Andreessen Horowitz, the venture-capital firm that has backed technology startups including Facebook, Groupon, Zynga and Skype, announced plans today to donate half of the profits made from investments.
The firm, co-founded by Web pioneer Marc Andreessen, will give the money to charities selected by its six general partners. It will donate half of its carried interest, or its portion of profits after funds have been returned to limited partners, as well as half of the salaries of Andreessen and other general partners, it said in a blog post.
“We really believe that we are great beneficiaries of the society in which we live,” Ben Horowitz, a co-founder of the firm, said in a telephone interview. “We think it’s important in order to keep the world going that we acknowledge that and keep giving back what we should be giving back. We don’t want it to be about playing polo and having vineyards and private jets.”
Started in 2009 by the two veterans of Netscape Communications Corp., Andreessen Horowitz has raised a total of $2.7 billion. The firm has returned investors $288 million, almost all of the $300 million it raised three years ago for its first fund, Horowitz said.
Andreessen Horowitz is starting the charity program by giving a total of $1 million to six nonprofits located near its Menlo Park, California offices, including Via Services, Fresh Lifelines for Youth, Second Harvest Food Bank and Canopy.
“We want the first gift to be local, as an expression of thanks to the community,” said Horowitz. He said the charity total could some day be “in the billions.”
The idea to donate half of venture capital profits was partly inspired by John Doerr, partner at Kleiner Perkins Caufield & Byers, and Michael Moritz, venture capitalist at Sequoia Capital, who each pledged half of their personal income to charity, Horowitz said.
Andreessen’s firm benefited from Facebook’s decision earlier this month to pay about $1 billion to buy Instagram, the photo-sharing service supported early on with a $250,000 injection from Andreessen Horowitz. That investment will be worth about $78 million after the acquisition closes, Horowitz said earlier this week in a blog post.
Bloomberg LP, parent of Bloomberg News, is an investor in Andreessen Horowitz.