
Invest Like the Best with Patrick O'Shaughnessy
Hosted by Patrick O'Shaughnessy
Written by a model from the transcript; not yet reviewed.
Ben Horowitz, co-founder of Andreessen Horowitz, discusses the state of America's tech sector, the coming impact of AI, and the firm's role in shaping the country's trajectory. He argues the tech sector is very healthy and that AI will transform everything within 12 to 24 months because no new infrastructure is needed for adoption. He identifies policy as the biggest risk, citing the near-outlawing of GPU sales under a Biden executive order, and argues technology solutions consistently outperform policy solutions. He reflects on how AI changes the "laws of physics" of company building, noting that you can now throw money at problems in ways that were previously impossible, as seen with Elon catching up on large models.
Horowitz shares stories about Andy Grove's management style, including the toilet paper anecdote from Intel's Santa Clara facility, and explains A16Z's founding strategy of building a product for entrepreneurs rather than just a fund. He discusses culture through the lens of Bushido, arguing culture is a set of actions not ideas, with specific behaviors like fining employees $10 per minute for being late to entrepreneur meetings. He also describes his personal funding of the Las Vegas Police Department's technology program, which achieved a 94% murder clearance rate and reduced crime by over 50%.
Policy as America's Biggest Riskinsight
Horowitz argues bad government can ruin a country regardless of talent or culture, citing Venezuela as the fourth richest country destroyed by communism. He notes the Biden GPU export executive order showed how close the US came to being out of the global chip game.
Cursor's Unprecedented Revenue Speeddata
Horowitz notes Cursor, an IDE, went over a billion dollars in revenue in a fraction of the time it took previous IDEs to reach that level, which took 12 to 15 years. He says revenue growth for AI companies is much faster than any technology products before.
Why AI Researchers Cost Hundreds of Millionsinsight
Horowitz explains that building large AI models is alchemistic and can't be learned in school, meaning there may be only about 40 people in the world who can do it. This scarcity justifies paying $100 million or even $1 billion for a single researcher.
Andy Grove's Toilet Paper Confrontationstory
Andy Grove visited Intel's worst-performing Santa Clara facility, put a roll of toilet paper under his desk, and told the team to clean up their bullshit. Within two months, the facility was up to code and became the highest rated thereafter.
Building a Better Product for Entrepreneursstrategy
Horowitz and Andreessen identified that venture capital was a great product for LPs but not for entrepreneurs. Their founding strategy was to build a firm designed to give founders enough confidence, network, and advice to actually be CEOs.
Culture Is Actions, Not Ideasstrategy
Drawing from Bushido, Horowitz argues that corporate values like integrity or do the right thing are platitudes unless defined by specific behaviors. At A16Z, that means never being late to entrepreneur meetings and explaining why you're not investing.
Nas Reveals the Cigar Metaphorstory
Nas paused Rakim's My Melody after the line about handing out a cigar, then played the next line: I'm letting knowledge be born. He explained it was a birth scene, a detail Horowitz had missed after listening to the song a thousand times.
Las Vegas' 94% Murder Clearance Ratedata
The Las Vegas Police Department, run by an elected sheriff rather than a mayor's appointee, achieved a 94% murder clearance rate compared to 75% in San Francisco and the national average below 60%. Horowitz personally funded their drone and AI camera program.
My guest today is Ben Horowitz, the co-founder of Andreessen Horowitz. Since its founding in 2009, a16z has grown into one of the most influential firms in venture capital, reshaping how technology companies are funded and how power and ideas move through Silicon Valley and around the world. This conversation focuses on sides of Ben’s story you don’t often hear. Ben reflects on the people who shaped him, including Nas, Andy Grove, and his father, and shares why he chose to personally fund new technology for the Las Vegas Police Department. We also talk about how he thinks about a16z’s responsibility in shaping the trajectory of America, the scale of his ambition for the firm, and what he sees as the biggest risk facing the country. Please enjoy this great and unique conversation with Ben Horowitz. For the full show notes, transcript, and links to mentioned content, check out the episode page here. ----- This episode is brought to you by Ramp. Ramp’s mission is to help companies manage their spend in a way that reduces expenses and frees up time for teams to work on more valuable projects. Go to ramp.com/invest to sign up for free and get a $250 welcome bonus. ----- This episode is brought to you by Vanta. Trusted by thousands of businesses, Vanta continuously monitors your security posture and streamlines audits so you can win enterprise deals and build customer trust without the traditional overhead. Visit vanta.com/invest. ----- Rogo is the AI platform for finance. They're building agents for Wall Street that are trained to understand how bankers and investors actually do work: from diligence and modeling, to turning analysis into deliverables. To learn more, visit rogo.ai/invest. ----- This episode is brought to you by WorkOS. WorkOS is a developer platform that enables SaaS companies to quickly add enterprise features to their applications. Visit WorkOS.com to transform your application into an enterprise-ready solution in minutes, not months. ----- Ridgeline has built a complete, real-time, modern operating system for investment managers. It handles trading, portfolio management, compliance, customer reporting, and much more through an all-in-one real-time cloud platform. Visit ridgeline.ai. ----- Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com). Timestamps (00:00:00) Welcome to Invest Like the Best (00:02:43) Episode Intro: Ben Horowitz (00:03:27) The State of America Right Now (00:06:06) How Policy Could Destroy America (00:08:29) AI Changes the Laws of Company Building and Investing (00:11:40) Why AI Researchers are Paid $100M (00:13:16) Thoughts on Growing Inequality (00:18:07) Societal Challenges Due to AI (00:19:56) Ben’s Scope of Ambition for the Next 20 Years (00:22:48) Andy Grove’s Influence on Ben (00:27:44) Starting Andreessen Horowitz (00:32:53) Early Mistakes (00:36:17) What Capital Markets Are Missing (00:37:44) Why VC and Not PE (00:40:03) Tradeoffs with Scale (00:41:10) A Culture is Not a Set of Ideas, it’s a Set of Actions (00:43:05) Lessons from His Father (00:45:03) Exciting Use Cases of AI (00:46:46) Ben’s Friendship with Nas (00:50:05) Funding New Technology for the Las Vegas Police Department (00:54:07) The Kindest Thing
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