On Portfolio’s Potential, Andreessen Horowitz Prepares to Raise Second Fund

Despite few exits to date as either institutional or individual investors, Marc Andreessen and Ben Horowitz expect to raise their second venture fund later this year, according to The New York Times.

Since closing its $300 million debut fund last June, Andreessen Horowitz has backed 24 companies and committed two-thirds of its capital, including $50 million used to acquire less than 5 percent of Skype last fall. (Andreessen Horowitz was part of a consortium led by Silver Lake Partners that bought a controlling interest in the Internet call carrier from eBay.)

At the time of the acquisition, Andreessen told peHUB, “One of the big pieces of input we got when raising the fund was to be responsible, but not conservative. We want to calibrate risks against big opportunities, and we think [Skype] is a very big opportunity.”

Assuming the firm is successful in quickly assembling a second fund — its first offering took just three months to close — its LPs will be reinvesting on the promise of the Andreessen Horowitz team and the portfolio they have assembled.

Though the firm hasn’t enjoyed any exits in the past year, its holdings, in addition to Skype, include a stake in the social games company Zynga. Andreessen Horowitz has also participated in the seed rounds of numerous startups, including still-stealth Canvas Networks, the massively multiplayer game maker Tiny Speck, and Factual, a platform that invites people to contribute and mash open data.

It won’t be the first time the firm’s LPs will bet almost solely on the potential of a portfolio assembled by Andreessen and Horowitz, who burst onto the venture scene last year after successful and high-profile entrepreneurial careers, including at Netscape and the software company Opsware.

While Andreessen is an angel investor in two of the hottest companies on the planet — LinkedIn and Twitter — his personal portfolio, along with that Horowitz, offers “no exits to report,” says Andreessen Horowitz partner Margit Wennmachers, who emailed me on their behalf to address questions. (Andreessen has been investing in startups for more than a decade, including the once-popular group-buying site MobShop, which raised $51 million before shuttering in 2001.)

Whether forgotten or too inconsequential in value to mention, it does appear that Andreessen and Horowitz have seen at least two exits. According to their own records, released last year, they made personal seed investments in the early social bookmarking Web service Delicious, acquired for an undisclosed amount to Yahoo in 2005, and in Mechanical Zoo, the question-and-answer site that was later renamed Aardvark and that sold to Google last December for $50 million after raising a collective $6 million.

Their personal stakes also include the social media companies Digg and Meebo and headset maker Aliph. And Andreessen, who last year conceding missing an opportunity to fund Facebook, holds a small ownership position in the social media giant as a member of its board, which he joined in 2008.

Asked this afternoon about the firm’s second fund, Wennmachers called it “way early,” and to “stay tuned.”

In addition to dropping the news that it is raising a sophomore fund sometime this year, Andreessen Horowitz earlier today announced they’ve hired another GP, business development executive John O’Farrell, as well as a recruiting partner, Jeffrey Stump.

Wennmachers, cofounder of Outcast Communications, joined the firm last week as marketing partner.

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