The firm also made a series of promotions, including Dan Estes to General PartnerRead more...
Young Menlo Park venture firm now oversees $2.7 billion in funding
Startups looking to get off the ground and grab some venture funding are maturing in the right time since some firms are announcing they have secured some serious funding.
Partner at Andreessen Horowitz, Ben Horowitz confirmed in a blog post Tuesday that his firm now controls $2.7 billion in funding over the last three years it has been in existence. This means that in recent months, the firm has raised nearly $1.5 billion, one of the largest fundraisings in history.
Horowitz revealed that in 2011, the firm hosted over 600 portfolio presentations to corporate customers and partners at its office in Menlo Park. These presentations resulted in more than 3,000 introductions between portfolio companies and prospective Fortune 500/Global 2000 senior executives.
Now the firm has relationships with over 4,000 engineers, designers and product managers and has resulted in 130 hires within the portfolio. And Andreessen Horowitz has added over 550 executives to its network in 2011 and made more than 300 executive introductions to portfolio companies.
One of the founding principles in Horowitz's firm has been to support and ins tie confidence in the founding CEOs of these innovative startups, which he attributes a great deal of the company success in.
"In general, founding CEOs perform better than professional CEOs over the long term, and a venture capital firm that enables founding CEOs to succeed would help build the best companies and yield superior investment returns," Horowitz wrote in his blog.
Andreessen Horowitz has invested in companies from the seed stage like JR Rivers at Cumulus Networks to entrepreneurs with fast-growing enterprises like Airbnb.
Earlier this month, we reported about the strength across the VC market that showed a modest bump from the previous year. Venture firms based in the U.S. raised $16.2 billion across 135 funds in 2011, up 5% from a year ago, according to a report by Dow Jones LP Source. At the same time, however, fewer firms raised funds as the number of firms that raised new funding dropped by 12% last year.
The top five early-stage firms that raised funds include Khosla Ventures, which raised $1 billion in October, Founders Fund, which raised $625 million for early-stage investments, General Catalyst, which raised $500 million, Accel Partners, which raised $475 million and Redpoint Ventures, which attracted $400 million.
In Europe, fundraising looks even bleaker. Venture capitalists raised $3 billion across 41 funds in 2011, a drop of 20% in the number of funds attracting new capital and an 11% decline in the amount of capital raised compared to the prior year.
It's clear that Andreessen Horowitz is gearing up as a strong young VC firm with serious fundraising capabilities.
Read more from our "Fund News" series
The Israeli firm has invested in companies such as Phantom Auto, Cognata and Revel TransitRead more...
The firm now has $785 million in capital under managementRead more...
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We are company founders first and investor second: we have built companies from the ground up, including PayPal, Facebook, Napster, Plaxo, Palantir Technologies, and Clarium Capital. We have experience from concept to realization, from shared offices to public offerings. Every stage of the company creation process is familiar to us, from finding seed capital, to building defensible products, scaling up the organization, and realizing lasting value for employees and shareholders.
Our current investments include Facebook, Slide, Geni, Powerset, IronPort Systems, Zivity, Quantcast, and Project Agape. Our fund is $50 million and we focus on investments in early-stage consumer Internet companies. We typically invest $500,000 - $1 million per investment. At the end of 2007, we raised $220 million for The Founders Fund II.
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What is Twitter?
Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweets. It is free to sign up. Users then follow other accounts which they are interested in, and view the tweets of everyone they follow in their "timeline." Most Twitter accounts are public, where one does not need to approve a request to follow, or need to follow back. This makes Twitter a powerful "one to many" broadcast platform where individuals, companies or organizations can reach millions of followers with a single message. Twitter is accessible from Twitter.com, our mobile website, SMS, our mobile apps for iPhone, Android, Blackberry, our iPad application, or 3rd party clients built by outside developers using our API. Twitter accounts can also be private, where the owner must approve follower requests.
Where did the idea for Twitter come from?
Twitter started as an internal project within the podcasting company Odeo. Jack Dorsey, and engineer, had long been interested in status updates. Jack developed the idea, along with Biz Stone, and the first prototype was built in two weeks in March 2006 and launched publicly in August of 2006. The service grew popular very quickly and it soon made sense for Twitter to move outside of Odea. In May 2007, Twitter Inc was founded.
How is Twitter built?
Our engineering team works with a web application framework called Ruby on Rails. We all work on Apple computers except for testing purposes.
We built Twitter using Ruby on Rails because it allows us to work quickly and easily--our team likes to deploy features and changes multiple times per day. Rails provides skeleton code frameworks so we don't have to re-invent the wheel every time we want to add something simple like a sign in form or a picture upload feature.
How do you make money from Twitter?
There are a few ways that Twitter makes money. We have licensing deals in place with Google, Yahoo!, and Microsoft's Bing to give them access to the "firehose" - a stream of tweets so that they can more easily incorporate those tweets into their search results.
In Summer 2010, we launched our Promoted Tweets product. Promoted Tweets are a special kind of tweet which appear at the top of search results within Twitter.com, if a company has bid on that keyword. Unlike search results in search engines, Promoted Tweets are normal tweets from a business, so they are as interactive as any other tweet - you can @reply, favorite or retweet a Promoted Tweet.
At the same time, we launched Promoted Trends, where companies can place a trend (clearly marked Promoted) within Twitter's Trending Topics. These are especially effective for upcoming launches, like a movie or album release.
Lastly, we started a Twitter account called @earlybird where we partner with other companies to provide users with a special, short-term deal. For example, we partnered with Virgin America for a special day of fares on Virginamerica.com that were only accessible through the link in the @earlybird tweet.
What's next for Twitter?
We continue to focus on building a product that provides value for users.
We're building Twitter, Inc into a successful, revenue-generating company that attracts world-class talent with an inspiring culture and attitude towards doing business.
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Airbnb.com is the “Ebay of space.” The online marketplace allows anyone from private residents to commercial properties to rent out their extra space. The reputation-based site allows for user reviews, verification, and online transactions, for which Airbnb takes a commission. As of June, 2009, the San Francisco-based company has listings in over 1062 cities in 76 countries.
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Digg is a user driven social content website. Everything on Digg is user-submitted. After you submit content, other people read your submission and “Digg” what they like best. If your story receives enough Diggs, it’s promoted to the front page for other visitors to see.
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Khosla Ventures offers venture assistance, strategic advice and capital to entrepreneurs. The firm helps entrepreneurs extend the potential of their ideas in both traditional venture areas like the Internet, computing, mobile, and silicon technology arenas but also supports breakthrough scientific work in clean technology areas such as bio-refineries for energy and bioplastics, solar, battery and other environmentally friendly technologies. Vinod was formerly a General Partner at Kleiner Perkins and founder of Sun Microsystems. Vinod has been labeled the #1 VC by Forbes and Fortune recently labeled him as one the nation's most influential ethanol advocates, noting "there are venture capitalists, and there's Vinod Khosla." Vinod Khosla founded the firm in 2004.
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Zynga is the largest social gaming company with 8.5 million daily users and 45 million monthly users. Zynga’s games are available on Facebook, MySpace, Bebo, Hi5, Friendster, Yahoo! and the iPhone, and include Texas Hold’Em Poker, Mafia Wars, YoVille, Vampires, Street Racing, Scramble and Word Twist. The company is funded by Kleiner Perkins Caufield & Byers, IVP, Union Square Ventures, Foundry Group, Avalon Ventures, Pilot Group, Reid Hoffman and Peter Thiel. Zynga is headquartered at the Chip Factory in San Francisco. For more information, please visit www.zynga.com.
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BlueStacks enables Android applications to run on Windows machines. BlueStacks’ technology can be integrated into offerings for both the consumer and commercial (enterprise) market segments. Incorporated in March 2008 by leaders in Microsoft Windows, mobility and Android development, BlueStacks is privately held and headquartered in Silicon Valley with global offices in India, Japan and Taiwan.