Lunch with the FT: Marc Andreessen

The Netscape founder and tech investor talks about the trouble with stock markets, what he looks for in entrepreneurs and why illegal immigration is good for America

Keen to avoid the San Francisco traffic, I arrive half an hour early at Tamarine, a sophisticated modern Vietnamese restaurant in Palo Alto. At 12.27pm, three minutes before he is due, Marc Andreessen texts from his car: “Be right there :-)”

As I contemplate the billionaire venture capitalist’s fine Midwestern manners, there is another beep. “Oops,” it reads. “Just got pulled over for cellphone violation for sending that email :-). No good deed goes unpunished :-).”

I prepare to wait. Tamarine has dark-panelled walls and spotlights illuminating orchids on each table. Cordoned off by an olive velvet curtain, I tune in and out of a conversation between tieless French executives about ebooks. Just before 1pm, Andreessen emerges from behind the curtain. At 6ft 4in and wearing a gingham shirt, he is unmissable: a genial man with a serene manner, unruffled by his encounter with the police who had pulled over his two-year-old Tesla, and in no hurry to order.

He asks what I have been struck by on this visit to Silicon Valley, and, when I cite its collaborative culture, he beams as if it is a personal compliment. “I couldn’t believe that people were volunteering to help [me],” he recalls of his own arrival 20 years ago. “It didn’t match anything where I grew up.”

In the 1990s he worked as a student programmer on Mosaic, one of the first internet browsers. In 1993 he moved to California for a job and met James Clark, who thought Mosaic could be commercialised. The company changed its name to Netscape, going public in 1995. Aged 24, Andreessen was worth $58m. The following year he appeared on the cover of Time magazine’s “Golden Geeks” issue, immodestly sitting atop a golden throne, barefoot.

“I’m terrible at self-introspection,” he confesses, as a spotlight creates a distracting halo on his bald head. “I had a sense, early on, I could build things be­cause I got involved early in computers and coding. The big discovery of my life was when I came to the Valley and discovered people would fund you to do it.”

He has since made his name as an investor, privately and co-founding Andreessen Horowitz, a $4bn venture fund, in 2009. His investments include Facebook, Skype, Airbnb and Twitter.

It is a long way from his small-town roots in New Lisbon, Wisconsin, when he recalls considering Chicago a “big cosmopolitan city, with all the fancy people”. His extended family farmed in Iowa. His father, Lowell, sold seed corn for an agricultural company; his mother, Patricia, was a housewife. “If you don’t plant the fields on time or get the fertiliser out, you have a real problem. You can’t talk yourself out of it — there goes your farm. People are incredibly practical, hard-working. Deferral of gratification is a huge thing. Calvinism runs very deep. It sets you up pretty well for engineering.”

He refers enthusiastically to an essay by Tom Wolfe about Robert Noyce, Intel’s founder and an Iowa farm boy. Wolfe links Intel’s open ethos and its cubicle culture to the egalitarianism of the farm. “When I finally read that, I was, ‘Oh!’ ” Recognition.

As a child, Andreessen was fascinated by technology. “I have the complete series of Tom Swift from the 1910s to 1950s in my office. That was probably the single most important thing I read,” he says of the science-fiction and adventure books featuring a teenaged inventor hero (Tom Swift and his Photo Telephone was one 1912 title). “I liked all the stuff he’s inventing.”

He counts himself as fortunate to be born in the 1970s: he was six when the Apple II was entering American culture. His first PC came from Radio Shack. “I managed to get enough money together to buy the $300 TRS-80,” he recalls.

He was also fortunate in his decision to study engineering at the University of Illinois: as one of just four sites funded by Congress to host $20m to $40m supercomputers in the mid-1980s, it had funds for “the intercept-net, which became the internet”.

Andreessen sees technology as enabling what he calls the “great awakening”. Waggling his iPhone affectionately, he says: “This little guy right here is the equivalent power capability of the $20m supercomputer I was using. This thing is in two billion people’s hands.”

One of Andreessen’s most visible uses of that power is Twitter. He began tweeting in earnest a year ago. Within six months he had posted 22,300 tweets, and now, according to Bloomberg, averages more than 100 a day to his almost 250,000 followers. Does he write all his own tweets? “I would never give anybody access to my Twitter account. That would be crazy.”

Some people might wish he would cede more control. His interests on Twitter are promiscuous, ranging from multi-part tweet epics on economics to immigration. His tech-optimism attracts both admiration and mockery. Last June, a Salon article said he used Twitter as a “personal pulpit for delivering Silicon Valley’s version of the Sermon from the Mount”. Carl Icahn, the activist investor with whom he had a public spat over his eBay board role, sniped that Andreessen “talks with a high squeaky voice that only a dog can understand”, a quote Andreessen has appropriated for his Twitter biography.

In person, it is not so much his voice as the speed at which he talks that makes lunch like navigating conversational rapids. He rushes at sentences, starting so many with “And”, or “So”, it is as if his speech cannot keep pace with his ideas. The transcript of our two-hour conversation comes to 20,000 words. Some of his answers are close to 1,000 words long: generally eloquent, sometimes repetitive, often provocative.

After one breathless monologue about Asia he suggests, to my relief, that we order. He plans to “eat light”. He says “the food is incredibly good; very healthy. I’m a fully adapted Californian so I’ve done the full 180, from cheeseburgers and French fries for every meal, all the way through to this.”

As the waitress comes over, Andreessen orders “shaking beef”, with curried long beans and iced tea. I ask if he always orders the same thing. “I’ve drained all the unpredictability out of as much of my life as possible, because the unpredictable parts are unpredictable enough. I’m really boring. My wife and I have no social life. We don’t travel. We don’t go on vacation. We don’t go out.”

I order shrimp spring rolls, shaking beef, coconut rice and kiwi mint “fresco”. Andreessen continues on the theme of how mundane his social life is for a plutocrat. “We eat at home almost every night. We watch an unbelievable amount of TV or movies.” He gossips about The Honourable Woman series, and attributes the creative renaissance of television to its expanding internet audience. “Today, you’re also selling to Netflix and Amazon and Microsoft and Sony and Yahoo.”

He likes television, he says, because it puts the writer in charge, and compares it to the best tech companies which are also built when you put founders in charge for long periods. “By the way, writers are often crazy; they’re unpredictable, they don’t necessarily operate on a budget or timetable you might want. They argue a lot. Which is the same thing we deal with, with founders. But you get the magic.”

Founder-worship is fundamental to Andreessen’s psychology and central to his identity as a venture capitalist. He gets 2,000 pitches a year, backing around 15. He typically looks for entrepreneurs with engineering training. “We look for the ones who have been programming since 10.”

I eat the light and delicious spring rolls as Andreessen clunks his ice with his straw. I ask if there is an issue with the lack of female entrepreneurs. “It depends what you mean by issue,” he counters. “We have all heard horror stories of what individual women have gone through when they’ve come to Silicon Valley.”

I ask for an example. He bristles. “Do research online! I’m not going to give you an example.” I’m not asking for a name, I explain. “I’m not going”, he retorts, unmollified, “to finger anybody!”

While the position of minorities and women are obviously things Andreessen has thought about, he is bluffly dismissive of too much hand-wringing. “In 2004, it was outsourcing. In 1989, it was Japan. Now it’s China. There’s always some bogeyman. I think the destiny of the US is in our hands.”

All will be well, he says, provided we allow more technology. “If we don’t get it quite quickly, we will not be able to afford things like social security, Medicare. We need far higher productivity for the shrinking percentage of people who are going to be working.”

Does he think there is a backlash against powerful tech companies? He leans forward to deliver a history lesson. After the internet bubble burst, political interest evaporated; fortune-hunting East Coasters left. By the late 2000s, tech returns: “Facebook is developing. The iPhone comes out, Android, wi-fi. People outside the Valley all of a sudden are, ‘Holy shit, it’s actually working!’ ”

The waitress interrupts with our main course. Andreessen tucks in, wielding chopsticks: “It’ll probably be my last chance of eating.” Though I offer to talk so he can eat, he ignores me, targeting a bean. “And, so, it’s a shock, and then it’s a recalibration of power. What does this mean for cultural power? What does this mean for economic power?”

I tackle my beef, which is also delicious, with a fork. Andreessen, eating less, often pauses to hold a piece of beef aloft in his chopsticks for minutes as he talks. He is dismissive about fears of a bubble. “The minute anything works in tech, analysts, reporters, people in TV, immediately [say] it’s a bubble.”

“There is no backlash,” he continues: technology companies remain popular with the public. “There is only the tech backlash of the New Yorker and the New York Times and of the New Republic and of Harvard University.”

I ask why he thinks it is coming from there. “They’re threatened. It’s a power recalibration. There’s a coastal element to it. There’s a liberal arts versus engineering element to it. It’s a two-cultures thing. It’s a CP Snow thing.” Snow, a British chemist and novelist, in the 1950s identified two camps: a liberal arts culture and a science one.

Andreessen is excited, jiggling his leg and waving his empty chopsticks. Is there still a battle? “No question. At the University of Illinois, there’s Green Street, and to the north is the engineering campus and to the south the liberal arts campus. To the north, it’s all money. To the south, the buildings are falling down. And it’s like almost entering a different world to take a history class. Right there on campus, you can see it. You can see this at other universities.”

He is intrigued by Snow’s notion of a third culture, with technologists engaging in cultural issues, and vice versa. “We need more of this.” He clearly enjoys his own excursions into the “humanities media”, with investments in BuzzFeed and Reddit, and making sweeping media forecasts.

“Business journalism ought to do extremely well … [people need to] know what’s going on.” But “for general news people want their biases and prejudices confirmed”. He goes on to advise the FT to ditch print entirely.

“I’m trying to train myself not to make news,” he says, his role as Twitter provocateur notwithstanding. “People who love me and care about me [say], ‘Marc, you can talk about these issues without singling out people.’ ” Who, I probe, are these people? “See, once again, you’re trying to get me to swill.”

He slides his plate away, unfinished. “I’m not an early riser and I had a huge breakfast,” he explains. The end of our food does not signal lighter conversational fare. Over lunch, he has cited biographies of Joe Kennedy, papers by economist Richard Thaler; he now offers his opinions on demography.

“Societies are going to get richer; all the birth rates are going to drop. Japan is a harbinger of all of our futures.” In the US, growth would be slowing were it not for “illegal immigration. It’s the best thing that can possibly be happening to us, and I find it ironic; nobody wants to talk about that.”

Then Andreessen turns to public stock markets (he sits on several boards, such as those of Facebook and HP). His biggest worry? “There are so many people paid to make the problem worse: paid to regulate, to short-sell; to activists, to the governance experts, to the analysts. The pressure that comes to bear when you’re a public company is just astonishing and it comes at you from a dozen dimensions and you’re, “I can’t believe all these people are out there getting paid to attack me like this.”

Despite the touch of paranoia in his answer, Andreessen has thought deeply about finance. Stock markets are now too risk-averse and snarled by regulation, he says, which means public investors “won’t get the returns”. Besides, tech groups have access to multimillions of private capital to fund growth, so have less need for public markets. Any gains, therefore, accrue to a narrow group of wealthy private investors, such as Andreessen, rather than pension funds.

“Microsoft went public in 1986, valued at $300m. It went to $300bn. Public shareholders got a thousand-time rise. When Google went public in 2004, it had about a $30bn valuation and went to about $300bn. Investors got about a 10-time rise. Facebook went public at about $100bn. It’s now $200bn, so public investors have had a two-time rise.” I suggest he seems content living with risky investments. He agrees. “But I’m weird. I’m different. I’m unusual. Most people want to live in a world where there’s no risk. Most people want to invest their money and not have it fall.”

I spot Andreessen checking his giant watch. He has 10 minutes — enough for Bitcoin. He says he is confident the cryptocurrency could “do for financial services what the internet did for content services, ecommerce”. London has the chance to develop a special economic zone to aid Bitcoin. If not, “it’ll happen in Israel, Lebanon, India, Japan.”

He says little keeps him awake at night, despite his restless energy. “I sleep six to eight hours. I catch up on the weekends. I’m a big napper, so I get a lot mid-afternoon. I go out for the count. I’m generally pretty happy. I’m extremely optimistic about the progress of technology.”

He leaves as I pay, but soon sends a text about an app that fights your parking ticket for you, confirming his faith: tech has an answer for everything.

This article was first published on on January 16, 2015. The author is Caroline Daniel, who was the editor of FT Weekend. The illustration is by James Ferguson.

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