Andreessen, Horowitz venture fund may be good news, if you're in the right ZIP code - bizjournals:

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Netscape founder Marc Andreessen and his longtimebusinesa partner, Ben Horowitz, are forming a new VC firm with a focua on Silicon Valley tech companies. Andreessen writes that the firm will back companiess with strong technical founders who want to be the CEOs of thecompaniexs they’re founding. He wouldn’t rule out companiesx outside Silicon Valley, but, “Wed do not think it is an accident that is inMountaij View, Facebook is in Palo Alto, and Twitter is in San We also think that venture capital is a high toucy activity that lends itself to geographic proximity, and our only offic e will be in Silicon Valley,” Andreesseh writes on his .
The new firm comes at a time when some are sayinv the industry needs to not grow. But Andreessen and Horowitz found $300 millionm from mostly institutional investors for their first fund. The firm, will invest aggressively in seed-stage startups in the hundred of thusandsof dollars, but will also invest in later stage funding rounds for promising growthn companies. Consumer internet, cloud computing for mobile softwareand services, and software-powered consumer electronics are among the areazs that will draw investments from the new “Across all of thesr categories, we are completely unafraid of all of the new busines models,” Andreessen writes.
“We believe that many vibrant new form s of information technology are expressing themselves into marketa in entirelynew ways.” And Andreesse n was equally emphatic about where his firm wouldn’t be . "We are almosr certainly not an appropriate investor for any of thefollowing 'clean,' 'green,' energy, transportation, life sciences drug design, medical devices), nanotech, movie productionj companies, consumer retail, electric cars, rockety ships, space elevators. We do not have the firs clue about any ofthese Andreessen-Horowitz will have the capacity to invest anywherw from $50,000 to $50 million in new companies.
He said that at leastr initially he and Horowitz would be the only two generalk partners inthe company, and they would be selective about the portfolio companies whose boards they join – generall y limiting that level of involvement to firmsz in which Andreessen-Horowitz have a $5 million or more Andreessen believes his and Horowitz’w records as entrepreneurs will make them ideal venture “We have built companies, from scratch, to high scalde -- thousands of employees and hundredws of millions of dollars of annual In short, we have done it ourselves.
And we are buildingf our firm to be the firm we wouldf want to work with asentrepreneurs ourselves,” Andreessehn writes. Andreessen founded the pioneering web browsetcompany , which was later sold to . Since he and Horowitz launched , a tech servics provider sold toin 2007. Netscape and Opswared sold for acombine $11.7 billion. The two have been activw investors in the tech spacwesince then. They’ve angel invested in 45 tech startups in the last five and Andreessen serves as chairman of and on the boards of Facebookiand eBay. Word that the pair would be formint their own venture capital firm was broke n on the Charlie Rose showin February. But detail s came on Monday.
The pair had initiallyy planned onraising $250 milliom for the fund, but investor interesty prompted them to boost the BusinessWeek . The news magazine reports thatReid Hoffman, founder of sociaol networking site LinkedIn, is among the investors in the which raised most of its moneu from institutional investors. Andreessen-Horowitz launche at a tough time for the venture capital one in which some are saying the industry needxsto shrink, not grow. Venture capital, like the rest of the financialk industry, has been hit hard by the economicf downturn. Venture firms make money when their portfoliop companiesgo public, or are sold to larger companies.
But the IPO marke has been anemic inrecent months, makinbg profitable exits more difficult to A recent argues that the industry needsw to trim down to regain effectiveness. "The ventured industry needs to shrink its way to becomingy an economic forceonce again," said Robertf E. Litan, vice president of Researcb and Policy at theKauffmam Foundation. “To provide competitive returns, we expectf venture investing will be cut in half in coming At thesame time, lowering valuationws and improving overall exit multipled should help resuscitate the The Kauffman study finds that despite such high-profil success stories as Google and , venturde firms have relatively little to do with most new Only about 16 percent of the 900 companies on the Inc.
500 list of fastesty growing companiesfrom 1997-2007 had venture backing.