Why Andreessen Horowitz Models Itself After A Hollywood Talent Agency

Following up on last week's 'When Marc Met Mike – Andreessen Interviews Ovitz' article in All Things Digital by Kara Swisher, Michael Ovitz was mentioned in this recent Wall Street Journal Blog entry on Venture Capital Firm Andreessen Horowitz. Read an excerpt below and the full article here.

"...The firm aims to flip the venture industry on its head by acting more like a talent agency - specifically Creative Artists Agency, which became so prominent in Hollywood that it was hard to do deals without them being involved.

CAA co-founder Michael Ovitz, who served on Opsware’s board from 2000 until H-P’s acquisition in 2007, shared his secrets with the two partners, Horowitz said — even talking to Andreessen Horowitz’s employees when the firm started so that everybody could be on the same page.

Horowitz says he and Andreessen looked hard at everything Ovitz did, “and a lot of little things, we copied,” including even how Ovitz ran staff meetings.

Like CAA – and unlike more traditional venture capital firms – Andreessen Horowitz employs over 20 well-paid partners whose job is to help clients, i.e. the entrepreneurs, much in the same way CAA agents serve the talent.

Instead of book and movie and TV deals, the partners, each specialists in their fields, find engineers, designers, and product managers; the best marketing and public relations; and relationships with key customers – not just top management, but the guys who run the network and the database. They check references, and research companies and markets.

“When we were at Netscape, John Doerr introduced us to the CEO of AT&T,” Horowitz said. “That’s great, but he’s not buying a Web server. If you have no relationship at that level, it’s not as powerful, so we invest a lot in that.”

As Ovitz and his co-founders did at CAA, the firm’s three general partners – Andreessen, Horowitz and John O’Farrell, who joined in August from Silver Spring Networks Inc. (and before that, Opsware) to help invest the $650 million second fund raised in November - take a low salary so there’s more money to build the firm. Horowitz wouldn’t say how low, but said the three are compensated on investments."

W Magazine: The Client Whisperer

Michael Ovitz is quoted in the January issue of W Magazine in an article entitled 'The Client Whisperer' about renowned architect Michael Maltzan, who designed Mr. Ovitz's home:

"When architect Michael Maltzan talks about the 28,000-square-foot house he designed for former talent agent ­Michael Ovitz, he draws an instructive distinction between two related archi­tectural forms: “the house” and “the villa.” The former is where peo­ple live, a place of domestic intimacy and private sanctuary. The ­latter ­simultaneously satisfies the owner’s personal needs—bedroom, bathroom, kitchen—while also accommodating larger, public groups. The villa communicates wealth, prestige, and power. It’s a boast; at its best, a memorable one. The ideal today is still defined by Palladio’s 16th-century Italian country houses, structures that both Maltzan and Ovitz know literally inside and out."

Read the full article here.