“Hey Satya, should I write a post about the most influential VCs of the decade?”
“Sure, expect a lot of opinions :)”
We’re just a few weeks from the end of the 2010’s. Now the calendar-truthers will tell you that the switchover from 2020 to 2021 is more significant because that’s the *actual* beginning of the new decade, but come on, time is a flat circle and we all know moving from a —9 to —0 is a bigger deal. So as reporters and pundits start their “Best of the Decade” lists, I’m turning the gaze inward and asking the question, “Who Were the Most Influential VCs of the 2010s?”
NOW, this isn’t the “best” VCs of the decade. Or the most famous. Or the nicest. Instead it’s just my hot take on who were the handful that had the biggest impact on my industry. This doesn’t even necessarily mean they had the biggest impact on tech (let’s stop thinking that venture capitalists are the butterflies whose wings cause typhoons). But their actions, choices and words did, in my opinion, create changes that cascaded over the investment class. Sometimes in ways they intended and perhaps in some other cases, in ways they couldn’t have even anticipated!
[Deep breathe] In alphabetical order, here are the MOST INFLUENTIAL VENTURE CAPITALISTS OF THE 2010s
Marc Andreessen & Ben Horowitz
a16z played disrupter, launching their first fund in 2009, based on a bold set of statements which, even if they were not individually unique, had never been combined before into a firm. They’d offer services like recruiting, sales and BD help, and marketing to their startups, building out an agency-like model and employing well over 100 team members. All of their partners had to be former founders (since relaxed), sounding the bell that not just operators, but founders, would make the best investors. And since there were only a handful of companies which truly mattered each cycle, you couldn’t “overpay” to get into them, you had to be in them – thus capital and brand would be weapons, pushing other VCs to raising the magical “billion dollar fund” or be left without the dry powder to stare down Marc and Ben.
Now as we enter the 2020s, the majority of large firms have some operating support, core + opportunity funds that tip well past $1b and promote themselves with content and conversation. The message to them was clear – you don’t have to play a16z’s game but you can’t ignore them.
Over the course of the 2010s, seed investing went from a clubby handful of individuals and “micro VCs” to an outpouring of capital and multi GP firms. The institutionalizing of seed financing was driven by the aptly-named First Round Capital which Josh co-founded and for a long while, was clearly the visible frontman of the group. First Round went deep on “platform” far ahead of anyone else in this stage. They are also the first of the early stage seed funds to really plunge into a generational transition, as the initial GPs have started to step back. Will seed VC be a multigenerational game? Remains to be seen industry-wide, but LPs and other firms are looking to FRC as bellwether of how to do it.
The money cannon currently being shot at early stage companies (and funds like mine) owes a lot of its success to Josh’s vision and now the big multistage funds have come down market as well to try and get a piece…
Aileen could be on here as an example of large fund GP breaking away to start their own firm – which is clearly another trend of the 2010s – but I’m actually including her for coining the term ‘unicorn’ (companies which have hit $1b threshold in private valuations). In doing so, Aileen didn’t just give a name to a phenomena transpiring, she played a role in catalyzing an aspirational target for companies and investors to hit — “unicorn status.” Funding rounds, press headlines, even recruiting pitches, all sought to declare “XYZ is a unicorn.” The observation of unicorn inflation caused more unicorns to be created! Talk about unintended consequences.
The next few years – maybe even the next decade – are going to be about these highwater valuation marks being tested — by the public markets, by potential acquirers, by common shares under a preference stack. And without a doubt, Aileen’s smart analysis influenced years of investing behavior.
Ellen K. Pao
Ellen’s might have lost her lawsuit but the filing itself started an avalanche. Whisper networks became real conversations and firms up and down Silicon Valley started addressing their “women problems” – basically, that they didn’t have many among the managing and senior partners of their firms. While we’re nowhere near parity – and female entrepreneurs are still dramatically suffering as a percentage of venture-backed dollars – the landscape looks very different than it did before Ellen stepped up. And I can’t imagine it going back.
Hopefully the work of Project Include, All Raise and other groups make the term “underrepresented community” an anachronism before the next decade is up.