Marc Andreessen Is Bullish on the Economy
Technology Editor, CNBC.com
NEW YORK — Tech guru Marc Andreessen says he's bullish on the U.S. economy.
"I'm quite bullish," he told CNBC's Julia Boorstin on Tuesday before appearing at the Wired Business conference. "We're coming up on year 15 of a flat stock market. Historically that's a pretty good sign. So I'm not a hedge-fund manager but if I was I think I'd be feeling pretty good."
At the conference in New York, Andreessen, founder and general partner of Andreessen Horowitz, said he didn't think the tech sector was in a bubble.
"I don't think objectively we are in a tech bubble when tech stocks are at a 30 year low," he said.
While Andreessen, who is an investor and on the board of Facebook, couldn't comment on the valuation process of Facebook's $1 billion purchase of Instagram, he did comment on how some companies do the math when purchasing a smaller technology company.
Larger companies, like a Google or Microsoft , determine a price for a smaller company based on its "strategic value," Andreessen said.
It's not what the company is making, it's what the larger company can do with the smaller company, Andreessen said. Companies often buy the "insurgent" or the enemy, so that they can manage their risk, he said.
For venture capitalists like Andreessen, however, the process of finding a company to invest in is quite different.
When looking for the next big thing, Andreessen said that his firm tries not to make to many assumptions.
"The main thing we try to do is not to have a thesis," he said. "We try to be just as optimistic as possible."
Currently, the Andreessen Horowitz firm has $2.7 billion under management across three funds and portfolio holdings that include Box, Facebook, Pinterest, Twitter, Tidemark, and Zynga. ,
Still though, there are some theories or technology advances that Andreessen said are still underrated, one being the smartphone.
There is more computing power in the world today than throughout history and the potential for that is huge, he said.
"The smartphone revolution is under-hyped, more people have access to phones than access to running water," he said. "We've never had anything like this before since the beginning of the planet."