Andreessen Horowitz, also known as a16z, is one of the most well-known venture capital firms operating in Silicon Valley, and is now expanding into even newer territory.
a16z is launching START, a startup acceleration program for first-time founders who want to get their idea off the ground and into reality.
“Powered by the a16z seed fund in collaboration with partners investing in American dynamism, consumer, enterprise and fintech, a16z meets START entrepreneurs where they are at in their journey,” the company said in announcing the news.
“a16z START entrepreneurs are introduced to a network of peers, repeat founders, domain experts, potential clients and more to help them refine their thesis and turn it into a world-changing business.”
Solve old problems?
The basic idea is that a16z offers founders up to $1 million in the early stages of their journey for a percentage stake in their company. These are funded by a16z’s $400 million seed fund, announced in 2021.
Specific terms are decided on a case-by-case basis, which differs from other accelerators, like the legendary Y Combinator, which offers $125,000 for a 7% stake.
The a16z program is remote and rolling, which means it will accept founders at any time.
Like Tech Crunch notes, the a16z START landing page does not offer any diversity mandate or specify the duration of the program or who will mentor startups.
Nor is there a focus on attracting early-stage crypto startups, something a16z has been heavily focused on through its massive $2.2 billion fund.
The START program is a first for a16z, which has previously invested in seed-stage startups. Working in the formation stage of the startup is different because ideas are less defined and investors bet on which specific founder to execute.
However, the returns are much higher for a much lower capital investment, which has allowed YC – which has invested in Airbnb, Stripe, Instacart, Coinbase, DoorDash, OpenSea and many others in its early days – a lot of money over the years.
Legendary venture capital firm Sequoia also recently launched an accelerator fund, Arc, in the US and Europe in hopes of attracting the next generation of huge tech startups. Like a16z, Sequoia will invest $1 million for an unspecified stake.