Mobile Internet brings huge market base

Absrtact: Andreessen Horowitz (a16z) is one of the best VC companies in Silicon Valley, and almost every major technology financing will have the presence of the VCs, leading to the so-called Andreessen Horowitz effect. Now, the VC has made a

Andreessen Horowitz (a16z) is one of Silicon Valley's top VC companies, with almost every major technology financing that could have led to the so-called Andreessen Horowitz effect. Now, the VC has made new judgments about future technology trends, and a16z that the size of the market that the current generation of technology companies are likely to create will dwarf those of previous companies. To this end, the VC has just completed a new round of the 1.5 billion-dollar multi-stage venture capital financing, in order to seize new investment opportunities to accumulate sufficient firepower.

(i) Mobile internet brings huge market base

a16z that the key reason for the imminent opportunity for new ventures is the bursting of the mobile internet. Internet users are about to reach 3 billion. Smartphone users are expected to grow from the current 1.5 billion to 5 billion in the next few years. It is precisely because of this huge market base that modern, successful technology companies are much larger than the companies of the past decades.

(ii) BYOD and cloud computing with hot business market

While the market is growing, the technology costs underpinning these companies are falling, thanks to the impact of developer productivity tools and cloud computing. Especially on the enterprise side, the market opportunities for technology companies are increased by the advent of SaaS and BYOD-because previous enterprise applications typically require client deployment on end user side, and the installation, support, and management of end-user side client software limits application development, The SaaS model allows large organizations to freely find and adopt new technologies without being constrained by the ability of the IT organization to support them. So the popularity of mobile devices and cloud computing has spawned a whole new enterprise application market.

Another important development a16z mentioned is the subversion of traditional industries by software. This will also provide new opportunities for VC business expansion. In fact, Andreessen's language about software encroaching on the world is becoming reality. As Netflix slowly eats into the television market, the music market is dominated by itunes, Spotify and Pandora, and Amazon has started to challenge Wal-Mart in the retail arena, and Disney's Pixar has been swept away in the film world. a16z that more technology companies will penetrate the vertical areas of health care, education, financial services, energy and even government services in the coming years, much like Kleiner's Daniel Liem. Software is slowly implanted into all industries as an unstoppable gene.

(iii) Full stack of new benchmarks

The whole stack of startups ("full stack" startups) is a term coined by Chris Dixon, the so-called full stack venture, which refers to a new form of technological entrepreneurship. In the past, when startups developed new technology, because of capacity or size problems, generally take the sale of technology or authorization to achieve technology to end users and the promotion and profitability, and the whole stack of entrepreneurial practice is to build a complete, end-to-end product or service system. The benefit is obvious: in addition to being able to better control the end-user experience, it is possible to get rid of the constraints of the original market rulers. By contrast, a full stack of startups appears more ambitious and aggressive. Of course, due to the need to take into account all aspects of the end-to-end, the company must have a horizontal grasp of the knowledge and experience, the challenge is more difficult, the need for a much larger capital. For VC, the risk of investing in such startups will be greater, but the rewards will be higher.

Fortunately, the VC market is getting better. The sign is that VC's own financing (16.018 trillion dollars) in the past few years is well below the 2000 dotcom bubble era of $110 billion. The number of VC institutions is also falling, which means that despite the small amount of financing, but VC's own capital strength is increasing, the market specialization level has become higher, supply and demand are increasingly balanced. This is a good thing for the entire technology business circle.