Andreessen Horowitz has set aside nearly $500 million for Indian startups. The Silicon Valley-based also plans to hire for several investment roles in the country.
Andreessen Horowitz, which made its first investment in India last year, intends to be aggressive in the world’s second largest internet market. The Silicon Valley-based venture capital firm has set aside $500 million to invest in Indian entrepreneurs.
According to people familiar with the situation, the business, which led a funding round in the Bengaluru-based cryptocurrency exchange CoinSwitch Kuber last year, is also looking to employ for multiple investment opportunities in the nation. A number of partners at the firm, including Seema Amble and Sumeet Singh, have been working with multiple Indian companies in recent months, according to people familiar with the situation, who asked to remain anonymous because the topic is private.
According to one source, the business, which announced in January that it had secured $9 billion for its venture, growth, and bio funds, is considering a $250 million investment in an Indian startup that offers an opinion exchange platform. According to another source, it has also collaborated with a Bengaluru-based early-stage fintech.
According to an investor in a top-tier Indian fund, we’re “beginning to see them look more seriously.” If the firm, known colloquially as a16z, goes ahead with the plan, it will be the latest high-profile investor to become actively involved in India, which is home to 100 unicorns and where tech behemoths Google, Facebook, and Amazon have collectively deployed at least $20 billion over the last decade.
For years, Andreessen Horowitz has been researching markets such as India, and it has been transparent about the challenges of entering new markets.
Six years ago, a16z co-founder and general partner Marc Andreessen (shown above) claimed it was “very enticing” to finance businesses in emerging markets in a seminar at Stanford Graduate School of Business. However, he added that it was difficult for a venture fund to extend into other countries.
According to venture capitalists, “Very hands-on method of understanding the individuals you’re working with for both evaluating the company and working with the company. If it continues to be a hands-on business like that, there is the issue of geographic remoteness, which is that if I’m not there in another geography, do I really know those individuals to make decisions?
As a result, a number of companies have attempted to employ local teams. But there’s also the underlying issue that if the local team is truly strong, they may easily leave and start their own businesses. If they are awful, they continue to work for me…which has its own set of problems.”
With valuations in the private (as well as public) markets correcting, now would be a good time for the firm to pursue investments in the country.