Jen Kha on $43B raised for a16z, sovereign wealth demand, and why the megafund model works

today uh and whether or not America is back. Welcome to the stream, Jen. How are you doing, Jen? G. Good to see you all. There was a world where we didn't talk and I just hit the size column button over and over and over and over and over and it's just a 10-minute segment of just us. Yeah.

Why don't you kick us off with how much money you've raised for Andre so we can just get Jordy an easy layup here. All right, let's do it. By the way, for the audience, I told Jordy ahead of time, my sole intention is to have all the sound effects pop off the entire time I'm talking here.

Let's get the National Ball sound effect. Yeah, there we go. Welcome to the stream, Chad. Welcome to the stream. Let's go.

By the way, by the way, as Katie said a few uh weeks ago, first time caller, longtime listener, but before we get into the content, I have to say I have to do just a quick plug for your true early fans. You know, I know you had to do the gift guide for the Super Bowl of Pronatalism, right? You had to cover tariffs.

You had to cover drug pricing. There's a lot happening. But before we get to the real topics, it's been a while since you've talked about them on property rankings. Yes, it has. It has. We need to bring that back. Why don't you come on with us?

Do why don't we do why don't you join us for the for the updated power ranking of the bond properties. This is what really this is the news that moves Silicon Valley for sure. Yeah. Yeah. We can get kind of like a goat debate going. Yeah.

Anyway, by the way, I've got so I've raised over 43 billion in capital over the course of my career. Most of that was at congratulations. Uh but I I spend all my time across all the funds. across crypto summers, tech winters, everything in between.

Uh I'm the professional yapper to the capital behind the capital, so the LPs. Uh so that's where I spend all my time. Uh what's it like having everybody or not everybody, but but many people under the same roof. I'm surprised you have even 10 minutes to get away today.

You probably one of the more popular people in the room. Well, it's definitely the quiet before the storm right now. So things are kicking off here shortly, but it's uh it's awesome. Uh it is um there's a lot obviously happening in the world today and also uh our LPs are are busy people.

Last week was Milkin, this week was the Saudi conference. Uh there's a lot on everyone's minds. We could talk about what's happening with the endowments. Um and you know people are are looking for some optimism. We're probably the bright spot in their portfolio right now.

Uh and so as a part of that, it's exciting to gather everyone here.

Yeah, there's a lot of like hot take and micro themes around, oh, if there's a if if Harvard goes forprofit or something, that's going to flood a huge amount of endowment money out of venture capital or Yale's going to sell their stakes or something like that.

But can you talk about some of the more macro themes if we zoom out the last 10 years or more? How have trends changed in the LP base of venture capital more broadly? Yeah. Well, the asset class has definitely gotten obviously a lot more sophisticated, right?

It used to be a small cottage industry and the asset class has just grown alongside of course the outcomes and so as a result of that you know the sophistication level of not only the venture capitalist but also the expansion of LPs have commensurately changed as a part of that.

So you just don't have endowments or foundations or family offices investing that's expanded to sovereigns now who have a different type of opportunity cost of capital and then you have big pensions now actively uh playing the game as well.

So Kalpers, for example, very famously missed out on the last 1015 years of returns and now they're making up for for lost time as a part of that.

And so traditional pools that didn't used to invest into the asset class are now wanting a seat at the table largely again because increasingly the percentage of GD GDP that's being taken over by tech has just exploded.

I heard you mention to to Eric, you know, Nvidia is about to be uh this monster of a company just jumped up.

that about to be it's only a 60 it's only $60 billion gap between I checked this morning so get this so so Nvidia Apple and Microsoft independently are bigger than the entire stock market of most of the G7 countries so Germany UK uh France like it is wild it's it's actually bigger companies are bigger than all the G7 countries except obviously for the US and Japan yeah I mean speaking of the international stuff a month ago people were buying French bombs It was a mistake.

It's good to see. Um, yeah. What is kind of the trade imbalance, the trade flow in terms of venture capital? I imagine there's a lot of money flowing internationally into American uh venture capital firms, but VC funds also invest in uh invest abroad and and uh internationally.

Uh is there is there a trade imbalance there? Is there more money flowing into America than flowing out or is it kind of 50/50? Like how has that evolved? Yeah, so our I will only speak for A16Z. So, um, A16Z is still 90% plus in North America.

Um, that being said, you know, our portfolio companies though spend a lot of time abroad and focus on a lot of distribution as a part of that.

So, I heard your your Saudi correspondent yesterday mention that folks in the uh the defense in Saudi, you know, all of a sudden are like, we want Ander, we want Seronic, we want all these early stage technologies and and guess what? Every country wants to modernize their government.

They want Silicon Valley tech on speed dial. And so there's a massive interest in all areas, especially in our American Dynamism practice for new technologies and they want to replplatform to the new AI age.

And so we actually um at A16Z have brought over almost close to 300 plus companies uh around the world um spending a lot of time in in Saudi and also the broader GCC and particularly um yeah, it's funny. I was watching the uh the Qatari uh motorcade welcome Trump earlier today.

like they went so hard on on it, but it's it's that kind of classic thing. We're there to go to the best technology. Yeah. First and for foremost and so as a part of that that is the leading driver of wherever uh trade actually ultimately goes to.

What is the takeaway from Saudi Arabia and what's going on with KSA and NBS? Um how are you thinking about Saudi Arabia more broadly these days? Yeah. So, we we spent a lot of time there um largely again to help our portfolio companies with with the expansion and and you know, NBS is pretty phenomenal.

Everyone's talking yesterday a lot about Trump and and how the vibe has shifted, right? The America's so back, right? And uh I feel like that deserved a gong like it is I was caught sleeping. I was sleeping at the wheel. I'm going to be on top of it. I got I got more here.

I'll I'll stay I'll I'll keep the soundboard up and just keep going. good. Uh but but NBS is like an amazing leader, right?

Everyone's talking about Trump, but but I think the the the other part of this is like in the eight years since Trump's first visit, NBS was basically able to get every tech leader in the world at that conference, right? He's absolutely crushed. And and the whole country, by the way, his people love him.

They all have, if you go to to the country and you see people's cell phones, they have NBS's photo as their their background on their phone. And then if you WhatsApp with people, their profile picture is MBS, which makes it obviously very confusing.

But you know, when was the last time a world leader was as beloved as he has been? And and that's largely again because he's very conscious of the fact that the future needs to be tech first. He's got 70% of the population under 35. And that population is watching Netflix and YouTube.

And so he's very conscious of the fact that he needs to modernize his country as a part of that. He's retooling all the capital away from oil into tech as a part of that. Very cool. Well, last question then we got to move on. Yeah. What what what are people getting uh you are one of the co-creators of a mega fund.

What do people get wrong about the the in in the sort of megapun debate?

Because oftent times the people that are debating have sub nine figures of aum and uh you know I just think it's like unless you're playing unless you're in the arena scare me the big ones scare them but um but yeah what what what are people getting wrong about the the megapund debate today?

Yeah, it's it's a totally different game and obviously again I'll only speak for ourselves. uh yeah what we're playing is is very different than you know obviously seed funds and small emerging managers are playing.

So it's very very uh difficult to paint the broad paintbrush across um every type of venture capital firm but you know I think the the premise of it still holds true.

So so I heard Eric mention this earlier you know Mark pioneered the term software is eating the world and the reality is software didn't just eat it door dashed it. It devoured it. ask for seconds, right?

And so everyone's obviously uh now playing catch-up as a part of it relative to this massive opportunity, but also more importantly, firms haven't scaled. Most VC firms haven't scaled to reflect that. And so from a capital standpoint, not only have we scaled the capital, but we've also scaled the firm as a part of it.

So if you look at every single team at A16Z, it's actually no bigger than the original incarnation of A16Z. So the deal teams are actually pretty small. They're no bigger than four to six people.

So, every vertical that you'll talk to today has a deal team focus that is much more oriented around not only that vertical, but also making sure that the fidelity of conversation that you have is super high because otherwise as you've scaled the firm, if you have too many people around a table, it ends up being like a presentation, right?

And so, totally when we think about the firm, that's the big part that we focus on.

like have we actually not only made sure we've scaled the capital to reflect the market opportunity, but also have we also scaled the firm to reflect how we actually want to run the organization and and making sure we're actually covering each vertical with that domain level expertise. That's amazing. Thank you so much.

I I mean I my my contribution to the mega fund debate is if you ask a series C or D founder, hey, are you happy that there's, you know, potentially hundreds of millions or billions of dollars available to you to raise in the private markets, are they going to be like, no, I'd rather do a small cap IPO and and, you know, be, you know, spend years dragging it out in the in the public markets before my in every statement.

I think that that should end the debate by itself. So, um, Jen, it's fantastic having you on. Uh, the crowd loved it, too. The crowd got us. Come back. Come back on again soon. This was great. We'll do the We'll do the Aman power ranking together. Can't wait. Catch you later. Bye. Have a great event.

Yeah, it's uh it's funny. Uh underrated narrative is that they are this mega fund, but I was looking at who invested in Josh Browder's new fund, $30 million. It's like four Andre partners, right? It's like Mar Chris like all the guys. And he raised money from Andre for do not pay as well.

So there's been this like really such Josh's A16Z round I think it was a series A wasn't it like 4% dilution round. Yeah it was really low fascinating but they clearly like working with him because they backed him on the fund. Yeah. And he's taken such a contrarian approach to building the company.

Seven full-time employees. Yep. Dividends. He was like the first company to be like I'm profitable. You remember