Chris Dixon is a general partner at Andreessen Horowitz. He is discussing reports in the press regarding venture capital firms backing multi-billion-dollar late-stage startups.
Disclosure
Dixon: a16z funds operating teams with management fees rather than partner salaries
“The traditional structure is basically that VC funds charge fees and then most of those fees go to the partner salaries. We don't, instead we put our fees towards these operating teams. So for our competitors to copy us, they'd have to kind of dramatically cha…”
Assertion Supported
Dixon: Top-performing VC firms have higher loss rates than lesser firms
“There's a lot of data in the VC industry that actually, interestingly enough, the best firms actually have a higher loss rate, meaning they lose money more frequently than the less.”
Prediction Not checkable as stated
Dixon: Virtual reality will be the next computing wave after mobile
“I think it will be, like, when we look back on the history of computing, it will be, the key milestones will be, I mean, I'm, this is, I'm at the extreme end of excitement here, but there'll be, you know, the PC, the Macintosh, or something like this, then the…”
Prediction Didn’t hold up
Dixon: By 2025 remote conversations will probably occur in VR
“I think, you know, in 10 years, we'd be probably having this conversation in virtual reality, and we'd be, you know, looking at each other across the room, and it would feel like we're in the same room.”
Insight
Dixon: Basic highway autonomous driving is easy; edge cases are the challenge
“So like self-driving cars are another good example where if somebody tells you, oh, I saw a self-driving car, and it was able to drive on the highway during daylight, that's actually not very impressive, and that's actually something that almost anyone can bui…”
Assertion Contradicted
Dixon: a16z employs over 100 non-investor operational staff
“We have over a hundred employees who are not investors at our firm, whose sole job it is to help companies do things like recruit employees you know build their, you know, their customers base.”