Bloomberg: How did a16z become a key force behind U.S. AI policy?

CN
6 hours ago
Original Title: "Andreessen Horowitz’s Rising Influence Over Trump-Era AI Policy"
Original Author: Emily Birnbaum, Oma Seddiq, Bloomberg
Original Translation: Saoirse, Foresight News

One of Silicon Valley's most prestigious venture capital firms has become a behind-the-scenes force in shaping Washington's artificial intelligence policy. With Donald Trump expressing support for the industry's full acceleration in this emerging technology field, the company's influence has become increasingly critical.

According to current and former White House and Congressional aides, senior White House officials and senior Republican aides in Congress typically turn to a16z as their first external call when considering actions that may affect technology companies' AI plans.

Their main point of contact is the company's chief lobbyist in the capital, Collin McCune. A former White House official stated that this company, referred to as a16z, virtually holds veto power over all AI-related proposals.

“They are an absolutely powerful lobbying force, possibly the most powerful single entity I’ve seen in recent years,” said Doug Calidas, chief lobbyist at Americans for Responsible Innovation, an organization opposing a16z's attempts to weaken state laws regarding AI.

The company's rise in Washington has been bolstered by significant influence investments, co-founder Marc Andreessen's close relationship with Trump, and a network of partners who once worked at the company and now hold key posts in the government. Simultaneously, it has skillfully packaged its portfolio of invested startups as exemplars of free-market innovation celebrated by a Republican-dominated Washington.

a16z's bold and aggressive approach, coupled with its enthusiasm for deregulation, reinforces the government's view that most regulatory constraints on AI could jeopardize the United States' competitiveness in this rapidly evolving technological sector, which is a crucial driver of recent U.S. economic growth. The company is also a key player in the Trump administration's efforts to block states from implementing AI regulatory measures.

Marc Andreessen and his wife, well-known American philanthropist Laura Arrillaga-Andreessen, photographed in April. Photographer: Craig T Fruchtman/Getty Images

White House spokesperson Kush Desai stated in a statement that Trump and his advisors “have always been willing to listen to business and tech leaders,” but that “the only special interest guiding this administration’s decisions is the best interest of the American people; only President Trump has veto power over government policy.”

Collin McCune also stated in the release that Trump is “the sole architect of AI policy for this administration.”

As of January, a16z managed assets reached $90 billion, making it the largest venture capital firm by asset size in Silicon Valley (note: this refers to pure VC operations). The firm recently completed the largest funding round in history, raising $15 billion and investing billions into emerging AI companies like Cursor and LM Arena. These companies, along with a16z’s stakes in large tech firms like OpenAI and Meta, will benefit from the loosening regulatory policies it promotes in Washington.

The company's unyielding stance has made compromises on AI-related legislation more difficult and sometimes disappointed lobbyists from large tech companies who are also allies in Washington policy. According to insiders, although tech giants like Microsoft and Amazon have indicated a willingness to compromise on federal AI standards, a16z has outright rejected proposals that would impose significant new regulations on AI development.

a16z's chief legal and policy officer Jai Ramaswamy stated, “The end result is that large companies start making trade-offs.” Large enterprises can deploy attorney and compliance budgets, while “small companies founded by a few people in a garage can’t make those compromises at all.”

Many artificial intelligence skeptics believe that the technology could harm users, replicate real-world biases against vulnerable groups, and replace jobs across various industries, and thus should be subject to regulation. Some AI developers even argue that, if left unchecked, AI could lead to the apocalypse.

In December of last year, there were attempts to use a must-pass defense bill to prevent states from enacting AI safety-related laws, which was a typical demonstration of a16z's influence. Just months prior, allies in the tech industry within Congress had tried to add similar provisions to Trump's signature tax legislation but were blocked by Republican governors, MAGA-aligned celebrities, and a coalition of child safety organizations.

According to a senior Republican aide, when weighing actions related to the defense bill, Collin McCune was the first external person called by the government. Collin McCune offered clear support and immediately acted to coordinate with White House AI head David Sacks, House Majority Leader Steve Scalise, and Senate Commerce Committee Chair Ted Cruz.

This legislative maneuver did not succeed, but Trump subsequently used presidential powers to achieve the same goal: signing an executive order to prevent states from implementing regulations designed to mitigate AI-related harms. According to a person close to the White House, a16z also assisted in drafting the content of this directive. The executive order echoed a novel claim pushed by a16z: that under the Constitution's "Dormant Commerce Clause," states have no authority to regulate the national AI market.

In December of last year, Trump signed an executive order limiting states' powers to regulate AI, which has long been a goal of the tech industry's lobbying efforts. Photographer: Alex Wong/Getty Images

The company’s hardline co-founder, Marc Andreessen, sits at the apex of its influence operations. At 54, he is one of the founders of Netscape, which helped usher in the internet era. He co-founded a16z with Ben Horowitz shortly after the 2008 financial crisis. Standing nearly two meters tall, he has a bold personality and once joked to Fortune that his motto could be "make mistakes often, never doubt."

Marc Andreessen was a bipartisan campaign donor and contributed to Barack Obama’s first presidential campaign but completely shifted his stance because of the Biden administration's push for stricter regulations on tech companies—especially measures limiting cryptocurrency and tech firm mergers. He has since become a Republican mega-donor and positioned himself as a “tech right” thought leader.

In 2024, after donating $2.5 million to Trump’s campaign team, Marc Andreessen has met with the president multiple times at Mar-a-Lago. According to someone close to the White House, he often discusses technology policy with Trump over the phone and keeps in touch with White House Chief of Staff Susie Wiles.

He also deliberately cultivates relationships in Congress. In 2024, Marc Andreessen attended a Republican donor event hosted by House Speaker Mike Johnson in Jackson Hole, Wyoming, and served as a keynote speaker. Since then, he has frequently visited Washington, known for hosting private dinners with members of Congress in popular restaurants. In casual conversations, he enjoys discussing philosophy, is happy to host but does not directly propose specific policy requests.

According to an insider, during a two-hour dinner last year with Republican Senators Eric Schmitt and Mike Lee, he spent most of the time discussing AI-related books and podcasts he was interested in.

The firm registered its lobbying business for the first time in 2023, initially focusing on cryptocurrency legislation and defense procurement, both areas where it has a significant technology portfolio.

Traditional VC firms usually only assess the political risks of investments, while a16z is "proactively seeking ways to address risks before they disrupt investments," said Adam Thierer, a senior fellow at the center-right R Street Institute.

Marc Andreessen expressed no remorse about this. “In principle, every venture capital firm and every tech company should be involved in these matters. But the reality is that the vast majority are not,” he said in a January episode of the a16z podcast. He and Ben Horowitz “basically determined that the stakes are just too high here. If we’re going to be industry leaders, we must take responsibility for our fate.”

a16z is also willing to bear the costs. According to publicly disclosed information, the firm's federal lobbying expenditures are projected to skyrocket to $3.53 million in 2025, double that of 2024, far exceeding other venture capital firms like Sequoia Capital and Bessemer Venture Partners.

The company also helped establish a new lobbying organization called American Innovators Network, spending over $350,000 in New York alone to oppose AI safety legislation while targeting similar bills advancing in other states nationwide.

To create a more favorable Congressional environment for its agenda, Marc Andreessen and Ben Horowitz jointly invested $50 million into a super PAC called Leading the Future, which has a total size of $100 million, to support pro-industry allies and oppose AI regulation advocates. The organization attempts to replicate the successful model of a16z-supported cryptocurrency PAC Fairshake, which invested millions in the 2024 Congressional elections and successfully influenced electoral outcomes.

“Everyone I talk to is very clear that there is a $100 million ‘dragon’ here, ready to breathe fire and pressure them at any moment,” said Sunny Gandhi, vice president of political affairs at the AI safety organization Encode.

The company has numerous other connections in Washington. According to insiders, David Sacks often meets with a16z’s government affairs team. White House AI senior policy advisor Sriram Krishnan was a partner at a16z before joining the government. The close relationship between the company, David Sacks, and Sriram Krishnan has conversely made Congressional aides more willing to engage with the a16z lobbying team.

a16z's office building in San Francisco, California. Photographer: Smith Collection/Getty Images

However, the leadership of this venture capital firm is determined to create influence that transcends Trump's term and hedge against a possible Democratic comeback. According to an attendee, last spring, Marc Andreessen and a16z partner Chris Dixon accepted an invitation from moderate Democrats to host a policy meeting focusing on AI and cryptocurrency, attended by several Democratic lawmakers from the House.

Marc Andreessen and Ben Horowitz have packaged their calls for relaxed regulation into a “small tech agenda,” trying to position the venture capital firm as a defender of vulnerable startups. This manifesto was initially released in 2024 when public dissatisfaction with big tech companies was high. a16z’s chief lobbyist Collin McCune has also used this terminology, stating that his guiding principle is “to protect small tech entrepreneurs and allow them to thrive.”

Critics scoff at this. “They believe that anyone who wants to provide some protection for Americans is an idiot,” said New York State Assembly member Alex Bores, who has become a target of a16z for initiating AI safety legislation in his state.

The company holds stakes in several large enterprises, including SpaceX, xAI, Airbnb, and Anduril Industries, with these early investments now skyrocketing in value. According to PitchBook, a16z has invested in 10 of the 15 highest-valued VC-backed private companies globally. Its core business is betting on those new firms expected to become the next tech giants—this model relies on the ability to protect the rapid expansion of startups. Another important way a16z profits is through large tech companies acquiring its invested startups.

Critics argue that the company's holdings in these large tech companies render its defense of "small tech" hollow. A16z has not lobbied in support of using antitrust laws to constrain the power of the largest tech companies.

Currently, a16z's position on AI policy often aligns with that of the biggest tech companies. When New York State Assembly member Alex Bores was about to pass his AI safety bill, he requested that a16z's policy team provide suggestions on how to define small, medium, and large AI developers. Alex Bores initially agreed that the most stringent provisions of the bill should only apply to the largest companies to protect startups.

a16z proposed that “small” developers should be defined as companies with annual revenues not exceeding $50 billion from AI products.

“That basically excludes every company on the planet,” Alex Bores stated in an interview. Ultimately, after strong lobbying from a16z and other tech companies, the version of the bill signed by New York State Democratic Governor Kathy Hochul was significantly weakened.

Now, the firm is setting its sights on the next step: assisting in the development of federal AI standards, which are expected to replace state AI laws even after Trump's term ends. A16z released a federal AI legislative roadmap in mid-December calling for the inclusion of provisions like “model transparency,” requiring AI developers to disclose certain details about their models, such as intended uses and protections for children using AI. Besides, a16z's proposals focus on punishing “bad actors” abusing AI rather than regulating the developers themselves.

Doug Calidas from the AI safety organization Americans for Responsible Innovation countered that a16z's macro proposals are merely “small steps,” lacking in plans to mitigate AI threats. He added that the proposed transparency provisions only require developers to disclose “the most basic” information about their products.

According to two Congressional aides involved in the preparations, key Congressional Republicans have adopted a16z's proposals as a starting point for legislation. However, federal AI legislation is evolving into a significant contest involving numerous stakeholders, including safety organizations advocating for holding AI developers accountable for damage their products cause.

“How much influence we can exert will be a tough battle,” said Sunny Gandhi from the Encode organization, “but they cannot just force things through.”

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