Preservation of Equity in Venture Capital

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Venture firms risk having strips of their equity stripped away annually, making it unsustainable in the long term. A 25% annual unrealized gains tax for 10 years can lead to the loss of equity and eventual failure of the firm. This scenario makes startups less attractive compared to working for established companies like Google. The model becomes implausible, leading to the disappearance of venture capital firms like the speaker's.

Welcome to "The Ben & Marc Show," featuring a16z co-founders Marc Andreessen and Ben Horowitz. In this new episode, Marc and Ben discuss their latest article, “The Little Tech Agenda,” and why the future of American innovation is at a critical juncture.

In a one-on-one conversation, Ben and Marc compare the policies of Donald Trump and Joe Biden regarding Little Tech, explore the potential futures for blockchain, crypto, and AI, and examine how tax policies could shape the future of startups and venture capital. They also address the recent assassination attempt on President Trump and reveal which candidate they’ll be supporting in the upcoming election. Enjoy!

*Read “The Little Tech Agenda”: https://a16z.com/the-little-tech-agenda/

Book mentioned on this episode:

- “Men, Machines, and Modern Times” by Elting Morison https://amzn.to/4f4eWrt

Watch the FULL episode: https://youtu.be/n_sNclEgQZQ

Resources:

Marc on X: https://twitter.com/pmarca

Marc’s Substack: https://pmarca.substack.com/

Ben on X: https://twitter.com/bhorowitz

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