ALAN MOTA ANDRÉ CYTRYN

CAROLE LEQUIN DIANE DEVEDEUX

RICARDO BEREZINBUSINESS MODELING - COPPEAD/UFRJ

a16z

EXECUTIVE SUMMARY

▸ Story of a16z and how did they start;

▸ What is the business model and how it differentiates with current models;

▸ Case analysis;

▸ How they fit entrepreneurs in their values as VC’s;

▸ Current and future market analysis;

▸ Suggestions.

A LITTLE STORY

THE COMPANY

▸ American Venture capital firm created in 2009 by Mr. Marc L. Andreessen and Mr. Benjamin A. Horowitz;

▸ Entrepreneurial background;

▸ Specialised in seed investment, start-ups in the social media and technology business.

“A TECHNOLOGY STARTUP IS ALL ABOUT THE ENTREPRENEURIAL TEAM AND THEIR VISION. OUR JOB AS VENTURE CAPITALISTS IS PRIMARILY TO SUPPORT ENTREPRENEURS BY HELPING THEM BUILD GREAT COMPANIES AROUND THEIR IDEAS”

Ben Horowitz

A LITTLE STORY

THE IDEA

▸ It’s not (just) about money;

▸ A team, a network, instead of an artisan, a “jack-of-all trades”;

▸ GPs: smaller salary, big capital gains;

▸ Scalable efforts (not to serve as a crutch);

“WE’D HEARD LOTS OF ENTREPRENEURS TELL HORROR STORIES ABOUT THEIR VCS. SO WE SET OUT TO CREATE A FIRM WE WOULD HAVE WANTED TO WORK WITH”

Marc Andreessen

▸ Trust and respect;

▸ “Founders make the best CEOs”;

▸ “Software is eating the world”.

SOURCE, PICK AND WIN

BUSINESS MODEL

▸ 3% of VCs generate 95% of the returns;

▸ Increasing number of private funding;

▸ Strength rather than lack of weakness.

LOOK INSIDE AND OUTSIDE

SWOT ANALYSIS

STRENGHTS: ‣ SKILLED AND SPECIALISED WORKFORCE ‣ BARRIERS ON ENTRY MARKET ‣ HIGH GROWTH RATE, PROFITABILITY AND REVENUE ‣ ATTRACT INVESTORS AND INSPIRE TRUST ‣ EXPERIENCE DUE TO BACKGROUND OF FOUNDERS AND GPS

WEAKNESSES: ‣ TAXES AND COSTS ARE HIGH ‣ COMPETITIVE MARKET ‣ CONCENTRATED MARKET ‣ RARE OPPORTUNITIES ‣ LONG TERM INVESTMENTS

OPPORTUNITIES: ‣ GROWING MARKET = GROWING DEMAND ‣ NEW MARKETS (SECTOR AND GEOGRAPHIC) ‣ ACQUISITIONS

THREATS: ‣ RISKY BUSINESS ‣ STRONG COMPETITION ‣ “COPYCATS” ‣ INCREASING COSTS

WHAT DO THEY FOCUS ON?

ENTREPRENEUR

▸ Looking for brilliant and courageous entrepreneur with or without degree;

▸ because college dropouts combine courage, brilliance and an idea good enough to make a smart person walk away from guaranteed success.

SOFTWARE IS EATING THE WORLD

INVESTMENTS

Are they all about Internet? Unorthodox investments include:

‣ Soylent (meal replacement beverage)

‣ Airware (commercial drone information platform)

‣ Oculus (VR hardware)

‣ Jawbone (mobile accessories)

‣ Julep (beauty products)

‣ Transferwise (money transfer)

‣ Opengov (business intelligence for the public sector)

HOW TO DIFFERENTIATE?

MARKET

CLOUDCOMPUTING

EXISTING

DATA ANALYTICS ROBOTICS

SOCIAL NETWORKS

ONLINE RETAILING

GAMINGVR

COSMETICS

NUTRITION SOFTWARE & HARDWARE

VIRTUAL CURRENCY

SYNTHETIC FOODS

NONEXISTING…YET

WHO KNOWS?QUANTUM COMPUTING

BIOHACKINGMEDICINE

SPACE EXPLORATION

WHAT NOW?

SUGGESTIONS

▸ Team up with existing VC firms in key markets, as if AH was a “sponsor" of these firms. In other words: AH gets access to their work and gives them extra money for projects they like the most. Key markets: China, UK, Israel, Brazil, Germany, Russia.

▸ Open a sort of task force within key issues that might be overlooked by the firm, because of its focus on internet/software. Key issues: healthcare and privacy/data security.

QUESTIONS?