News Analysis
For three weeks running, Jack Dorsey has relentlessly attacked the VC firm Andreessen Horowitz. Dorsey’s assailed the company’s vision for a new, crypto-powered internet, which it calls Web3. He’s criticized its mission statement (“we invest in software eating the world”), called out its partners, and got himself blocked by its co-founder, Marc Andreessen.
"Dorsey’s barrage may seem out of character” texted one former Twitter employee as he watched the soft-spoken entrepreneur fire away — but those close to him say we ought to get used to it. “Jack was always a slightly restrained volcano,” said one person who knows him well. But in his capacity as Twitter CEO, “he held back.”
“Jack was always a slightly restrained volcano.”
Free from the yoke of Twitter, Dorsey is now unrestrained, and he’s dedicating himself to advancing a vision for crypto — and Bitcoin in particular — that decentralizes power and distributes gains to people, not corporations. “We can’t just see this as an asset we own,” Dorsey said last year. “This is something that has the potential to change everything and make the lives of everyone better.”
To Dorsey, Andreessen Horowitz and its $2.2 billion crypto fund epitomize much of what’s wrong in the crypto movement. By funding companies that enable a new internet built on the blockchain — aka Web3 — Andreessen Horowitz is positioning itself to profit mightily from a system that (if it works) is meant to distribute gains to the users. Funding these companies can also entitle VC firms to tokens they can use to steer governance and take outsized returns, which doesn’t help matters. “You don’t own ‘web3,’“ Dorsey tweeted. “The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.”
The principle of the fight is one thing, but its intensity is rooted in Dorsey’s November 2019 trip to Africa. On the trip, Dorsey saw Bitcoin’s potential to help people circumvent a failing global financial system and became a true believer. Dorsey frequently mentions problems he saw while abroad, including 10-30% transfer fees for sending money between countries, as the kind he’d like to solve.
“A lot of his views were changed when he went on that trip,” said the person who knows Dorsey. “You have countries with a banking system that just never functioned effectively, so you'd have communities that are adopting Bitcoin as a way for them to build their own financial system outside of the ones centrally controlled by the country.”
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Dorsey’s experience in Africa made him a crypto purist of sorts. He’s held firmly onto Bitcoin’s promise since, and the cause has become his life’s driving force. “It's only really rivaled by his beliefs about the detrimental effects of Facebook in business and as a cultural force,” said someone who’s worked closely with Dorsey. “Bitcoin is the most important thing in his life.”
There is some irony in Dorsey’s strong stance against VC firms. He did make a fortune co-creating a social media company that centralized decision-making, though he did try to decentralize it before leaving. He also founded and runs a financial technology company that makes millions from Bitcoin. Bitcoin has also delivered extraordinary wealth to its early adopters. Dorsey did not respond to a DM asking for comment.
For Andreessen Horowitz, the battle with Dorsey doesn’t seem like one the firm wants to let die. After blocking him, Marc Andreessen tweeted a meme portraying Dorsey as a crying woman while a small cat at a dinner table notes that Dorsey invented the block button. Andreessen also started tweeting vigorously from his Twitter account, which he’s largely kept mute in recent years, almost entirely about his joy of blocking people.
For a company obsessed with message discipline, the spat is an odd look for Andreessen Horowitz. But the VC firm has billions of client dollars at stake, the potential to rake in a wealth of governance tokens, and, like Dorsey, doctrinal beliefs about the best way to build on the blockchain. So seeing it go to the mat for its views and money is not entirely surprising.
Ultimately, given how crypto ties belief systems, product dedication, and financial investment together, disputes about it will inevitably get more heated than in other ages of the internet. Dorsey taking on Andreessen Horowitz is just the highest-profile dust-up we’ve seen to date. The meme wars among tech’s most respected names won’t stop here.
