My First Million Wiki

Marc Andreessen

15 min read

Marc Andreessen

The most influential venture capitalist of the last two decades built his reputation on a single essay. In 2011, Marc Andreessen published “Why Software Is Eating the World” in the Wall Street Journal. The thesis was not complicated. Software companies were invading and overturning established industries. Thirteen years later, the essay has aged so well that Sam and Shaan use “software eating the world” as conversational shorthand, the way people say “supply and demand” — not as insight, but as furniture. Something everyone has internalized so deeply that its origin no longer requires attribution.

What makes Andreessen unusual is not that he was right. Lots of people are right about technology trends. What makes him unusual is that he structured an entire institution around being right — and that institution changed the rules of venture capital itself.

The Barefoot Kid on the Cover of Time

Before he was a venture capitalist, Andreessen was a data point in one of the most studied patterns in technology: the hobbyist who achieves sudden, world-altering status.

As Shaan describes it when explaining James Currier’s technology window theory: the cycle starts when a hobbyist achieves wealth and status using a new technology. “This is like Marc Andreessen on the cover of Time barefoot because the hobbyist internet guy became rich by building the browser.” Ocean is the New Space

Andreessen co-created Mosaic, the first widely used web browser, while he was still a student at the University of Illinois. He then co-founded Netscape, which went public in 1995 in what became one of the defining IPOs of the internet era. He was 24 years old. The image of him barefoot on the cover of Time became a kind of visual shorthand for the entire dot-com moment — the signal that the technology window was open, that the hobbyists had arrived, and that everything downstream was about to change.

What happened next is the part people forget. Netscape lost the browser war to Microsoft. The company was sold to AOL. The product that made Andreessen famous was, by conventional standards, a failure. He was right about the internet but wrong about his own company’s ability to dominate it.

The lesson Andreessen seemed to extract from this was not about building better products. It was about picking better markets. As Sam Parr relays Andreessen’s philosophy: “People are like, ‘Marc, what’s most important? Is it having a good team? Is it having a good product? Or is it picking the right market?’ And he goes, ‘It’s picking the right market. That’s easily the most important thing because if you pick the right market, you could have a bad team and a bad product and the market pulls the success out of you.’” 5 Under the Radar Trends

This is a counterintuitive claim from a man who literally built one of the defining products of the internet. He is telling you that his product mattered less than the wave it rode.

Reinventing Venture Capital

In 2009, Andreessen and Ben Horowitz founded Andreessen Horowitz, known as a16z. On its surface, this was just another venture fund. Underneath, it was a thesis about what venture capital was about to become.

Matt Mazzeo, an investor who worked closely with the Silicon Valley ecosystem, explains the insight Marc had early. When Mazzeo entered the industry, “there were like 10 seed funds in market. You didn’t have to be good, you just had to be alive to go and find these things. There wasn’t a ton of competition. There weren’t mega funds coming in and doing seed rounds. You met a founder, you liked the founder, you went to YC, there were 50 other people in the room.” How to Scale a Profitable Agency with AI

Marc saw where this was headed. As Mazzeo puts it: “He’s like, ‘All of these asset classes are maturing and we’re going to build a much bigger platform for it.’”

The a16z model drew from an unexpected source: Hollywood talent agencies. Mazzeo describes how the Creative Artists Agency under Michael Ovitz had shifted from a boutique model — one agent representing one client — to a platform model where one client sat at the center of ten specialists. Andreessen applied the same logic to startups. Instead of one partner sitting on your board, a16z offered recruiting, marketing, business development, communications, and a growing portfolio of services.

“Andreessen comes along and it’s like, ‘No, you’ve got all of us and we all come with this value proposition — recruiting and marketing and all of these services,’” Mazzeo explains. “It was the realization that VC was a service industry and institutionalizing of that changed the way that a lot of venture had been done.”

The response from the industry was immediate and telling. “Everybody rushed to create platforms and teams and structure because they were just beating people on that, even if it wasn’t effective. They pushed the edge of that and they owned the brand of what a platform VC could be.”

At the other extreme stood firms like Benchmark and Founders Fund, which took the opposite position: you do not need a platform, you need a single brilliant partner, or perhaps no help at all. The market bifurcated. There was no middle. And a16z owned one of the two poles.

The Philosopher and the Executor

When Amjad Masad, the founder of Replit, was raising money from a16z, Marc invited him to breakfast at 10:00 AM at his house. Masad expected to discuss the business. Instead, they spent two or three hours talking about politics, philosophy, and the state of the world. I Got Rejected from YC 4x

Masad’s observation is revealing: “I felt like this guy is more than just a technologist, he’s like a philosopher. And so right now he’s going out and he’s talking about this stuff, like his Joe Rogan interview went super viral. He’s always had these interesting ideas about the world.”

The dynamic between the two founders of a16z is something Masad noticed immediately. “His partner Ben is sort of the executor, the executive. He wrote The Hard Thing About Hard Things, where he teaches you about what it means to run a company. It’s painful, it’s hard, and what it means to hire executives, what it means to scale. And so you have this duo of the doer and the philosopher. And I think they have really big plans and they’re almost just getting started.”

Ben Horowitz, in his own appearance on MFM, demonstrates exactly this complementary energy. Where Marc deals in abstractions and grand narratives, Ben talks about fining employees $10 per minute for being late to meetings with founders, about firing people who talk smack about entrepreneurs on social media, about the difference between cultural values plastered on a wall and cultural virtues practiced as daily habits. “A culture is a set of actions,” Ben says. Not ideas. Actions. Weird Ways Ben Horowitz Makes Founders More Confident

The firm they built reflects both personalities. It manages over $46 billion in assets and has invested in Stripe, Coinbase, OpenAI, and dozens of other companies that define the current technology landscape. But it also does something that no prior venture firm did at scale: it produces content.

Content as Competitive Moat

This is perhaps Andreessen’s most consequential innovation for the MFM audience, because it directly influenced the model Sam and Shaan built.

A16z was one of the first venture firms to operate as a media company. The firm runs podcasts, publishes an influential technology blog, produces research reports, and has built distribution channels that rival standalone media properties. In 2024, a16z acquired Turpentine, a podcast network, further consolidating its media capabilities.

Mazzeo describes the strategic logic: “The scarce resource is attention. And so it’s like, ‘We’re going to build attention into the offering.’ And most VCs were selling things that weren’t necessarily what the customer needed. It was capital.”

The insight was that capital had become a commodity. Every fund could write a check. But not every fund could make a founder famous, drive customer acquisition through media distribution, or position a portfolio company in the broader technology conversation. As Shaan puts it, what startup founders actually wanted was “the brand a16z. I want cool, I want Andre Iguodala to be at our event, I want to meet him.”

This model — content as distribution, distribution as competitive advantage — is the same playbook that Alex Hormozi uses at Acquisition.com, that MrBeast uses in consumer products, and that Sam and Shaan use on MFM itself. The difference is that Andreessen was running this playbook in the venture industry a decade before it became conventional wisdom.

The Conviction Bets

A16z’s most discussed characteristic on MFM is its willingness to make large, conviction-driven bets in categories that other investors consider too risky or too weird.

The crypto bet is the clearest example. A16z committed billions to crypto and Web3 investments during a period when much of the technology industry was skeptical or outright hostile to the space. The story that captures this posture most vividly: when someone created an AI Twitter bot with a crypto wallet, “Marc Andreessen gave it 50,000 of crypto.” This was not a serious investment. It was a gesture — a willingness to play at the edges that signals genuine conviction about the underlying technology. $100B Founder Breaks Down the Future

The same DNA runs through the firm’s AI investments. A16z was an early and aggressive investor in AI companies including OpenAI, and Andreessen has positioned himself as one of the most vocal advocates for AI acceleration in the technology industry.

This approach has more in common with Founders Fund’s philosophy than most people recognize. Shaan describes how Founders Fund backed Anduril when “it was completely unpopular to back a weapons company” and how the firm’s founding principle was almost Fight Club-like: “The only rule is that there are no rules. The rules that we set as a fund are going to limit our ability to find the singular business.” I Ranked the Best and Worst Businesses

A16z is more institutional than Founders Fund, more structured, more platform-oriented. But the underlying conviction is similar: the biggest returns come from bets that break the existing mental models of what a venture investment should look like.

The Mega-Fund Era He Predicted

Matt Mazzeo’s observation about Marc may be the most important one for understanding his legacy in venture capital: he saw the institutional future of the industry before anyone else.

When Mazzeo entered VC, the mechanics were hidden knowledge. “How to write a term sheet was unknown. How to do a closing process was unknown. The real mechanics of the industry were unknown.” Since then, tools like the YC SAFE have standardized fundraising. Podcasts and newsletters have published institutional knowledge. The industry has been, as Mazzeo describes it, “protocolled.”

Marc predicted this maturation. He understood that if venture was going to be institutionalized, you wanted to be the institution. While other firms stayed small and artisanal, a16z built scale. Today, a16z manages assets that would have been unthinkable for a venture firm 20 years ago.

The irony is that by institutionalizing venture, Andreessen also made it harder. As Sam and Shaan frequently observe, the scrappy era of venture — the era that produced their own angel investments and early bets — is largely over. The competition is structural now. The mega-funds do seed rounds. The knowledge is public. The process is documented.

Marc Andreessen did not just participate in this transformation. He accelerated it.

The Man Behind the Thesis

There is an amusing moment on MFM where Sam and Shaan are discussing the existential threat of AI to various professions. Sam jokes that “Marc Andreessen should be scared right now, not us.” Shaan takes the joke further: “The smart guys are digging their own graves. Their shovels are clanking together on accident.” Sam adds: “‘Is my name on the tombstone? That’s weird. Is there another Marc here?’” No Small Boy Stuff: Investing

The joke works because Andreessen occupies an unusual position. He is simultaneously the person most associated with technology’s ability to disrupt every industry and one of the people most exposed to that disruption. The man who declared that software was eating the world now watches as AI threatens to eat venture capital itself.

His response has been characteristically aggressive: lean into the disruption, bet on it, try to own the future rather than be consumed by it. It is the same pattern he has followed since Netscape — not always winning with the product, but always being on the right side of the wave.

His daughter is married to John Arrillaga Jr., the son of the legendary Silicon Valley real estate investor who became a billionaire by knowing every building within two miles of Stanford’s campus. As Mohnish Pabrai notes on MFM, this makes it “billionaire to the power of billionaire.” Asking a Billionaire Investor

But the detail worth lingering on is the contrast between the two approaches. Arrillaga made his fortune by being an inch wide and a mile deep — knowing one geography, one asset class, one strategy, and executing it for decades. Andreessen has done the opposite. He has made his fortune by being a mile wide — by declaring that software would eat everything, then building a firm large enough to invest in the eating.

Both approaches produced billionaires. But only one of them changed how an entire industry operates.

Key Themes on MFM

ThemeDescription
Software Eating the WorldThe foundational thesis that every industry will be disrupted by software companies
Platform VCA16z’s model of treating venture capital as a full-service platform rather than a boutique partnership
Content-to-CommerceUsing media and content as competitive moat in investing
Conviction InvestingMaking large, concentrated bets on contrarian categories like crypto and AI
Technology WindowsThe concept that major opportunities cluster around new technology inflections

FAQ

Who is Marc Andreessen? Marc Andreessen is the co-founder of Netscape (the first widely used web browser), the co-founder of Andreessen Horowitz (a16z, one of the largest venture capital firms in the world), and the author of the influential 2011 essay “Why Software Is Eating the World.” He is one of the most referenced figures in the MFM universe, both as a historical figure in technology and as a current force in venture capital.

What is Andreessen Horowitz (a16z)? A venture capital firm founded in 2009 by Marc Andreessen and Ben Horowitz. It manages over $46 billion in assets and has invested in companies including Stripe, Coinbase, OpenAI, and hundreds of others. The firm pioneered the “platform VC” model, offering portfolio companies services in recruiting, marketing, and business development in addition to capital.

What does “software is eating the world” mean? The thesis, published in 2011, argues that software companies are fundamentally disrupting every major industry — from retail to finance to healthcare. The phrase has become shorthand in the tech and business community for the inevitability of digital disruption.

Why is Marc Andreessen important to MFM listeners? He represents several themes central to the podcast: the power of picking the right market over the right product, the use of content and media as business moats, the value of conviction bets in contrarian categories, and the institutionalization of venture capital. His firm’s model also directly influenced the content-plus-investing approach that Sam and Shaan practice.

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