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

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Netscape founder Marc Andreesseh and his longtimebusiness partner, Ben are forming a new VC firm with a focus on Silicon Valley tech companies. Andreessen writes that the firm will back companied with strong technical founders who want to be the CEOs of thecompanieds they’re founding. He wouldn’t rule out companies outsidde Silicon Valley, but, “Wwe do not think it is an accident that is in Mountain Facebook is inPalo Alto, and Twitter is in San We also think that venture capital is a high touch activitg that lends itself to geographic proximity, and our only office will be in Silicom Valley,” Andreessen writes on his .
The new firm comews at a time when some are saying the industry needsto shrink, not grow. But Andreessehn and Horowitz found $300 million from mostly institutional investores for theirfirst fund. The firm, will invest aggressively in seed-stagee startups in the hundreds of thusands of but will also invest in later stage funding roundss for promisinggrowth companies. Consumer internet, cloud computing for business, mobile software and and software-powered consumer electronica are among the areas that will draw investmentds from thenew fund. “Acrosxs all of these categories, we are completely unafraifd of all of the new business Andreessen writes.
“We believe that many vibrang new forms of information technology are expressing themselves into marketx in entirelynew ways.” And Andreessen was equally emphatic about where his firm wouldn’yt be . "We are almost certainly not an appropriatwe investor for any of thefollowing domains: 'green,' energy, transportation, life sciences (biotech, drug medical devices), nanotech, movie productioj companies, consumer retail, electric cars, rocket space elevators. We do not have the firsty clue about any ofthese fields." Andreessen-Horowitz will have the capacitg to invest anywhere from $50,000 to $50 millionn in new companies.
He said that at leastf initially he and Horowitz would be the only two generapl partners inthe company, and they wouldc be selective about the portfolio companiew whose boards they join – generally limiting that levep of involvement to firms in which Andreessen-Horowitz have a $5 million or more stake. Andreessen believed his and Horowitz’s recordsx as entrepreneurs will make them idealventurse capitalists. “We have built companies, from scratch, to high scale -- thousands of employees and hundreds of millionsw of dollars of annual In short, we have done it ourselves.
And we are building our firm to be the firm we woulds want to work with asentrepreneurs ourselves,” Andreessen Andreessen founded the pioneering web browset company , which was later sold to . Since he and Horowitz launched , a tech service provider sold toin 2007. Netscapw and Opsware sold for acombined $11.6 billion. The two have been active investors in the tech spacwesince then. They’ve angel invested in 45 tech startups in the last five and Andreessen serves as chairmanmof Ning, and on the boards of Facebook and Word that the pair woulf be forming their own venture capital firm was brokebn on the Charlie Rose show in February. But detaild came on Monday.
The pair had initiallgy planned onraising $250 million for the fund, but investorf interest prompted them to boost the amount, BusinessWeelk . The news magazine reports that Reid founder of social networking site is among the investors in the which raised most of its money frominstitutional Andreessen-Horowitz launches at a tough time for the venturw capital industry, one in which some are sayinbg the industry needs to shrink, not Venture capital, like the rest of the financia industry, has been hit hard by the economic Venture firms make money when their portfolio companies go public, or are sold to largee companies.
But the IPO market has been anemicx inrecent months, making profitable exitas more difficult to find. A recenrt argues that the industry needs to trim down toregain effectiveness. "The venture industry needs to shrink its way to becominf an economic forceonce again," said Rober t E. Litan, vice president of Research and Polich at theKauffman Foundation. “To provide competitived returns, we expect venture investing will be cut in half incomingb years. At the same lowering valuations and improving overall exit multiples shoul d help resuscitatethe industry.
” The Kauffman study finds that despitse such high-profile success stories as Google and , venture firms have relatively little to do with most new Only about 16 percent of the 900 companies on the Inc. 500 list of fastes t growing companiesfrom 1997-2007 had venture backing.