Ben Horowitz argues that waiting a decade for fund outcomes is too slow. Instead, a16z judges investors "at the point of attack"—how good they are at finding and winning deals with exceptional founders. This focuses on decision quality in the present, not lagging indicators.
Ben Horowitz states a common VC mistake is over-indexing on a startup's weaknesses. The better investment is a team that is unequivocally the best at a single, critical thing. Being "pretty good" at everything is a red flag, as greatness in one area is what drives extraordinary outcomes.
Ben Horowitz suggests a leader's primary role in decision-making is often to provide clarity, which unblocks the team and allows them to move forward. The organization needs a clear direction more than a perfect answer. This is achieved by staying in the details and being accessible, not by dictating every solution.
A16Z’s verticalization was driven by a principle from legendary investor Dave Swenson: an investing team shouldn't exceed five people. This small size ensures that investment discussions remain true conversations, preventing them from becoming unwieldy presentations and preserving decision quality as the firm scales.
While many fear an AI bubble, Ben Horowitz argues that current valuations are supported by fundamentals. Unlike past cycles, the customer adoption and revenue growth rates for AI companies are unparalleled. This historic demand justifies the rapid value creation, suggesting it's more than just speculative inflation.
The belief that a single, god-level foundation model would dominate has proven false. Horowitz points to successful AI applications like Cursor, which uses 13 different models. This shows that value lies in the complex orchestration and design at the application layer, not just in having the largest single model.