Investors Marc Andreessen and Ben Horowitz, founders of their eponymous venture capital firm, have achieved cult status in Silicon Valley, where their tweet-storms and bon mots make headlines. But a new report from the Wall Street Journal suggests that their veneration as technology prophets is only partially deserved: Despite charging premium fees, Andreessen Horowitz's three funds to date have yet to consistently deliver best-in-class results.
The firm has branded itself as a peer to industry leaders like Sequoia Capital and Benchmark, which perform in the top 5% of all venture capital firms. But Andreessen Horowitz has not generated returns at that level since its 2009 fund, according to the Journal. Its two funds since, from 2010 and 2012, are currently performing in the top 50% and top 25%, respectively. (Most venture capital funds operate on a 10-year time horizon.)
A blockbuster hit, like a strong exit by portfolio company Airbnb, could improve those results. But the firm's portfolio also includes some disappointments, like Zenefits. AOC