In a rare glimpse of venture capital performance, Andreessen Horowitz has released some documents that give the public insight into how its investments have been performing.
There is much to be admired — Andreessen’s first three venture funds have nearly doubled their investment capital since founding.
Good — but not great — according to a Wall Street Journal analysis of the data. Apparently, by the numbers, they have not quite achieved elite status just yet.
Sequoia (a firm whose founding is roughly contemporaneous with Andreessen’s, for example) has seen its 2003 and 2006 funds rise eightfold net of fees — from a successful run of investments in LinkedIn, YouTube, Airbnb and Dropbox. Its 2010 fund is up 5.5 times — mostly based on the very successful exit of WhatsApp.
Benchmark, to take another example, has multiplied investors’ money 11 times net of fees in its 2011 fund.
Andreessen, since founded, had returns of $1.2 billion in cash to investors, net of fees, meaning that Sequoia did better on its WhatsApp investment alone.
For its part, Andreessen has waved off concerns about its “elite” status.
“Only real, actual cash and stock distributions matter,” wrote Andreessen Horowitz Managing Partner Scott Kupor. “Venture capital is a long game.”
Though it falls short of its top-notch rivals, all three Andreessen Horowitz funds — whose bets include Instagram, Airbnb and Pinterest Inc. — have outperformed the average of venture funds raised in the same years. There are also investments — like the one with Airbnb — set to pan out very lucratively in the event of an IPO.