never trusted anyone before, but he began to consider it. Their teamwork at a16z is complementary: Horowitz is the people-person C.E.O., and Andreessen is the farsighted theorist, the chairman. Yet Horowitz noted that Marc is much more sensitive than I am, actually. Hell get upset about my body languageGod damn it, Ben, you look like youre going to throw up when Im talking about this!Although Andreessen has been a board member of Facebook, Hewlett-Packard, and eBay, he doesnt take many board seats in a16zs portfolio companies, preferring to train his eyes on the horizon. Andreessen is tomorrows advance man, routinely laying out what will happen in the next ten, twenty, thirty years, as if he were glancing at his Google calendar. He views his acuity as a matter of careful observation and extrapolation, and often invokes William Gibsons observation The future is already hereits just not very evenly distributed. Jet packs have been around for half a century, but you still cant buy them at Target. To smooth out such lumps in distribution, Andreessen disseminates his views via every available podcast and panel discussion and CNN interview slot: hes a media soothsayer, Andreessen the Magnificent. He also tweets a hundred and ten times a day, inundating his three hundred and ten thousand followers with aphorisms and statistics and tweetstorm jeremiads. Andreessen says that he loves Twitter because reporters are obsessed with it. Its like a tube and I have loudspeakers installed in every reporting cubicle around the world. He believes that if you say it often enough and insistently enough it will comea glorious revenge. He told me, We have this theory of nerd nation, of forty or fifty million people all over the world who believe that other nerds have more in common with them than the people in their own country. So you get to choose what tribe or band or group youre a part of. The nation-states of Twitter will map the world.Mixpanel was emblematic of Silicon Valleys outsized worship of unicorns. At the companys deal review, Peter Levine, who sits on Doshis board, reported that the entrepreneur had e-mailed to say that hed love for his company to be valued at a billion dollarsan assessment that would set the price for the portion of it that a16z might now buy. However, Doshi would sell the firm ten per cent of his company for eighty million, suggesting a valuation of eight hundred million dollars. Andreessen said, The dogs are fucking jumping through the screen door to eat the dog food. And he hasnt done any marketing yet. And hes profitable!Horowitz exclaimed, How old is he, twenty-four? God damn it, lets give him all our money! A16z provided Doshi all his B-round fundingsixty-five million dollarsfor a further 7.5 per cent of the company, which was thus valued at eight hundred and sixty-five million dollars. Doshi was a little sorry that Mixpanel wasnt valued at a billion dollars, but he told me that he could wait: his business was growing so fast, and everyone was raising money so frequently in the current boom, that in six or twelve months well be a unicorn.Venture firms rarely do an entire follow-on round themselves, for fear of losing sight of a companys true market value; as Andreessen put it, You can be thinking your shit smells like ice cream. None of the half-dozen other firms that Doshi pitched last fall valued his company as highly as a16z did. But Andreessen applied a maxim from his friend and intellectual sparring partner Peter Thiel, who co-founded PayPal and was an early investor in LinkedIn and Yelp. When a reputable venture firm leads two consecutive rounds of investment in a company, Andreessen told me, Thiel believes that that is a screaming buy signal, and the bigger the markup on the last round the more undervalued the company is. Thiels point, which takes a moment to digest, is that, when a company grows extremely rapidly, even its bullish V.C.s, having recently set a relatively low value on the previous round, will be slightly stuck in the past. The faster the growth, the farther behind theyll be. Andreessen grinned, appreciating the paradox: the more they paid for Mixpanelaccording to Thiel, anywaythe better a deal theyd be getting.Most businesses dont work like this. At least, not yet.Silicon Valley, the fifteen-hundred- square-mile shelf an hour south of San Francisco, was called the Santa Clara Valley until the rise of the microprocessor, in the nineteen-seventies. It remains contested ground. Armies of startups attack every incumbent, with early employeesand sometimes even their lawyers and landlordstaking deferred compensation, in the hope that their options and warrants will pay off down the line. Yet workers loyalty is not to a company or even to an idea but to the iterative promise of the region. Uber is built on the efforts of thousands of people in the Valley, the investor Naval Ravikant said. On the back of the iPhone and Android and G.P.S. and battery technology and online credit-card payments, all stacked on themselves.V.C.s give the Valley its continuityand its ammunition. They are the arms merchants who can turn your crazy idea and your expendable youth into a team of coders with Thunderbolt monitors. Apple and Microsoft got started with venture money; so did Starbucks, the Home Depot, Whole Foods Market, and JetBlue. V.C.s made their key introductions and stole from every page of Sun Tzu to help them penetrate markets. And yet V.C.s maintain a zone of embarrassed privacy around their activities. They tell strangers theyre investors, or work in technology, because, in a Valley that valorizes the entrepreneur, they dont want to be seen as just the money. I say Im in the software industry, one of the Valleys best-known V.C.s told me. Im ashamed of the truth.At a hundred and eleven dollars a square foot, Sand Hill Road is Americas most expensive office-rental marketan oak-and-eucalyptus-lined prospect stippled with bland, two-story ski chalets constrained by an ethos of nonconspicuous consumption (except for the Teslas in the parking lot). Its a community of paranoid optimists. The top firms coperate and compete by turns, suspicious of any company whose previous round wasnt led by another top-five firm even as theyre jealous of that firm for leading it. They call this Schadenfreude-riddled relationship co-opitition. Firms trumpet their boldness, yet they often follow one another, lemming-like, pursuing the latest innovationpen-based computers, biotech, interactive television, superconductors, clean techoff a cliff.Venture capital became a profession here when an investor named Arthur Rock bankrolled Intel, in 1968. Intels co-founder Gordon Moore coined the phrase vulture capital, because V.C.s could pick you clean. Semiretired millionaires who routinely arrived late for pitch meetings, theyd take half your company and replace you with a C.E.O. of their choosingif you were lucky. But V.C.s can also anoint you. The imprimatur of a top firms investment is so powerful that entrepreneurs routinely accept a twenty-five per cent lower valuation to get it. Patrick Collison, a co-founder of the online-payment company Stripe, says that landing Sequoia, Peter Thiel, and a16z as seed investors was a signal that was not lost on the banks we wanted to work with. Laughing, he noted that the valuation in the next round of fundingfor a pre-launch company from very untested entrepreneurs who had very few customerswas a hundred million dollars. Stewart Butterfield, a co-founder of the office-messaging app Slack, told me, Its hard to overestimate how much the perception of the quality of the V.C. firm youre with mattersthe signal it sends to other V.C.s, to potential employees, to customers, to the tech press. Its like where you went to college.A venture firm musters its ammunitionsay, a fund of a hundred and fifty million dollarsby recruiting investors such as university endowments and pension funds to become limited partners, or L.P.s, in the fund. The firm invests the money for three or four years, then harvests the returns for the remainder of the funds ten-year term. In theory, V.C.s, like entrepreneurs, are motivated by delayed gratification. The standard fee is two and twenty: two per cent of the fund each year, and twenty per cent of the ultimate profits. (The top firms, including a16z, charge thirty per cent.) L.P.s expect returns equal to at least those theyd get in the stock market, plus an additional five per cent for the illiquidity of the investment. For top firms, the dream is 5x to 10x.At the moment, venture funding accounts for less than 0.3 per cent of the U.S.s G.D.P. Venture is often called a rounding error in the economy, Herbert Allen III, the head of the investment bank Allen & Company, said. But the bang for the buck is huge. And venture is a major source of the optimism that underlies the American myth. Venture speeds the cycle of American impatience: what exists is bad and what replaces it is gooduntil the new thing itself must be supplanted.Corporate culture, civic responsibility, becoming a pillar of societythese are not ventures concerns. Andy Weissman, a partner at New Yorks Union Square Ventures, noted that venture in the Valley is a perfect embodiment of the capitalist dynamic that the economist Joseph Schumpeter called creative destruction. Weissman said, Silicon Valley V.C.s are all techno-optimists. They have the arrogant belief that you can take a geography and remove all obstructions and have nothing but a free flow of capital and ideas, and that its good, its very good, to creatively destroy everything that has gone before. Some Silicon Valley V.C.s believe that these values would have greater sway if their community left America behind: Andreessens nerd nation with a charter and a geographic locale. Peter Thiel favors seasteading, establishing floating cities in the middle of the ocean. Balaji Srinivasan, until recently a general partner at a16z and now the chairman of one of its Bitcoin companies, has called for the ultimate exit. Arguing that the United States is as fossilized as Microsoft, and that the Valley has become stronger than Boston, New York, Los Angeles, and Washington, D.C., combined, Srinivasan believes that its denizens should build an opt-in society, ultimately outside the U.S., run by technology.The game in Silicon Valley, while it remains part of California, is not ferocious intelligence or a contrarian investment thesis: everyone has that. Its not even wealth: anyone can become a billionaire just by rooming with Mark Zuckerberg. Its prescience. And then its removing every obstacle to the ferocious clarity of your vision: incumbents, regulations, folkways, people. Can you not just see the future but summon it?Marc Andreessen mentions Thomas Edison often, his family never. When he was growing up, outside the no-stoplight town of New Lisbon, Wisconsin, his father, Lowell, was a sales manager for a seed company called Pioneer Hi-Bred International, and his mother, Pat, worked in customer service at Lands Endbut I didnt get that information from him. A friend who knows Andreessen well told me, Weve never had a conversation about his parents or his brotherall he said was They didnt like me, and I didnt like them all that much, either.The few details Andreessen let slip to me suggested a climate of antiquity, superstition, frustration, and penury. The natural state of human beings is to be subsistence farmers, and that was my expectation, he said, adding that his world was Scandinavian, hard-core, very self-denying people who go through life never expecting to be happy. The family telephone was a party line, and the bathroom at his relatives farm was an outhouse. Everyone believed in dowsing and the weather reports in the Farmers Almanac. One winter, with money tight, his father decided to stop paying for gas heat, and we spent a great deal of time chopping fucking wood. The local movie theatre, one town over, was an unheated room that doubled as a fertilizer-storage depot; Andreessen wore a puffy Pioneer Hi-Bred coat to watch Star Wars while sitting on the makings of a huge bomb. He had to drive an hour to find a Waldenbooks, in La Crosse; it was all cookbooks and cat calendars. So he later saw Amazon as a heroic disseminator of knowledge and progress. Screw the independent bookstores, he told me. There werent any near where I grew up. There were only ones in college towns. The rest of us could go pound sand.Andreessens vision of the future, and of his escape route, came from television. He told me, KITT, the car in Knight Rider, was a computer that could analyze a poison-gas attack. The car was magicbut now you can actually do all those things. A new car isnt KITT, but it does have all the maps and all the music in the world, and it talks to you. Even the transporter beam in Star Trek basically makes sense if you understand quantum entanglement. People are composed of quantum elements, so there is a path!Something of the transporter beam clings to Andreessen, a sense that he just rematerialized from a city on the edge of forever. Hes not great at the basics of daily life: directions confound him, because roadways arent logical, and hes so absent-minded about sunglasses that he keeps a reload station with nine pairs on his hall table. Perhaps Edison haunts his conversation because Andreessen is a fellow-tinkerer, except that his gadgets are systems and platforms, and his workshop is his own mind. He regularly reprograms his appearance and deportmenthis user interfaceto suit his present role, and friends refer to chapters in his life as versions of an operating system: Marc 1.0, Marc 2.0, and so on. A charismatic introvert, Andreessen draws people in but doesnt really want them around. Though he has a crisp sense of humor, its rarely deployed at his own expense. He hates being complimented, looked at, or embraced, and has toyed with the idea of wearing a T-shirt that says No hugging, no touching. He doesnt grasp the protocols of social chitchat, and prefers getting a memo to which he can e-mail a response, typing at a hundred and forty words a minute. He didnt attend Netscapes twentieth-anniversary celebration, because it combined two things from which he recoils: parties and reminiscing.Yet hes also energetic and decisive, which makes him a valued counsellor. In 2006, Yahoo! offered to buy Facebook for a billion dollars, and Accel Partners, Facebooks lead investor, urged Mark Zuckerberg to accept. Andreessen said, Every single person involved in Facebook wanted Mark to take the Yahoo! offer. The psychological pressure they put on this twenty-two-year-old was intense. Mark and I really bonded in that period, because I told him, Dont sell, dont sell, dont sell! Zuckerberg told me, Marc has this really deep belief that when companies are executing well on their vision they can have a much bigger effect on the world than people think, not just as a business but as a steward of humanityif they have the time to execute. He didnt sell; Facebook is now worth two hundred and eighteen billion dollars.Andreessens range of reference extends from Ibn Khaldun to South Park, yet he approaches new topics as if starved, eating through mens fashion or whiskey-making or congressional politics until it has yielded every micronutrient. In a tweetstorm about the question of net neutrality, he observed that anyone who took a position should be versed in the history, technology, and economics of backbones, interconnection agreement, peering, CDNs, caching, colocation, current and future telco and cable business models including capex and opex models, rate caps, cost of capital, return on investment, as well as a dozen other equally abstruse matters. He coyly noted that no one, himself included, understood them allthen stated his position. Andreessens learning fuses the idiosyncrasy of the autodidact with the thoroughness of what programmers call depth-first search. I could never tolerate not knowing why, he said. You have to work your way back to figure out the politics, the motivations. I always stop when I get to evolutionary psychology, and why we have tribesoh, O.K., were primates cursed with emotions and the ability to do logical thinking. He keeps rediscovering that were australopithecines, and keeps hoping to transform us into Homo habilis: man the tool user, able man.To this end, he addresses any topic, such as Googles purchase of the thermostat maker Nest, by launching a dialectics1) Either Nest is the most amazing company ever, or 2) Larry Page acqui-hired Tony Fadell for $3.2 billion and got a thermostat business on the sidewhose synthesis is often that the thesis and the antithesis were simplistic (Or, maybe Google has a larger plan for automating the home) or irrelevant (Whatever, whatever, we dont own it, so who cares?). Often, he discourses at such lucid length that his cheeks redden and he must pause for breath. If you seize the interval to demonstrate a basic grasp of his argument, hell say Ex-zact-ly, with a pleased smile, and upload another tranche. What saves him from pompous know-it-all-dom, most of the time, is this eagerness to communicate.He turns to theory the way a drinker turns to the minibar. But Horowitz told me that every once in a while Andreessen will get all Wisconsin on you, sticking up for his people. When we looked at an Internet pawnshop, people here said, Its immoral, and Marc went bananas. He said, If youve got no fucking money, and you need to pawn your watch to pay for your kids to eatyou think thats morally fucking wrong because it offends your sensibilities, you rich motherfuckers? He knew that guy who was pawning his watch because hed missed the harvest, or whatever. Or we saw an Uber-for-private-jets thing, or some wine thing that came through, and he just got incensed: We didnt start the firm for rich people to buy hundred-dollar bottles of wine or to fly around on fucking private jets! He reminds me of Kanye, that level of emotional intensityhis childhood was so intensely bad he just wont go there.One afternoon, Alexis Ringwald, the C.E.O. of LearnUp, a job-training startup that has worked with Staples and Old Navy, stood in a16zs conference room, all poise and smile. I like to launch movements to tackle huge problems, she said, launching into her presentation.Start at the beginning, where you grew up, Ben Horowitz said. A16z had made a small seed investment in Ringwalds company, but most of the general partners, who were about to tell her whether she was ready for an A round, didnt know much about her. Horowitz also routinely forces a founder to abandon her script and regroup. Its a stress test intended to elicit biography, resilience, and the real story.How many times do I have to tell you to stay inside the bowl?Ringwald, who is thirty-one, blinked, then shifted smoothly to an engaging account of her early years, her work interviewing people on the unemployment line, and how shed eventually realized that the countrys biggest gulf is between those who have the basic skills to be employableshowing up on time, dressing neatlyand those who dont. So its a modern My Fair Lady sort of thing? Horowitz asked, ingenuously. Ringwald crisply noted that her process triples an applicants chance of getting a job, and that eighty-two per cent of LearnUps trainees outperform their fellow-workers. Horowitz and Andreessen nodded: she could handle the pressure. Afterward, Horowitz told me, My big conclusion was shes a legit Pied Piper, with charisma and will and fury.Pitch meetings are minefields. If a V.C. asks you, When you get to a hundred engineers, are you worried about the company culture or excited?, the correct answer is A hundred? I want a thousand! Reid Hoffman, a V.C. at Greylock Partners who co-founded LinkedIn, told me, I look to see if someone has a marine strategy, for taking the beach; an army strategy, for taking the country; and a police strategy, for governing the country afterward.A16z wants to learn if the founder has a secreta novel insight, drawn from personal experience, about how the world could be better arranged. If that new arrangement is 10x better, consumers might be won over. Balaji Srinivasan contributed the concept of the idea maze: you want the entrepreneur to have spent years thinking her idea intoand out ofevery conceivable dead end. Entrepreneurs want to raise money from us, Andreessen told me, so the natural thing when we say What if you did this? is to tell us what we want to hear. But we dont want to hear what we want to hear. Its a delight when they look at you with contemptYou idiotand then walk you through the idea maze and explain why your idea wont work. Such tests help a16z determine whether the founder is a mercenary who wants to sell the company within four years, which will cap a16zs return at 5x, or a missionary, determined to change the world. At the same time, Andreessen said, were not funding Mother Teresa. Were funding imperial, will-to-power people who want to crush their competition. Companies can only have a big impact on the world if they get big.Ringwald, back into her planned remarks, promised bigness: LearnUp will transform employment in America. We can unleash human potential and move the needle on the G.D.P. Andreessen said, Question: This is a known problem. Why do companies not just do this themselves, once they see that it works? Ringwald replied, Well keep on differentiating by moving fast and collecting more data on what companies need now.Then a general partner named Chris Dixon asked, Is it a marketplace or an enterprise company? Marketplace companies sell to consumers; enterprise companies sell to other businesses. Clearly perplexed by the distinction, Ringwald said that she was signing up workers as well as companies. Everyone became a shade more remote.Afterward, Andreessen told his colleagues, She didnt really answer Chriss question. If its marketplace, its defensible; if its enterprise, she can be undercut. If Ringwalds customers were the workers, who would keep using LearnUp as they moved from job to job, she could create a network effect. If her customers were actually the companies, they could start doing the training themselvesor another startup could. A16z views marketplace and enterprise companies very differently. The firm invests early with enterprise, but waits with consumer companies, because they tend to take offsuddenly, everyone wants to be on Instagramor fail fast. Its a risk-averse way to embrace risk. In 2013, a16z passed on the A round of Oculus VR (waiting to see if it could resolve the nausea issue that has plagued virtual-reality systems) and came in on the B, six months later. It got the same ten per cent of the company it could have had in the Abut it paid thirty million dollars instead of six million. The internal rationale for this expensive de-risking is We paid up for certainty.The partners began to discuss how LearnUp might be valued. Valuation, particularly in a companys early rounds, often derives less from spreadsheets than from market forceswhat are other firms offering?and the What ifs of mental modelling. Does the companys traction, leadership team, and total addressable market call to mind a Pinterest, or does it feel more like a ShoeDazzle? One partner suggested that LearnUp was a ten on thirtyten million dollars should buy a third of the company, which would then be valued at forty million. Its more like ten on fifteen or twenty, Horowitz said, cutting the companys value in half. Or six on twelve, Andreessen said, whittling it further. Soon after the meeting, Ringwald turned LearnUp into an enterprise company.Most venture firms operate as a guild; each partner works with his own companies, and a small shared staff helps with business development and recruiting. A16z introduced a new model: the venture company. Its general partners make about three hundred thousand dollars a year, far less than the industry standard of at least a million dollars, and the savings pays for sixty-five specialists in executive talent, tech talent, market development, corporate development, and marketing. A16z maintains a network of twenty thousand contacts and brings two thousand established companies a year to its executive briefing center to meet its startups (which has produced a pipeline of deals worth three billion dollars). Andreessen told me, We give our founders the networking superpower, hyper-accelerating someone into a fully functional C.E.O. in five years.The firms fourteen-person deal team also enables it to rapidly assess any new technology, making a16z a kind of Iron Man suit for Andreessen as he pursues his flights of fancy. Jim Breyer, who led Facebooks first venture round at Accel Partners, told me, I spend most of my time trying to connect the dots for what the future will look like in five to seven years, but I dont believe I scale as well as Marc and Ben and their team. Theyve moved into next-gen agricultural products and wearables and drone software, where a lot of us dont have expertise or networks.Andreessen and Horowitz launched the firm in 2009, when venture investment was frozen by the recession. Their strategy was shaped by their friend Andy Rachleff, a former V.C. He told them that hed run the numbers and that fifteen technology companies a year reach a hundred million dollars in annual revenueand they account for ninety-eight per cent of the market capitalization of companies that go public. So a16z had to get those fifteen companies to pitch them. Deal flow is everything, Andreessen told me. If youre in a second-tier firm, you never get a chance at that great company. A leading investment banker who has taken numerous software companies public told me, I put ninety per cent of my effort into seeking out deals from the top eight venture firms, ten per cent into the next twelve, and zero per cent into all the rest.The dirty secret of the trade is that the bottom three-quarters of venture firms didnt beat the Nasdaq for the past five years. In a stinging 2012 report, the L.P. Diane Mulcahy calculated, Since 1997, less cash has been returned to V.C. investors than they have invested. The truth is that most V.C.s subsist entirely on fees, which they compound by raising a new fund every three years. Returns are kept hidden by nondisclosure agreements, and so V.C.s routinely overstate them, both to encourage investment and to attract entrepreneurs. You cant find a venture fund anywhere thats not in the top quartile, one L.P. said sardonically. V.C.s also logo shop, buying into late rounds of hot companies at high prices so they can list them on their portfolio page.When a16z began, it didnt have even an ersatz track record to promote. So Andreessen and Horowitz consulted on tactics with their friend Michael Ovitz, who co-founded the Hollywood talent agency Creative Artists Agency, in 1974. Ovitz told me that hed advised them to distinguish themselves by treating the entrepreneur as a client: Take the long view of your platform, rather than a transactional one. Call everyone a partner, offer services the others dont, and help people who arent your clients. Disrupt to differentiate by becoming a dream-execution machine.Believing that founders make the best C.E.O.slook at Intel, Apple, Oracle, Google, FacebookAndreessen and Horowitz recruited only general partners whod been founders or run companies. Then they began constructing the illusion of authority, taking offices on Sand Hill Road and filling them with paintings by Robert Rauschenberg and Sol LeWittanother page from the book of Ovitz, who commissioned a Roy Lichtenstein painting for C.A.A.s lobby that was so large the firm had to leave it behind when it moved. They were studiously punctual (partners are fined ten dollars for each minute theyre late to a pitch), used glassware rather than plastic, and said no quickly and explained why (unless the reason was doubts about the entrepreneur) in a handwritten note. And, while most V.C.s were publicity averseSequoias slogan was The entrepreneurs behind the entrepreneursa16z banged the drum to draw startups. The tech publicist Margit Wennmachers built an eight-person marketing department and helped to orchestrate stories in Forbes and Fortune.They all lead back to this ball of yarn.Andreessen and Horowitz believed that it would take them years to get great deal flow. So instead of fighting for A-round financingsthe most competitive round, because its when you can buy the largest chunk of an up-and-coming companythey planned to make seed investments in eighty startups. They wouldnt take the customary board seats (otherwise, theyd each be sitting on forty boards), but theyd help all eighty companies and then lead the A round for the twelve best.The strategy had flaws. Entrepreneurs want V.C.s on their boards, and so do L.P.s: thats how you really learn a company. The firm would be sending a huge negative signal about companies it didnt reinvest inhardly an entrepreneur-friendly stance. Furthermore, by making so many investments, a16z would create significant opportunity costs. In its first year, it put two hundred and fifty thousand dollars into a company called Burbn, which soon pivoted and became Instagrambut a16z couldnt increase its share, because it had also taken a position in a short-lived photo app called PicPlz. Though the firm made 312x when Facebook bought Instagram, the huge multiple amounted to only seventy-eight million dollars. Elizabeth Obershaw, a managing director at Horsley Bridge, a prominent L.P. that invested in a16z after some debate, told me, Our list of cons was that we didnt think their original model would work at all. The pros were Marc and Benwe decided they were learners and adapters and would realize the model wasnt workable fast enough to fix itand an industry that was ripe for reinvention.They learned fast. After a16z raised a three-hundred-million-dollar fund and opened shop, in July, 2009, it did a lot of seed rounds, but it also spent fifty million dollars to buy three per cent of Skype. Two years later, Microsoft bought Skype, and the investment returned 4x. Andreessen believed that everyone had underestimated the size of the Internet market, so in 2010, after raising a much bigger second fund, the firm spent a hundred and thirty million dollars to acquire shares of Facebook and Twitter at unprecedented valuations. Other V.C.s sniped that a16z was trying to buy its way in: Skype was an established company, not a startup, and the Facebook and Twitter deals were mere logo shopping. But, as Ron Conway, Silicon Valleys leading angel investor, noted, In twenty-four months, Andreessen Horowitz was the talk of the town. The firm won a hundred-million-dollar A round for the coding company GitHub, which Conway called the most hotly contested deal in five years. Chris Wanstrath, GitHubs co-founder and C.E.O., said that a16zs services were a major attraction: Its like a buffetthey offered a bunch of great dishes, and we wanted to sample them all.After six years, Andreessen believes, a16z is meetingand winningenough new clients to place it comfortably in the top three V.C. firms. (This is not far off from the consensus in the Valley.) Its first fund has already returned 2x, and contains such powerhouses as Slack and the identity-management company Okta. The funds internal rate of return, a calculation of annualized profit, is fifty per cent, which places it very high among funds raised in 2009. (Sequoias rate for its corresponding fund is sixty-nine per cent.) The firms second fund includes Pinterest and Airbnb, and its third fund includes Zenefits, GitHub, and Mixpanel; both funds, on paper, are well into the black. A respected L.P. of the firm told me, Theyre one of our top performers. Yet Andreessen cautioned, We still have a lot to prove on returns. I wouldnt be comfortable saying were No. 1 until ten years have passed, maybe fifteen. Until then, its Schrdingers cat, and Ive got really good arguments on why the cats are both alive and dead.At Andreessens wedding, in 2006, Ben Horowitz said in his toast that the man hed long known was grouchy Marc, because hed gone through his whole life without anyone understanding him, being all by himself. No one had understood him in his farm town, no one had understood him in Silicon ValleyHell, I do not understand him. But now, at last, he was happy Marc, because hed found someone who totally gets him: the bride, a lecturer in philanthropy at Stanfords business school named Laura Arrillaga-Andreessen.In December, Andreessen invited me to their house in Atherton, five minutes from a16zs office, to watch television. He and Laura live in a modern, art-filled, nine-thousand-square-foot villa built in a style that she calls Northern California pastiche. The ceilings are scaled to Andreessens Brobdingnagian proportions, and everything is majestic, minimal, and new. The toilet in the powder room is so visionary, and the surrounding dimmer lights so flattering, that I had to study it for some time to figure out how it flushed.Arrillaga-Andreessen brought the couples dinners into the living room and placed them on matching Costco TV tables. The omelettes and Thai salads that their chef had prepared earlier had been freshly reheated (they have three microwaves, so their food will always be ready at the same time). Andreessen stroked her arm and beamed: Hello, gorgeous!Hello, my darling! she replied. Then she gave me a dramatic hug, as we hadnt seen each other since the previous day. Arrillaga-Andreessen is a tall, ethereal-seeming, yet effusive woman. When the couple met, in 2005, at a New Years Eve dinner thrown by the leading investor in eHarmony, they talked for six and a half hours. She told me that Andreessen satisfied most of the criteria on her checklist: he was a genius, he was a coder, he was funny, and he was bald. (I find it incredibly sexy to see the encasement of a cerebrum, she explained.) For his part, Andreessen felt that she was spectacular! My biggest concern was that she wanted to live a jet-set life. In one of the seventeen e-mails he sent her the next day, he asked, Whats your ideal evening? She responded, Stay home, do e-mail, make an omelette, watch TV, take a bath, go to bed. Before their second date, he delivered what she calls a twenty-five-minute monologue on why we should go steady, with a full intellectual decision tree in anticipation of my own decision tree. They were married nine months later. In her and her father, John, a billionaire Silicon Valley developer, Andreessen seems to have found a replacement family. Laura showed me a photograph of the two men side by side, both bald, self-made, and magisterial: Quite two peas in a pod.After some TV time together, the couple reads in bed, so that, she says, I can fall asleep holding my beloved. (She invariably refers to her husband as my beloved, rather than Marc.) I ask him questions about things I got curious about during the day, so every night Im going to sleep with a human Wikipedia that can go deeper and deeper and deeper, link upon link. In the past week, we talked about all the hardware components of a mobile phone, how binary code works, what might happen with drone regulation, and whether Putin is using Ukraine as a distraction from the financial crisis in Russia. Once shes dozed off, Andreessen returns to work in his home office, where, like a recharging cell phone, he gains energy through the night.He pushed a button to unroll the wall screen, then called up Apple TV. We were going to watch the final two episodes of the first season of the AMC drama Halt and Catch Fire, about a fictional company called Cardiff, which enters the personal-computer wars of the early eighties. The shows resonance for Andreessen was plain. In 1983, he said, I was twelve, and I didnt know anything about startups or venture capital, but I knew all the products. He used the school librarys Radio Shack TRS-80 to build a calculator for math homework. In 1992, as an undergraduate at the University of Illinois at Urbana-Champaign, he neglected his jobwriting Unix code for $6.85 an hourto team with another programmer to create Mosaic, the first graphical browser for the Web. After graduating, he moved to Silicon Valley, where he and a volatile serial entrepreneur named Jim Clark launched Netscape, to make the Internet available not just to scientists but to everyone. John Doerr, the V.C. who funded their A round, said that the genius of their browser was that it was like putting photos on the menu at Howard Johnson. You didnt need to know the language; you could just point. The story underlying that story, Arrillaga-Andreessen told methe secretwas that Netscape was based on my beloveds own inability, as a child, to access knowledge in a small town.Netscape Navigator, released in 1994, quickly claimed more than ninety per cent of the browser market, and Andreessen predicted that the Web would make operating systems such as Microsofts Windows irrelevant. When the company went public, in 1995, its stock rocketed from twenty-eight dollars a share to seventy-five dollars, and Andreessen was soon on the cover of Time, barefoot on a throne. But Marc 1.0 was very much in beta. Having given up coding, his first love, to manage coders, he scarfed Pepperidge Farm Nantuckets and Honeycomb cereal straight from the box, skipped meetings, and blazed up without warning. Youd see him vibrating, and it would inspire a combination of excitement and terror, Jason Rosenthal, a manager whom Andreessen actually liked, recalled. A favorite Andreessen response to underlings confusion was There are no stupid questions, only stupid people. Jim Barksdale, the companys C.E.O., said, Id tell Marc after meetings, You dont have to tell a dumb sumbitch hes a dumb sumbitch. Andreessen told me, I needed Netscape to work, it had to workit was my one-way doorso I was absolutely intolerant of anything that got in the waymeaning, he clarified, people. He could never relax: I am very paranoid. And the down cycle hurt a lot more than the up cycle felt good.The down cycle began when Microsoft bundled its own browser with its operating system, making it the nations browser of convenience, if not of choice. Netscape shifted from marketplace to enterprise, and began selling browser and server software, but it was fortunate to get bought by AOL, in 1999, for ten billion dollars. Peter Currie, the companys C.F.O., said, We made a difference, we invented cookies and pioneered downloading software from the Internet, yet Netscape is an asterisk in business history. Maybe the best way to think about it is as a classic tech story: a company creates, invents, succeedsand gets bypassed.In the first Halt and Catch Fire episode, Cardiffs entrepreneurs go to Comdex, the big trade show, and discover that another company has stolen their idea and beaten them to market. In response, Gordon, the hardware engineer, removes the interactive operating system from their Cardiff machinea system designed by Cameron, a punk female software prodigyand slots in Microsofts dos, which makes the machine I.B.M.-compatible, viable, and dull. It was an excruciating capitulation, but Andreessen nodded evenly: This was Microsofts moment, and Gordon is rightthey need to live to fight another day. But... He pointed at the screen, where Apples Macintosh was making its dbut at the trade show. Hello, Im Macintosh, the machine said. Andreessen laughed and continued, They were doomed from the start, because Apple in Cupertinoin Silicon Valleyhad spent three years building that. Ive been totally determined to be on the other side of that dynamic by being here, because success in software follows a power-law distribution. Its not Coke and Pepsi and a bunch of others; its winner take all. Second prize is a set of steak knives, and third prize is youre fired.In the season finale, Cameron launches her own startup. As Andreessen watched her manage her coders, he said, softly, The best scenes with Cameron were when she was alone in the basement, coding. I said I felt that she was the least satisfactory character: underwritten, inconsistent, lacking in plausible motivation. He smiled and replied, Because shes the future.In Why Software Is Eating the World, a widely invoked 2011 op-ed in the Wall Street Journal, Andreessen put the most optimistic spin on Silicon Valleys tendencies. The article proclaimed that tech companies are consuming vast swaths of the economy, from books and movies to financial services to agriculture to national defensewhich Andreessen saw as the healthful scavenging of a carrion way of life. On Twitter, he pursued the theme: Posit a world in which all material needs are provided free, by robots and material synthesizers.... Imagine six, or 10, billion people doing nothing but arts and sciences, culture and exploring and learning. What a world that would be, particularly as technological progress is precisely what makes a strong, rigorous social safety net affordable.Andreessens telepathic methodextrapolating the future from current trendsmay be the best available, but it has had doubtful results. Of the eighteen firms that V.C.s valued at more than a billion dollars in the heady days of 1999-2000, eleven have gone out of business or have been liquidated in fire sales, including @Home, eToys, and Webvan. A16z bought into Zulily, an online marketer, at a valuation of a billion dollars; it soared to a market capitalization of five billion dollars, and has since slumped to $1.3 billion. Another billion-dollar a16z company, the bargain-shopping site Fab, recently sold for about thirty million dollars. On the other hand, the firm wrote off the gaming company Slack to zeroand then it became an office-messaging app thats now valued at $2.8 billion.The random, contingent way that the future comes to pass is a source of endless frustration in the Valley. Sam Altman, the president of the startup incubator Y Combinator, notes that his early investment in Stripe is now worth, on paper, more than 2,000x. So ninety-seven per cent of my returns from 2010 and 2011 are concentrated in one investment, which I could easily have missed, he said. I only let myself think about this sort of thing on vacation, because if I acknowledged that I was wasting more than ninety per cent of my timewhich is true, from an economic perspectiveI couldnt get through my days.The key to investing, Andreessen contends, is to be aggressive and to fight your instinct to pattern-match. Breakthrough ideas look crazy, nuts, he said, adding, Its hard to think this wayI see it in other peoples body language, and I can feel it in my own, where I sometimes feel like I dont even care if its going to work, I cant take more change. Andreessen believes that the major barrier to change is sociological: people can embrace only so many new ideas at once. O.K., Google, O.K., Twitterbut Airbnb? People staying in each others houses without there being a lot of axe murders?A16z passed on Airbnbs A round in 2009. Reid Hoffman, the Greylock V.C., who led that round, and who is a friend of Andreessens, said, Once something like Airbnb gets going, Marc can get a very good sense of it, of the economic systembut hes not necessarily as good at the psychology of why it would get going in the first place.Brian Chesky, Airbnbs co-founder and C.E.O., told me, In 2011, when we were starting to get some traction, Marc and Ben did a one-eighty and were very humble. Marc said he now saw it through the lens of eBay: buying stuff from strangers. A16z led Airbnbs B round. Soon afterward, the company was battered by headlines about renters who trashed a San Francisco home. It wasnt axe murders, but, Chesky said, It was a P.R. nightmare. We had just expanded from being ten people living in a three-bedroom apartment and we had no idea how to be a billion-dollar company. Marc came to our office at midnight and read the letter Id written to our community about the Airbnb Guarantee, and the two changes he made changed the company forever. Id said we guarantee five thousand dollars for property damage, and he added a zero, which seemed crazy. Andreessen also added the proviso that claimants would have to file a police report, which he correctly believed would discourage scam artists. And he told me to add my personal e-mail address. He gave us permission to be bold.In venture, its not batting average that matters; its slugging average. Boldness is all. When Google Glass appeared, a16z joined a collective to seek out investments, and Andreessen declared that, without the face shield, people are going to find they feel, basically, naked and lonely. Google withdrew the product in January. But, he would argue, so what? His thesis is that such a16z failures as Fab and Rockmelt and Digg and Kno are not merely a tolerable by-product of the risk algorithm but a vital indicator of it. Its fine to have a lousy record of predicting the future, most of the time, as long as when youre right youre really right. Between 2004 and 2013, a mere 0.4 per cent of all venture investments returned at least 50x. The real mistakes arent the errors of commission, the companies that crashall you can lose is your investmentbut those of omission. There were good reasons that a16z passed on buying twelve per cent of Uber in 2011, including a deadline of just hours to make a decision. But the firm missed a profit, on paper, of more than three billion dollars.The beauty of betting on risky technologies is that youre sometimes proved right, eventuallyperhaps well all feel naked without Google Glass 3.0. When reverses occur, Andreessen tends to believe that he wasnt wrong so much as overly prescient. Yet, while he professes intellectual comfort with being wrong, he never mentions Ning, a social-networking company that he co-founded in 2004, because, as he conceded when I asked about the elision, It didnt do great. And he can be touchy about criticism. At one Q. & A. I attended, when the interviewer read him a snarky quote from Sam Biddle, a writer who worked for the gossip site Valleywag, Andreessen made a doobie-smoking gesture and plunged an imaginary needle into his vein to suggest the quality of Biddles thinking. Being the public face of venture means that you can be challenged on multiple fronts: even as you philosophize about ushering in a new age of democracy, you also have to make money for your L.P.s. And, while the ideal startup advances both goals, most, in truth, advance neither. The V.C. Bryce Roberts told me, Its an ego game, where you want to believe youre changing the world. But how can you write a check to Fab and believe that giving people discounted tchotchkes is changing the world?You two are fired as security guards. Now gather up your things and escort each other from the building.In 1999, Andreessen and Horowitz started Loudcloud, an early cloud-computing service that booked thirty-seven million dollars in contracts in its first nine months. Andreessen, meanwhile, was becoming Marc 2.0. He shed thirty pounds, started wearing Ermenegildo Zegna suits, and traded in his red Mustang for a white Mercedes. Marc 1.0 was Jim Clark, Andreessen told me, referring to his impulsive co-founder. Marc 2.0 was trying to get as polished as possible, more socialized. And Marc 3.0 is a combo. The goal is not to be elegant but to be blunt enough that theres no confusion. I learned the skills from reading all of Caros L.B.J. books.The dot-com crash hit Loudcloud hard, and, in 2002, it pivoted to become a software company with a new name: Opsware. In 2007, after years of slogging, Andreessen and Horowitz sold the company for $1.6 billion. Andreessen says that the tech crash scarred him: The overwhelming message to our generation in the early nineties was Youre dirty, youre all about grungeyou guys are fucking losers! Then the tech boom hit, and it was We are going to do amazing things! And then the roof caved in, and the wisdom was that the Internet was a mirage. I one hundred per cent believed that, because the rejection was so personalboth what everybody thought of me and what I thought of myself. I was not depressed, but I was growly. In retrospect, he concluded, we were five or six years too early.Peter Thiel, who is four years older than Andreessen, observed that the late nineties, for Gen Xers in Silicon Valley, was an experience as powerful as the late sixties was for the younger boomers. The sixties was a transformative moment that got short-circuited by Nixon, and, for Marc, the ninetieswhen Netscape was iconic, and he was deeply living the belief that technology was going to inspire liberalization everywherewas short-circuited by the super-powerful bust and return of the old economy. But Marc is very tenacious.Andreessen said he learned that, while technology improves steadily, psychologically theres no middle groundthe plane is always headed straight up or straight down. Recognizing that he was a poor manager, and needing to buffer those emotional and financial swings, Andreessen saw that the obvious next move was a portfolio of investments. In 2003, he and Horowitz began angel investing, separately and then together; they put ten million dollars into fifty companies, including Facebook, Twitter, and LinkedIn. Then Andreessen began pushing to start a venture firm. I always thought the entire venture thing was incredibly cool, he told me. Going to Kleiner Perkinsthe firm that funded Netscapewith the high ceilings, the markers on the wall of all the great companies theyd I.P.O.d, Larry Ellison walking through, and, at 11 a.m., the biggest buffet youve ever seen, at a time when I was eating at Subway? It was the closest thing to a cathedral for nerds. Mark Zuckerberg told me, When Marc started Andreessen Horowitz, I asked him why he didnt start another company instead, and he said, It would be like going back to kindergarten.A16z was designed not merely to succeed but also to deliver payback: it would right the wrongs that Andreessen and Horowitz had suffered as entrepreneurs. Most of those, in their telling, came from Benchmark Capital, the firm that funded Loudcloud, and recently led the A rounds of Uber and Snapchata five-partner boutique with no back-office specialists to provide the services theyd craved. We were always the anti-Benchmark, Horowitz told me. Our design was to not do what they did. Horowitz is still mad that one Benchmark partner asked him, in front of his co-founders, When are you going to get a real C.E.O.? And that Benchmarks best-known V.C., the six-feet-eight Bill Gurley, another outspoken giant with a large Twitter following, advised Horowitz to cut Andreessen and his six-million-dollar investment out of the company. Andreessen said, I cant stand him. If youve seen Seinfeld, Bill Gurley is my NewmanJerrys bte noire.A16zs services model made a strong impression on Sand Hill Road. Andreessen caused us to up our game on the marketing side, Sequoias Doug Leone told me. Younger founders pay attention to media, and we dont want to be de-positioned. Sequoia hired an in-house publicist and two new marketing specialists to complement the four it had, and most top firms made similar moves, even if they privately believed that a16zs services were simply a marketing tool. Todd McKinnon, the C.E.O. of Okta, said, Every firm we talk to now is Hey, were doing all this recruiting, and well introduce you to big customers. Its become the table stakes.Benchmark, by contrast, took down its Web site. Its like watching Coke and Pepsi go head to head, one C.E.O. told me. Bill Gurley declined my requests for comment, but he has publicly bemoaned all the money that firms such as a16z are pumping into the system at a time when he and many other V.C.s worry that the tech sector is experiencing another bubble. So many investors from outside the Valley want in on the startup world that valuations have been soaring: last year, thirty-eight U.S. startups received billion-dollar valuations, twenty-three more than in 2013. Many V.C.s have told their companies to raise as much money as possible now, to have a buffer against a crash.Benchmarks funds top out at four hundred million dollars and are reserved for early-round investing: the original, artisanal venture model. A16z raised $1.5 billion each for its third and fourth funds, in 2012 and 2014, with much of the money earmarked for later, costlier growth rounds, whose returns tend to be capped at 5x. Andreessen argues that startups now wait longer and raise more capital before going public, and a16z wants to be in those conversations, too. He also says that larger funds will allow the firm to provide even more of the services that its entrepreneurs crave. But, in the Valley, increasing your fund size so dramatically is customarily seen as smoking your own exhaust, or, among those with a classical turn of mind, hubris. Venture doesnt scale, Diane Mulcahy, the L.P. and venture critic, said. Raising and investing more doesnt increase the number of billion-dollar companies, and offering services to entrepreneurs wont help the firm generate returns. Its like a Saks Fifth Avenue that gives everybody a free iPhone. Are they going to attract everybody and see everybody? Yes. Are they going to make money? Not for long.When I pressed Andreessen on a16zs fund size, he said that even if the basic assumptions havent changedeven if only fifteen companies a year reach a hundred million dollars in revenuethose companies generate more money now. And, he said, Id bet the number of companies that reach that revenue is going up. With a playful smile, he referred to Gurley: If theres no profit opportunity beyond the first four hundred million, Bills making the case that everyone who follows Benchmark in a later investment round is a moron. I wouldnt say that.One morning, as I sat down to breakfast with Andreessen, a rival V.C. sent me a long e-mail about a16zs holdings. The V.C. estimated that because Andreessens firm had taken so many growth positions, its average ownership stake was roughly 7.5 per cent (its eight per cent), which meant that to get 5x to 10x across its four funds you would need your aggregate portfolio to be worth $240-$480B! You would, in other words, need to invest in every Facebook and Uber that came along. When I started to check the math with Andreessen, he made a jerking-off motion and said Blah-blah-blah. We have all the modelswere elephant hunting, going after big game!In addition to assuaging various slights from V.C.s, Andreessen is attempting to assuage the wound of the 2000 crash, by maintaining that it was an isolated event. The argument in favor of concern is cyclical, he told mebusts follow booms. The counterargument is that stuff works now. In 2000, you had fifty million people on the Internet, and the number of smartphones was zero. Today, you have three billion Internet users and two billion smartphones. Its Pong versus Nintendo. Its Carlota Perezs argument that technology is adopted on an S curve: the installation phase, the crashbecause the technology isnt ready yetand then the deployment phase, when technology gets adopted by everyone and the real money gets made. So the 2000 tech crash prefigured not the next crash but a sustained boom. And Andreessens portfolio, like the entire Sand Hill Road enterprise, wasnt so much overpriced as underappreciated.We even tried a visit from a celebrity.Still, he recently tweeted that startups were spending too much. When the market turns, he wrote, nobody will want to buy your cash-incinerating startup. There will be no Plan B. vaporize. And, come to think of it, maybe it wasnt prudent to raise too much, either. In one pitch meeting where a portfolio company sought a billion-dollar growth round, Andreessen raised his arms overhead and made an explosive sound to warn of what can happen when your valuation vastly exceeds your revenues: Thanks for playinggame over! The company went on to secure its round, with only a token contribution from a16z. Andreessen later said that, as in an increasing number of deals, growth investors had paid one round ahead of progresspaid in other words, for the results they hoped to see in the following round. Though the companys lofty valuation buoyed a16zs portfolio, his body language suggested that buying at such valuations was maybe not smartbut, as long as theyre sophisticated investors, its not our job to moralize on whether theyre overpaying.Another way of framing the growth-funding question, Peter Thiel suggests, is that Andreessen may not be as suited to making early, counterintuitive investments as he isa point that Andreessen concedes: Peter is just smarter than I am, and in a lateral way. But, Thiel says, Andreessen is well positioned, because of his broad knowledge and flexible mind-set, to respond to incremental changes in an array of fields. And that, he argues, is what the times reward: While Twitter is a lesser innovation than flying cars, its a much more valuable business. We live in a financial age, not a technological age.In December, Apoorva Mehta, the founder of a grocery-delivery app called Instacart, came to a16z to ask it to fill out his C round. The firm had led Mehtas B round with an investment of twenty-seven million dollars, but he reminded the team anyway that Instacart is quite a magical experience. Then he invoked a few sharing-economy shibboleths, including we dont have any infrastructure, mobile-powered independent contractors, and machine-learning-based fulfillment engine. In two years, Mehta had set up in fifteen cities, signed up many of the independent grocery chains, including Whole Foods, and showed profitability in a number of stores. And it was a defensible network, because he installed refrigerated lockers in the stores. At the same time, because Mehta had recently changed his model, Instacart was losing money on each delivery, and that amount was growing as he rapidly expanded into new markets.Andreessen applied a disinfecting wipe and said, Let me ask you a question I know the answer to. In 1999, there was no more flaming debacle of a business than grocery delivery online. You were probably twelve at the time of Webvan?Thirteen, Mehta said.So why now?The main reason is you have access to labor through smartphones. Its the same reason Uber and Lyft exist now.Andreessen nodded with satisfaction: You can orchestrate the entire supply chain through your phone. Webvan was what he called a ghost storya cautionary tale that still frightened investors. But Instacart proved that even haunted houses could be rehabilitated.Another partner asked about competitors, including Uber, TaskRabbit, Amazon Fresh, and Fresh Direct. The other, older models cant do instant delivery, Mehta replied. And the newer ones dont have anywhere near our coverage and range of data in groceries. So if you want slower delivery and smaller selection, go with them. Andreessen smiled, savoring the contempt.At the deal review, Jeff Jordan, who sits on Instacarts board, praised Mehtas progress, while noting concerns about unit economicshow hed get to profitability on each delivery. Referring to the venture communitys enthusiasm for the round, Jordan went on, This is an I missed Uber, I dont want to miss the next one climate. Balancing everything, he recommended that the firm put in ten million dollars.Horowitz argued for a bigger investment. Mehtas moat against competitors is really fucking deephe already has Whole Foods, monster of monsters. Its the biggest market of all time, incredibly huge.After other partners argued that the valuation seemed high, Andreessen looked at Horowitz: Ben, I think youre making an even more provocative point than people understand. It sounds like youre saying this could be an Uber for real.I think so, Horowitz said. What makes unit economics really scary is if youre in a competitive market. Hes in a monopoly.Andreessen said, We could go to the well, and go in higher. He beckoned, coaxingly. Horowitz thought it over, then said, I dont want to override Jeff. Andreessen, too, seemed content to temper his enthusiasm and to share the round with other firms. (Mehta eventually raised two hundred and twenty million dollars on a valuation of two billion.) Hed like to make twenty times the investments the firm does, but every opportunity comes with an opportunity cost, and even $1.5 billion doesnt last forever.Andrew Golden, the chief investment officer for Princeton University, an L.P. in a16zs last three funds, told me that, when the firm started, my worry was that Marc is such a big personality he wouldnt necessarily listen to someone who told him he was wearing fewer clothes than he thought. But now my working hypothesis is that Marc is smart enough to know that hell do better if he doesnt try to win every argumentif he doesnt try to go undefeated.In March, Andreessen and his wife announced the birth of their son, whod been carried to term by a gestational surrogate. They named him John, for Lauras father. I feel fantastic! Andreessen told me. Hell come of age in a world where ten or a hundred times more people will be able to contribute in science and medicine and the arts, a more peaceful and prosperous world. He added, tongue in cheek, Im going to teach him how to take over that world!Andreessen often remarks that, in the blue-collar milieu he came from, no parent wants his or her child to stay blue-collar. His own circumstances have changed dramaticallyhe is now a paper billionaire, though he argues that his net worth depends on how you value a16zso I told him it seemed paradoxical that some of his other babies, such as Instacart and Lyft, make their profits off blue-collar drivers and pickers who must freelance without a safety net to make ends meet. Unsurprisingly, he strongly disagreed: Maybe theres an alternate way of living, a free-form life where you press the button and get work when you want to.One afternoon, as we sat at his baronial dining table, he made an agonized but sincere effort to discuss his blue-collar childhood without mentioning his nuclear family. I really identified with Charles Schulz in the David Michaelis biography of him, Schulz and Peanuts, he said. I was struck by the parallels between Andreessen and both Peanutsin which Charlie Brown has a massive bald head and the parents are kept offstageand its creator. Charles Schulz, who grew up in Minnesota, was socially awkward, hated being embraced, and loathed his mothers Norwegian relatives, a farming family. Andreessen went on, Ninety-six per cent of the people who grow up like he and I did, in the Midwest, just stay there, but the ones who leavethe cartoonist, too, moved to Californiabecome intensely interested in the future. In Schulzs last ten years, he really focussed on Rerun, Linuss younger brotherthe youngest and most optimistic character.I told Andreessen that this seemed like a tendentious reading of Rerun, a bland character whose two most famous lines are Ill drink to that and My brother is the only one in the family with a blanket, and I dont want to end up like him. Taken aback, he explained, Hes the youngest, hes the newest, he has the most life in front of him. Andreessen, as he saw himself, was both an immigrant to the land of opportunity, like the entrepreneurs he preferred to fund, and someone whose childhood was merely an installation phase. He told me, It wasnt that I felt misunderstood or badly treated; it was that I was so completely different. I wasnt seeking understanding. I wasnt indexing myself against the people around me.Andreessen reminded mein his formidable achievements and manner, his thickly armored sensitivities and yearningsof Rilkes remark Perhaps everything that frightens us is, in its deepest essence, something helpless that wants our love. When I told him so, he stared back in absolute horror.Last year, a programmer named Alex Payne wrote an open letter to Andreessen in which he observed, People are scared of so much wealth and control being in so few hands. Consequently, wherever you and other gatekeepers of capital direct your attentiontowards robots, 3D printers, biotech, whateveryoure going to detect a fearful response as people scramble to determine the impact of your decisions and whims, which only compound lingering structural unemployment and an accumulation of capital at the top of the economic pyramid.Good Evening, ladies and gentlemen! If I may have just a moment of your timemy name is Edward and Ill be sitting here reading the paper with my mouth shut. Thank you for you time, have a good evening and God bless!Payne addressed his thoughts to Andreessen because Andreessen represents the Valleyboth in its soaring vision and in its tendency to treat people as a fungible mass. But Andreessen waved away the criticisms as the ravings of a self-hating software engineer. When I persisted, he said, Ordinary people love the iPhone, Facebook, Google Search, Airbnb, and Lyft. Its only the intellectuals who worry. He raised counter-arguments, then dismissed them: technology would solve any environmental crisis hastened by an expanding economy, and as for the notion that, as he said, You American imperialist asshole, not everyone wants all that technologywell, bullshit! Go to a Chinese village and ask them. Technology gives us superpowers, makes us smarter, more powerful, happier. Would the world be a better place if there were fifty Silicon Valleys? he said. Obviously, yes. Over the past thirty years, the level of income throughout the developing world is rising, the number of people in poverty is shrinking, health outcomes are improving, birth rates are falling. And itll be even better in ten years. Pessimism always sounds more sophisticated than optimismits the Eden-collapse myth over and over againand then you look at G.D.P. per capita worldwide, and its up and to the right. If this is collapse, lets have more of it!Global unemployment is rising, toothis seems to be the first industrial revolution that wipes out more jobs than it creates. One 2013 paper argues that forty-seven per cent of all American jobs are destined to be automated. Andreessen argues that his firms entire portfolio is creating jobs, and that such companies as Udacity (which offers low-cost, online nanodegrees in programming) and Honor (which aims to provide better and better-paid in-home care for the elderly) bring us closer to a future in which everyone will either be doing more interesting work or be kicking back and painting sunsets. But when I brought up the raft of data suggesting that intra-country inequality is in fact increasing, even as it decreases when averaged across the globeAmericas wealth gap is the widest its been since the government began measuring itAndreessen rerouted the conversation, saying that such gaps were a skills problem, and that as robots ate the old, boring jobs humanity should simply retool. My response to Larry Summers, when he says that people are like horses, they have only their manual labor to offerhe threw up his hands. That is such a dark and dim and dystopian view of humanity I can hardly stand it!One challenge for Andreessen is whether venture itself has a skills problem. If software is truly eating the world, wouldnt venture capital be on the menu? The AngelList platform now allows investors to fund startups online. Its co-founder Naval Ravikant said that future companies will require more two-hundred-thousand-dollar checks and way fewer guys on Sand Hill Road. Jeff Fagnan, of Atlas Venture, which is the largest investor in AngelList, said, Software is already squeezing out other intermediariestravel agents, financial advisersand, at the end of the day, V.C.s are intermediaries. Were all just selling cash.Andreessen sometimes wonders if Ravikant is onto something. Hes asked Horowitz, What if were the most evolved dinosaur, and Naval is a bird? Already, more than half the tech companies that reached a billion-dollar valuation in the past decade were based outside Silicon Valley. And as Andreessen himself wrote in 2007, before he became a V.C., Odds are, nothing your V.C. does, no matter how helpful or well-intentioned, is going to tip the balance between success and failure.He still believes thatbut he also thinks that a16z can cut a companys time to success in half, and time is money. He also believes that venture will maintain its incumbency because computers cant yet introduce you to just the right engineer or chief information officer at eBay, and machines cant yet come to your office at midnight to future-proof your letter to perturbed customers. Indeed, venture is one of the most human businesses going. Only human beings could have created such a supercollider of contradictions: a font of innovation that pools around conformity; a freedom train that speeds toward monopoly; a promoter of transparency that shrouds its own dealings; a guild thats dedicated to flattening hierarchies, and that rewards its leaders with imperial power.Naturally, Andreessen had to weigh the counterargument, and consider whether he added any value at all. One Sunday afternoon, as he sat alone at the head of a16zs conference table, he said, Chris Dixon argues that were in the magical-products businessthat we fool ourselves into thinking were building companies, but it doesnt matter if we dont have the magical products. And magic could not be summoned, only prepared for. Over twenty years, he continued, our returns are going to come down to two or three or four investments, and the rest of thishis gesture took in the building full of art, the devotions of more than a hundred eager souls, even the faux-Moorish rooftops of his competitors down the roadis the cost of getting the chance at those investments. Theres a sense in which all of this is mathyou just dont know which Tuesday Mark Zuckerberg is going to walk in.Yet math was no help with mass psychology. Even if we could do perfect analysis, we just cant know the future, he said. What if Google Ventures had access to all Google searchescould you predict hit products? Or perfect access to all of peoples conversations or purchases? You still wouldnt know whats going to happen. How is psychohistory going? he went on, referring to Isaac Asimovs invention, in his Foundation novels, of a statistical field that could predict the behavior of civilizations. Not very fucking good at all! Which, by the way, is part of what makes this job really fun. Its a people business. If we could revise the industry completely, wed just dump all the business plans and focus on peoplethe twenty-three-year-old Mark Zuckerberg, Bill Gates, Steve Jobs.He acknowledged, though, that his optimism dims once human beingswith their illogic, hidden agendas, and sheer bugginessenter the equation. Were imperfect people pursuing perfect ideas, and theres tremendous frustration in the gap, he said. Writing code, one or two people, thats the Platonic ideal. But when you want to impact the world you need one hundred people, then one thousand, then ten thousandand people have all these people issues. He examined the problem in silence. A world of just computers wouldnt work, he concluded wistfully. But a world of just people could certainly be improved.*An earlier version of this article misstated the name of Sequoia Capital.Tad Friend has been a staff writer at The New Yorker since 1998. He is the author of Cheerful Money: Me, My Family, and the Last Days of Wasp Splendor.Read more More:Silicon ValleyTechnologyVenture CapitalistsNever miss a big New Yorker story again. 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