DOJ’s probe into Andreessen Horowitz over board seats baffles VCs
The Justice Department has launched a probe into Andreessen Horowitz regarding the firm’s partners serving on the boards of competing companies, Bloomberg reported. The nearly year-long investigation focuses specifically on the firm’s board seats at Databricks, which is valued at $190 billion, and Fivetran, which combined with dbt Labs in June.
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Key Facts
- Fact 1: The nearly year-long investigation focuses specifically on the firm’s board seats at Databricks, which is valued at $190 billion, and Fivetran, which combined with dbt Labs in June.
- Fact 2: Databricks and Fivetran are competitors now, but the two companies weren’t rivals when a16z invested in the startups, according to another Databricks investor who spoke on condition of anonymity.
- Fact 3: However, because Databricks and Fivetran have different individuals from the same VC firm on their boards, a16z can institute a so-called Chinese wall between Horowitz and Casado, which would prevent the two partners from sharing confidential information about the two companies with each other, one investor said.
- Fact 4: The investigation invokes Section 8 of the Clayton Act, a 112-year-old law stating that an individual or entity is barred from serving on the boards of competing companies.
The Justice Department has launched a probe into Andreessen Horowitz regarding the firm’s partners serving on the boards of competing companies, Bloomberg reported. The nearly year-long investigation focuses specifically on the firm’s board seats at Databricks, which is valued at $190 billion, and Fivetran, which combined with dbt Labs in June.
The firm’s co-founder, Ben Horowitz, serves on the board of Databricks, while partner Martin Casado serves on the board of Fivetran. Several VCs told TechCrunch they were surprised by news of the probe. Databricks and Fivetran are competitors now, but the two companies weren’t rivals when a16z invested in the startups, according to another Databricks investor who spoke on condition of anonymity.
(Original synthesis pending human/AI review — generated by the stub provider by selecting real sentences from the source material, not by writing new analysis or commentary.)
Original source: TechCrunch
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