"An excellent thing for Europe": the arrival of a16z sparks enthusiasm

Wednesday, June 21, 2023

Ten days ago, the world's largest "Web3" fund announced the creation of an office in London, at a time when the SEC is waging a major offensive against crypto in the United States.

There are signs that do not deceive, and the arrival of a16z in Europe is one of them. While the US securities regulator (SEC) launched a series of legal proceedings against Binance and Coinbase at the beginning of June, the world's largest web3 fund has announced in recent days that it is setting up an office in London.

This is a16z's first office abroad since it was founded in 2009.

Once the announcement was made, the British Prime Minister, Rishi Sunak, welcomed the arrival. In a tweet, he hailed the UK's attractiveness and ambition in the crypto world. Since his arrival at 10 Downing Street, Rishi Sunak has in fact never hidden his interest in the subject (read our report).

The choice of London can also be explained by the historical connections between the United States and the United Kingdom. "Most Americans start in London when they arrive in Europe. It's the same language, the same sense of business, it's normal", explains the head of a French web3 fund.

More generally, most European players welcome this arrival. "It's an excellent thing that they're arriving. Europe needs everyone and for once it's in that direction, that it's the Americans coming to Europe and not the other way around, we're not going to sulk in our pleasure," explains Stephen Mackintosh, partner at crypto fund Karatage, which has an office in London.

A16z has already invested in the UK and on the Old Continent, but the opening of an office could enable it to do more. On what volume? When asked, a16z did not wish to respond immediately.

On Twitter, the head of the American group's new London office, Sriram Krishnan, explained that he had received hundreds of messages.

Actually, not all of a16z has moved. "They've set up an office in London, but not transferred their headquarters," quips a French investor. "The real issue is going to be to see what concrete resources they are going to put in. How many people, and above all are they going to invest a lot more?" he adds.

Some people are indeed questioning the opportunism of such a decision: setting up an office in London doesn't cost that much, especially when you're called Mark Andreessen and Ben Horowitz. On the other hand, such a move sends a real signal to the American authorities. "It's a way of putting the pressure on", explains a European investor.

The reaction of several US elected representatives in Congress, who have tabled a bill to remove SEC boss Gary Gensler from office, is the best example of this.

The other possible scenario would also be that things settle down in the US and the environment becomes more favourable again. And in such cases, a16z could possibly refocus on its domestic market, even if many Europeans don't believe in it, or don't want to believe in it.

This analysis is not investment advice. It has been prepared without taking into account your personal situation, particularly your financial situation, risk profile, and investment objectives.

Before investing in any product, investors should fully understand the risks involved and consult their own legal, tax, financial, and accounting advisors.

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