Andreessen Horowitz to invest $400 million in seed-stage companies

It won't change the firm's investing strategy, but a16z will help founders find their first hires.

Plant seedlings.

Andreessen Horowitz is betting big on seed investments.

Photo: Christian Joudrey/Unsplash

Andreessen Horowitz has always had seed investing as a core part of its strategy, going back to big wins like its $250,000 check into Instagram. But going forward, a16z partners will have a new and much bigger $400 million fund to do it from. On Friday, the firm is announcing a standalone seed fund that's meant to give LPs new investing avenues and marshal dedicated resources for seed-stage companies.

"We're very good at hiring VPs of products and VPs of sales, but our focus hasn't been as much on, 'Here are the first 10 hires,'" said a16z general partner Martin Casado.

When it comes to investing, Casado stressed that nothing is changing on the strategy. There's no new partners or seed specialists, and the size of the fund is what they'd been allocating for seed investing anyways.

What does change is that the firm plans to focus more on seed-specific resources that start from the earliest days of company formation, when founders wrestle with hiring their first product manager or figuring out a marketing plan.

It also is a new product for its LPs, who can tune their risk tolerance across a16z's seed fund, main fund, growth fund and specialty funds like crypto and bio.

Venture firms have tried dedicated seed funds before, but not all of them have worked out. Kleiner Perkins launched a $4 million seed fund in 2015, orders of magnitude smaller than a16z's $400 million effort, before winding it down two years later after the dedicated partners on it left the firm.

The challenge with having a seed fund can be signaling risk. If a16z invests in a company at the seed, but doesn't do the next round of funding, other investors might interpret that as a negative sign. Casado says it cuts both ways: More often than not, his seed investments are getting preempted by other firms who want to lead the follow-on rounds, he said.

As nontraditional investors take more of a share of the later-stage market, the earlier stages of investing have become more crucial to traditional VCs' strategies. Andreessen said that of the investments it has made since the start of 2020, about half have been in seed-stage companies.

Now it has to come up with ways to support them. With more than 240 people working at the firm, Andreessen Horowitz has always marketed its extra services, from recruiting to growth strategies, as part of its perks for entrepreneurs. Having dedicated operations for the earliest-stage companies as a result of the new fund will only sweeten the pot and attract more founders.

"Having been in that situation myself, I can appreciate how important the founding time is and having a dedicated team on the operating side of that. I think it's a beautiful thing," Casado said. Casado co-founded Nicira Networks, one of Andreessen's most successful early-stage deals.


You need a healthy ‘debate culture’

From their first day, employees at Appian are encouraged to disagree with anyone at the company — including the CEO. Here’s how it works.

Appian co-founder and CEO Matt Calkins wants his employees to disagree with him.

Photo: Appian

Matt Calkins often hears that he’s polite, even deferential. But as CEO of Appian, he tells employees to challenge each other — especially their bosses — early and often.

“I love arguments. I love ideas clashing,” Calkins said. “I regard it as a personal compliment when someone respectfully dissents.”

Keep Reading Show less
Allison Levitsky
Allison Levitsky is a reporter at Protocol covering workplace issues in tech. She previously covered big tech companies and the tech workforce for the Silicon Valley Business Journal. Allison grew up in the Bay Area and graduated from UC Berkeley.

Some of the most astounding tech-enabled advances of the next decade, from cutting-edge medical research to urban traffic control and factory floor optimization, will be enabled by a device often smaller than a thumbnail: the memory chip.

While vast amounts of data are created, stored and processed every moment — by some estimates, 2.5 quintillion bytes daily — the insights in that code are unlocked by the memory chips that hold it and transfer it. “Memory will propel the next 10 years into the most transformative years in human history,” said Sanjay Mehrotra, president and CEO of Micron Technology.

Keep Reading Show less
James Daly
James Daly has a deep knowledge of creating brand voice identity, including understanding various audiences and targeting messaging accordingly. He enjoys commissioning, editing, writing, and business development, particularly in launching new ventures and building passionate audiences. Daly has led teams large and small to multiple awards and quantifiable success through a strategy built on teamwork, passion, fact-checking, intelligence, analytics, and audience growth while meeting budget goals and production deadlines in fast-paced environments. Daly is the Editorial Director of 2030 Media and a contributor at Wired.

Gopuff says it will make it through the fast-delivery slump

Maria Renz on her new role, the state of fast delivery and Gopuff’s goals for the coming year.

Gopuff has raised $4 billion at a $15 billion valuation.

Photo: Gopuff

The fast-delivery boom sent startups soaring during the pandemic, only for them to come crashing down in recent months. But Maria Renz said Gopuff is prepared to get through the slump.

“Gopuff is really well-positioned to weather through those challenges that we expect in the next year or so,” Renz told Protocol. “We're first party, we control elements of our mix, like price, very directly. And again, we have nine years of experience.”

Keep Reading Show less
Sarah Roach

Sarah (Sarahroach_) writes for Source Code at Protocol. She's a recent graduate of The George Washington University, where she studied journalism and criminal justice. She served for two years as editor-in-chief of GW's independent newspaper, The GW Hatchet. Sarah is based in New York, and can be reached at


AT&T CTO: Challenges of the cloud transition are interpersonal

Jeremy Legg sat down with Protocol to discuss the race to 5G, the challenges of the cloud transition and nabbing tech talent.

AT&T CTO Jeremy Legg spoke with Protocol about the company's cloud transition and more.

Photo: AT&T

Jeremy Legg is two months into his role as CTO of AT&T, and he has been tasked with a big mandate: transforming the company into a software-driven business, with 5G and fiber as core growth areas.

This isn’t Legg’s first CTO gig, just his biggest one. He’s an entertainment biz guy who’s now at the center of the much bigger, albeit less glamorous, telecom business. Prior to joining AT&T in 2020, Legg was the CTO of WarnerMedia, where he was the technical architect behind HBO Max.

Keep Reading Show less
Michelle Ma

Michelle Ma (@himichellema) is a reporter at Protocol, where she writes about management, leadership and workplace issues in tech. Previously, she was a news editor of live journalism and special coverage for The Wall Street Journal. Prior to that, she worked as a staff writer at Wirecutter. She can be reached at


How Canva uses Canva

Design tips and tricks from the ultimate Canva pros: Canva employees themselves.

Employees use Canva to build the internal weekly “Canvazine,” product vision decks, team swag and more.

Illustration: Christopher T. Fong/Protocol

Ever wondered how the companies behind your favorite tech use their own products? We’ve told you how Spotify uses Spotify, How Slack uses Slack and how Meta uses its workplace tools. We talked to Canva employees about the creative ways they use the design tool.

The thing about Canva is that it's ridiculously easy to use. Anyone, regardless of skill level, can open up the app and produce a visually appealing presentation, infographic or video. The 10-year-old company has become synonymous with DIY design, serving as the preferred Instagram infographic app for the social justice “girlies.” Still, the app has plenty of overlooked features that Canvanauts (Canva’s word for its employees) use every day.

Keep Reading Show less
Lizzy Lawrence

Lizzy Lawrence ( @LizzyLaw_) is a reporter at Protocol, covering tools and productivity in the workplace. She's a recent graduate of the University of Michigan, where she studied sociology and international studies. She served as editor in chief of The Michigan Daily, her school's independent newspaper. She's based in D.C., and can be reached at

Latest Stories