A Twitter slap fight goes wrong

Certain VCs who tweet a lot have grown a little vituperative of late, with some of the most powerful people in the industry lashing out in unprecedented ways. The two who spring to mind are Chris Dixon and Marc Andreessen, who’ve lately shown little patience for influential people who question whether the promise of crypto, blockchain-based collectibles, or decentralisation is overblown.

The most prominent battle began in late December with billionaire entrepreneur and Twitter cofounder Jack Dorsey, who tweeted to the six million accounts that follow him, “You don’t own ‘web3.’ The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.” 

Sure, Dorsey was dissing VCs, but there is some truth to the observation, of course. Andreessen and other crypto-forward firms like Paradigm and Pantera do have a financial  stake in some of the biggest platforms out there, and that’s fine. Very possibly those platforms wouldn’t exist without the firms’ support, and very possibly, these platforms will become more decentralized over time.

Nevertheless, Dorsey’s tweet launched a war. Dixon lobbed the first grenade by subtweeting to his nearly 800,000 followers, “[F]irst they ignore you, then they laugh at you, then they fight you, then you win.”

There was some reason for Dixon to gloat. For years, Andreessen Horowitz was thought to be on a fool’s errand because of all of the money and resources it poured into crypto projects. Now, the joke is on everyone who didn’t dedicate a bigger slug of their time and money into those same endeavors. As a reminder, Andreessen Horowitz’s investment in Coinbase alone was valued at $11 billion the day the crypto exchange began trading publicly last year. 

But the war didn’t stop there. Dorsey wrote back to Dixon, Andreessen himself waded into the conversation to insult Dorsey numerous times, and things have continued to roll downhill.

Lately, the miasma has expanded even further. Yesterday, Bobby Goodlatte, a former Facebook employee turned angel investor turned venture capitalist, tweeted to no one in particular, “I’m a huge crypto bull and I think art NFTs are stupid.” Although Goodlatte’s tweet seemed relatively inoffensive on its face, suddenly, Dixon, who has more than 10 times Goodlatte’s 70,000 followers, retweeted Goodlatte’s comment, writing above it, “Can I short Bobby Goodlatte?”

Before a horrified Goodlatte could respond, Dixon blocked his account.

Dixon appears to have since deleted that comment and another insult directed at Goodlatte, whose father is a former Congressman, that read, “My parents are billionaires and I lucked into crypto, but now I’d like to trash hard working founders who worked [their] way up.”

Goodlatte, who seemed genuinely hurt by the whole thing, subsequently called Dixon a clown.

I’ve beat Chris to every good investment he’s ever made so I welcome the short.

Chris was series B at Coinbase, I was series A.

Chris bought ETH in 2015, I bought in 2014.

Dunks, then blocks me. What a clown pic.twitter.com/eY7LSetQ3P

— Bobby Goodlatte (@rsg) February 4, 2022

Many industry observers have been quietly asking what’s going on over at Andreessen Horowitz. Have the partners simply made so much money that, as one VC posited privately earlier today, they are “post giving a fuck?”

Eric Bahn, a general partner with the seed stage fund Hustle Fund, has another theory. “If you look at the content on Facebook that has been shared historically, you know that its algorithms have favored negative stories, attack stories. That’s very shareable fodder. The same is true on Twitter. Some people realize that if you do mean takedowns, it gets noticed.”

Clearly, the firm’s investors aren’t going to say anything. Andreessen Horowitz has been minting money for everyone involved with the firm. Some of those backers — and also certain founders in the market for capital — might even find such brass-knuckled tactics compelling.

Meanwhile, some of its rivals are likely using its pugnacious behavior — one of the only chinks in the firm’s armor these days — to their advantage.

Parker Thompson, a venture capitalist with TNT Ventures, summed up in the aftermath of the Dixon-Goodlatte kerfuffle what many are whispering when he tweeted, “There seems to be something in the water over there that’s making people lose their damn minds. It’s not a bullish sign for the portfolio.”