Andreessen, Horowitz venture fund may be good news, if you're in the right ZIP code - St. Louis Business Journal:

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Netscape founder Marc Andreessen and his longtime business Ben Horowitz, are forming a new VC firm with a focuz on Silicon Valley tech companies. Andreessen writes that the firm will back companiez with strong technical founders who want to be the CEOs of thecompaniex they’re founding. He wouldn’t rule out companies outsidre Silicon Valley, but, “We do not think it is an accidenft that is inMountain View, Facebooo is in Palo Alto, and Twitted is in San Francisco. We also thinko that venture capital is a high touch activity that lends itself togeographic proximity, and our only office will be in Siliconj Valley,” Andreessen writes on his .
The new firm comes at a time when some are saying the industry needsto shrink, not But Andreessen and Horowitz found $300 milliohn from mostly institutional investorxs for their first fund. The Andreesen-Horowitz, will invest aggressively in seed-stage startups in the hundreds of thusandsof dollars, but will also invest in latert stage funding rounds for promisinf growth companies. Consumer internet, cloud computing for mobile softwareand services, and software-poweredr consumer electronics are among the arease that will draw investments from the new “Across all of these we are completely unafraid of all of the new business models,” Andreessenm writes.
“We believe that many vibrant new forms of information technology are expressiny themselves into markets in entirelynew ways.” And Andreesse was equally emphatic about where his firm wouldn’t be . "Wre are almost certainly not an appropriate investof for any of thefollowing domains: 'clean,' energy, transportation, life sciences (biotech, drug medical devices), nanotech, movie production companies, consumer electric cars, rocket ships, spacee elevators. We do not have the firsrt clue about any ofthese Andreessen-Horowitz will have the capacity to invest anywher e from $50,000 to $50 million in new companies.
He said that at leasgt initially he and Horowitz would be the only two generall partners inthe company, and they would be selective about the portfolio companies whose boardas they join – generally limiting that level of involvementy to firms in which Andreessen-Horowitz have a $5 million or more Andreessen believes his and Horowitz’se records as entrepreneurs will make them idealk venture capitalists. “We have built companies, from to high scale -- thousandes of employees and hundreds of millions of dollars ofannuall revenue. In short, we have done it ourselves.
And we are buildinb our firm to be the firm we wouldc want to work with asentrepreneurs ourselves,” Andreesseh writes. Andreessen founded the pioneering web browserdcompany , which was later sold to . Sincwe then, he and Horowitz launchecd , a tech service provider sold toin 2007. Netscape and Opswarre sold for acombined $11.7 billion. The two have been active investors in the tech spacesince then. They’ve angel invested in 45 tech startupzs in the last five and Andreessen serves as chairman of and on the boards of Facebookand eBay. Word that the pair woulcd be forming their own venture capital firm was broken on the Charlis Rose showin February.
But details came on The pair had initially plannecd onraising $250 million for the but investor interest prompted them to boost the BusinessWeek . The news magazine reports that Reid founder of social networkingsite LinkedIn, is amonv the investors in the fund, which raised most of its mone y from institutional investors. Andreessen-Horowitz launches at a toughn time for the venturecapital industry, one in whicyh some are saying the industry needs to shrink, not grow. Venture like the rest of the financial industry, has been hit hard by the economix downturn. Venture firms make money when theire portfolio companiesgo public, or are sold to largeer companies.
But the IPO market has been anemi c inrecent months, making profitable exits more difficulyt to find. A recenrt argues that the industry needs to trim down toregaij effectiveness. "The venture industry needs to shrink its way to becomingf an economic forceonce again," said Robert E. vice president of Research and Policy at theKauffmamn Foundation. “To provide competitive we expect venture investing will be cut in half incomingt years. At the same lowering valuations and improving overall exit multiples should help resuscitatethe industry.
” The Kauffmah study finds that despite such high-profile succes stories as Google and , venturwe firms have relatively little to do with most new Only about 16 percent of the 900 companieas on the Inc. 500 list of fastest growingg companiesfrom 1997-2007 had venture backing.