Pro Weekly

The Pro Weekly: Andreessen Horowitz Plays a Vital Role in the Creator Economy

Chris Dixon, who leads crypto investments at Andreessen Horowitz. Photo by Getty Images
By
Scott Thurm

Andreessen Horowitz plays an outsize role in the startup ecosystem. But its influence among startups catering to creators is even greater. The firm has been a lead investor in at least one funding round for 23 companies in The Information’s Creator Economy Database. No other firm comes close: The next most common backers of creator startups are Tiger Global Management and Seven Seven Six, with nine each. 

In part, that reflects Andreessen Horowitz’s emphasis on crypto. Chris Dixon, who leads the firm’s crypto team, has raised $7.6 billion to invest in the space and has a staff of roughly 80 to help him, The Information has reported. Andreessen Horowitz’s six crypto investments in the Creator Economy Database include non-fungible token marketplace OpenSea, most recently valued at $13.3 billion in January 2022, and CreatorDAO, a Web3 startup that plans to invest in creators in exchange for a cut of their future earnings. 

The firm’s other creator-focused investments appear to be a mixed bag at the moment. Social audio app Clubhouse was valued at $4 billion in April 2021, but downloads of the app have since declined and the company laid off employees last year. However, live-shopping app Whatnot has raised three additional rounds of funding since Andreessen Horowitz invested in its Series A in March 2021 and was most recently valued at $3.7 billion.

Two Andreessen Horowitz–backed creator startups have been acquired: Spring, which allows creators to customize and sell merchandise, was acquired by Amaze in November; and Nike acquired RTFKT, an NFT platform for virtual sneakers and collectibles, in December 2021.

The Creator Economy Database launched in June 2021 with 50 companies. Today it lists 343. The U.S. startups on the list have raised more than $10 billion. We’ll update those totals early next month, after the end of the first quarter. 

There are many other insights to glean from the database:

  • The database includes 24 unicorns, valued at more than $1 billion, topped by messaging app Discord at $14.7 billion.
  • Seven companies in the database have been acquired, including the two backed by Andreessen Horowitz. Four others have shut down, most recently Catch, a benefits app for freelancers and creators offering health insurance, tax withholding and other services. (We continue to list these in the database and track their fates.) Others are struggling, including Launch House, which recently shut down its accelerator program, and artificial intelligence–based shopping company Nate. 
  • Creator startups are less concentrated in the San Francisco Bay Area than other startups. More of them are based around both New York and Los Angeles, the nation’s media capitals. 
  • Nearly one-fifth of the companies in the database, 67, are based outside the U.S. For all our efforts, we’re sure we’re missing other international companies. If you know of others, let us know. 
  • Through the first two months of 2023, funding of creator startups continued the slowdown that began in late 2021. Investors plowed roughly $135 million into creator startups in January and February, a small fraction of the $890 million invested in the first quarter of 2022. 

Elsewhere on Pro: More Insights From Our Reader Survey

We published the results of our latest reader survey Thursday, showing a dramatic mood shift since our February survey. We hit the headlines here, but March saw a dramatic shift in sentiment about big tech companies. Consider chipmaker Nvidia, one of the few companies for which optimists outnumbered pessimists, 31% to 12%. That margin shrank from February, when optimists outnumbered pessimists 39% to 11%. When it came to companies about which sentiment was already negative, it turned even gloomier. For Salesforce, for example, pessimists outnumbered optimists in February 4-to-1; in March, that ratio was more than 5-to-1. 

What’s Next in The Information Pro

Earlier today, we published our Org Chart of top executives at Binance. Look for another Org Chart in the coming week and a new database focusing on the companies listed in The Information 50 over the past three years.

Speaking of Creators

On April 20, we’re gathering leading creators, investors and founders for our third annual Creator Economy Summit—taking place in person for the first time in Los Angeles. Hosted by Kaya Yurieff and other reporters at The Information, this summit will bring attendees to the forefront of this dynamic industry. This year’s speaker lineup will include longtime creator Hank Green, the D’Amelio family, and executives from TikTok, YouTube and more. Space is very limited—more details here.