Billionaire venture capitalist Marc Andreessen is laying out his crypto investing playbook, and defending one sector of the industry against critics.
In a new interview on The Lunar Society podcast, the co-founder of Andreessen Horowitz says that he invests in the crypto space the same way as other venture capital investments.
“We’re looking for really sharp founders who have a vision and the determination to go after it… where there’s some reason to believe that there’s some deep level of technological economic change happening, which is what you need for a new startup to wedge into a market.
That there’s a reason for it to exist, there’s a market for what they’re building and they’re going to build a product and there’s going to be an intersection between product and market and there’s going to be a way to make money.
We go into every crypto investment with the same timeframe we go into venture investing. So we go in with at least a five to 10-year timeframe, if not a 15 to 20-year time frame.”
Andreessen, who helps oversee $28.8 billion in assets as of April of 2022, says his firm avoids speculative projects.
“We anchor hard on the venture capital model. We treat these investments the exact same way as if we’re investing in venture capital equity. We basically buy and hold for as long as we can and have a real focus on the underlying intrinsic value of the product or technology that’s being developed.
If by speculation, you mean daily trading, trying to look at prices and charts, that we don’t do.”
Andreessen also weighs in on non-fungible tokens (NFTs), defending the digital asset sector against the common claim that they don’t have value.
“Let’s specifically take the form of NFT that everybody likes to criticize, which is NFT as a creative project, an image or a character in a fictional universe or something like that, the part that people like to beat on.
They’re just art, that’s just digital art. And so every criticism people make about that is the same criticism you would make of buying and selling paintings, of buying and selling photographs, of buying and selling sculpture.”
Andreessen uses the analogy of the Mona Lisa, saying that it may cost $25 to recreate with canvas and paint, but wouldn’t have the same value as the original due to the cultural importance and historical value that it and some NFTs carry.
“What explains the spread between $25 and the $10 billion or whatever that it would go at if it would ever hit the market? It’s because people care. Because it’s art. Because it’s aesthetic. Because it’s cultural.
Because it’s part of what we’ve decided is the cultural heritage of humanity, the thing that makes life worth living is that it’s not just about subsistence, that we’re going to have higher values and we’re going to value aesthetics.”
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