// TECHCRUNCH — INTELLIGENZA ARTIFICIALE
Will the DOJ’s investigation into a16z spook other VCs?
Following a Bloomberg report that the Department of Justice is investigating venture firm Andreessen Horowitz for holding board seats with rival AI companies, VCs told TechCrunch that they were baffled.
On the latest episode of the Equity podcast, Kirsten Korosec, Sean O’Kane, and I were similarly puzzled by the news. Yes, VC conflicts-of-interest are worth taking seriously, but as Kirsten wondered, “Of all the things that the DOJ would focus on in terms of level of importance, why does this one rise to the top?”
The news was also surprising because of a16z’s ties with the Trump administration, and because the firm has been so quiet about the investigation. It’s a real contrast with the firm’s activity during the Biden years, when — as Sean put it — “every little policy change, especially related to crypto, generated a day’s worth of posting.”
But Sean also speculated that by targeting a16z, the DOJ might also be setting an “example” that “smaller firms would follow.”
Keep reading for a preview of our conversation, edited for length and clarity.
Kirsten Korosec: I think that you bring some interesting perspective to this, Anthony, because you actually worked at a VC firm, whereas Sean and I have never been inside the confines of the VC world. We’ve only reported on it.
Anthony Ha: Long-time equity listeners will know that I did spend a couple years working at an early stage VC firm — a much smaller firm than Andreessen Horowitz, as different as you can be while still technically being in the same industry.
It did color my response when I was reading this article, which is essentially about these board seats that Andreessen Horowitz holds, and the idea that they have board seats in some companies that have become competitors.
It was really surprising to me, as apparently it was to a number of other VCs. And again, I’m not a lawyer, I was not on the legal team of this VC firm. There is, obviously, an understanding, and apparently laws, around the idea that you should not be on boards of competing startups. But this is not something that is, generally, enforced very closely.
Founders don’t feel great if you are on the board of their biggest competitor. But also, startups evolve. And I think that was true in this case — you invest in a startup doing one thing, and then, say, the AI boom happens, and suddenly they’re doing something completely different. So the idea that you would have a year-long DOJ investigation into this — we don’t really know what the results are, there’s a lot of questions about this, but it just seems very strange.