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Are We in a Tech Bubble?

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  • Description

    Marc Andreessen of Andreessen Horowtiz weighs in on the state of the technology industry.

  • Duration 6:21
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This transcript is automatically generated

We're pleased -- rejoined by -- legend in the venture capital industry in an icon in the technology industry.

Mark injuries and is joining us now from Anderson Horowitz for happy to have you here today thank you you've got your hands -- so many different cookie cookie -- as I know because you sit on the board says.

Many companies right now you can't talk about them that tell us who you're invested in that we all have heard us.

Sure some of our investments -- at our firm include companies like FaceBook group on Zynga Skype it was a big investment of -- recently -- -- when Microsoft bought.

-- -- -- I think few people have heard that tell us about the Skype deal and why you think it made such a good in needs it's a good deal got.

It was a good deal for both sides of and we felt very good as as investors it is very good transaction for us but we think Microsoft bought a very valuable -- something they're going to be able duel with -- -- -- approximately.

-- -- -- -- -- -- -- You know one thing that people brought up in relation to the Skype deal in in relation to Linkedin going public is this concept of made me.

A bubble that the valuations are just -- -- they don't aren't aren't justified by the underlying revenue streams.

What do you think do you think that weren't as technology bubble sitting -- -- rat in Silicon Valley.

You know -- the last bubble.

You know -- a lot of people and I you know we look we consulate for -- and see if we think prices are out of -- and we don't see evidence the -- and throw -- they're sort of two big reasons for that.

What has a lot of the new private companies people excited about now have very big lenders here's businesses.

That some of them are over billion dollars evidence that it is are these are becoming big important companies and so -- you know we we think they deserve.

You know health evaluations.

-- -- -- thing as the public market most tech companies the public market are trading at rock bottom -- and so if there is a bubble for some reason it is related in the public market that would just be extremely useful.

To companies like Cisco or Microsoft for -- trading -- of ten.

And then simultaneously have -- But it isn't possible for all of them to be home runs from all of them to become the next Google Microsoft -- there's going to be a fall out so -- Do you as an average everyday investor who wants to get involved in the public markets and try and buy your way into these companies.

-- you discern what's -- diamond in the rough.

Vs one assisted.

I think most of that -- what is happening in the -- market so for the most part that the new companies the new interesting companies of pirated Islamist of the new interesting companies for the most part public available today it sort of everyday investors kept most of them.

My hope would be that you know -- firms like for for my investment Michael would be by the time we take the public -- -- to companies.

You know but the vast majority of the great companies they'll lasting yours -- -- public.

Another thing that's been talked about -- a drought that happened and in the DC.

Investing circle that they just weren't great companies and invests in and now.

They're so few great companies in everyone's running into it to jump into and then and that's also driving up the valuations at least in the private market side.

What he had to say about that.

Well I think -- -- your previous question I think every great company is an exception we like to say sometimes that are jobless what we're hunting blacks once.

There that are all the big successful companies borrowers and so there's -- question if you take a thousand startups there's only a few of them that are ever going to be big important companies.

But I think those companies are going to be very big rival ports and so the process we go through -- and -- those ultimately the process the public bathroom here.

Always -- out new idea is from.

From new entrepreneur yours what are the hot new sector's a hot new ideas that are going to become mainstream and ears -- a -- The two biggest ideas right now that the sort of serves more in the big businesses are being built -- -- -- -- -- cloud computing in the -- mobile.

And actually -- because clouds kind of backgammon and mobile -- -- -- one -- future.

The -- got very excited with the -- Smartphones we have the ability to take basically.

Put computers in in in everybody's hands you know across 2345 billion -- -- and -- You know around the world everybody is as -- networks so that that's a very big opportunity like there'll be some great companies built on the back.

What about -- -- difference is happening -- so much of a distinction between what's happening here in the United States verses what's happening in places like China.

What are some of the trends that may be more international verses the ones that are a little bit like the best.

Yes so we think what's happening internationally is very exciting what's happening in China and India and countries like that is very exciting but we're we we generally invest literally invest in those states we're very bullish on the future of the United States were putting the vast majority of our dollars in the US as companies announced -- -- The United States in particular sort of -- is still the best place in the world to build new technology companies are doing -- -- now.

And so is not an accident that you've had companies like Microsoft Google and Cisco and -- built here over the last thirty years.

And we think that -- and to continue.

What about the environment right now for entrepreneurship that there and it there's much that's being made at some of their policies that are being put in by the government things that can be a little bit more friendly.

To Silicon Valley is there anything thank you will see that that they that President Obama and the administration would would listen to you.

And that they're not really hearing right now.

You know I think -- -- we always have a wish list like we always wish that the that there were certain changes for example might -- -- a -- immigration which it was easier to hire smart people and bring them here.

-- them -- companies in the United States.

But generally the US is still very pro entrepreneurial environment generally there's there're fewer barriers here than many other countries generally the culture yours the very pro entrepreneurial -- I -- say that I have -- -- complaints.

Other than maybe immigration.

Yeah right well that's a comment that's a common that complaint that a lot of people in Silicon Valley have to make.

Before like -- -- and ask you for the budding entrepreneurs that are watching right now and and they want they dream of the opportunity began in front if you.

Gives them a sense for what they need to bring to the table and how they need to present it to you in order to get some of your seed money.

You know the describe it as we -- computer science graduates what victories and so we're looking for somebody with -- it we're -- -- -- -- person -- extremely deep technical skills.

The particular computer science computer programming.

Almost always have and we're looking for a bigger something that could change the -- -- to be revolutionary.

That's.

Two very simple concepts a little bit harder to do in reality that's reply as and that's why it is a challenging and exciting field.

Mark and Greece and we're so happy to have you here thanks -- time and thanks for being on Fox Business to him.

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