The collapse of FTX left egg on the face of some famous venture capital firms, but Andreessen Horowitz, a.k.a. a16z, one of the best-known VC names and the world's biggest crypto investor, came out just fine. Does that reflect a16z's sound judgment—or just dumb luck? We'll never know since the firm is a big Coinbase backer, which precluded it from investing in FTX in the first place.
But while a16z may have dodged the FTX bullet, the firm's reputation as a crypto visionary is far from secure. As the Wall Street Journal noted last month, the value of a16z's crypto fund was down 40% in the first six months of 2022 alone—a decline that's no doubt even steeper in light of the recent market carnage. Meanwhile, some of its biggest crypto bets already look like busts. Those include Helium, the crypto-for-WiFi startup that has burned through hundreds of millions of dollars and become a cautionary tale of the limits of force-feeding people magic bean tokens. Then there is Dfinity (rebranded as Internet Computer), which raised $100 million from a16z in 2017 but has produced precious little besides bombastic marketing.
