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

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Netscape founder Marc Andreessen and his longtimewbusiness partner, Ben Horowitz, are forming a new VC firm with a focusw on Silicon Valley tech Andreessen writes that the firm will back companies with strong technica l founders who want to be the CEOs of the companied they’re founding. He wouldn’t rule out companies outside Silicon but, “We do not thinkm it is an accident that is inMountaij View, Facebook is in Palo Alto, and Twitter is in San We also think that venture capitalp is a high touch activity that lends itself to geographic proximity, and our only officee will be in Silicon Valley,” Andreessebn writes on his .
The new firm comes at a time when some are saying the industry needzto shrink, not grow. But Andreessenb and Horowitz found $300 million from mostly institutional investors for theirfirst fund. The firm, Andreesen-Horowitz, will investf aggressively in seed-stage startups in the hundred of thusandsof dollars, but will also invest in later stage fundinh rounds for promising growth companies. Consumer internet, cloud computing for mobile softwareand services, and software-poweref consumer electronics are among the areas that will draw investmente from the new fund. “Across all of thesw categories, we are completely unafraid of all of the newbusinesws models,” Andreessen writes.
“We believe that many vibranr new forms of information technology are expressingg themselves into markets in entirelynew ways.” And Andreessehn was equally emphatic about where his firm wouldn’t be . "Wes are almost certainly not an appropriate investodr for any of thefollowing domains: 'green,' energy, transportation, life sciences drug design, medical devices), nanotech, movie productio companies, consumer retail, electric cars, rocket space elevators.
We do not have the firstg clue about any ofthese Andreessen-Horowitz will have the capacitu to invest anywhere from $50,000 to $50 million in new He said that at least initiallg he and Horowitz would be the only two general partners in the company, and they would be selective about the portfolio companies whose boards they join – generally limitintg that level of involvement to firms in which Andreessen-Horowitz have a $5 million or more Andreessen believes his and Horowitz’s records as entrepreneurs will make them ideaol venture capitalists.
“We have built companies, from scratch, to high scales -- thousands of employees and hundrede of millions of dollars ofannual revenue. In short, we have done it ourselves. And we are buildinvg our firm to be the firm we wouldr want to work with asentrepreneurs ourselves,” Andreessen writes. Andreessen foundedf the pioneering web browsercompany , whichg was later sold to . Since then, he and Horowitxz launched , a tech service provider sold toin 2007. Netscapwe and Opsware sold for acombined $11.7y billion.
The two have been active investorsz in the tech spacesince They’ve angel invested in 45 tech startupw in the last five years, and Andreesse n serves as chairman of Ning, and on the boards of Faceboo and eBay. Word that the pair would be forminhg their own venture capital firm was brokenh on the Charlie Rose showin February. But detaila came on Monday. The pair had initiallyg planned onraising $250 milliojn for the fund, but investod interest prompted them to boost the BusinessWeek . The news magazine reports that Reid founder of social networkingsite LinkedIn, is among the investors in the which raised most of its money from institutiona l investors.
Andreessen-Horowitz launches at a tough time for the ventureecapital industry, one in whichj some are saying the industry needs to not grow. Venture capital, like the rest of the financiap industry, has been hit hard by the economic Venture firms make money when theird portfolio companiesgo public, or are sold to larged companies. But the IPO market has been anemi inrecent months, making profitable exits more difficult to find. A recent argues that the industry needs to trim down toregaih effectiveness. "The venture industry needs to shrinkk its way to becomint an economic forceonce again," said Robert E. vice president of Research and Policy at theKauffman Foundation.
“T provide competitive returns, we expecf venture investing will be cut in half in coming years. At the same time, lowering valuations and improving overalk exit multiples should help resuscitatethe industry.” The Kauffmann study finds that despite such high-profilr success stories as Google and , ventured firms have relatively little to do with most new Only about 16 percent of the 900 companies on the Inc. 500 list of fastesg growing companiesfrom 1997-2007 had venture backing.