The “Little Tech Agenda” is Just Self-Serving Nonsense

Dave Karpf / Jul 11, 2024

Last December, the Silicon Valley venture capital firm a16z announced that it would be getting into politics. One of its partners, Ben Horowitz, wrote a blog post on the company website (that’s where they do all the important thought-leadership!) declaring that they would start donating to “techno-optimist” political candidates.

Since then, the company has sunk nearly $50 million into political action committees in the US. Most of this went to Fairshake PAC, which is the biggest political vehicle for the crypto industry this cycle. Fairshake spent $10M against Rep. Katie Porter (D-CA) and $2M against Rep. Jamaal Bowman (D-NY) in their primaries. (I guess by “techno-optimism,” what they meant was “number go up!”)

A new catchphrase: “Little Tech”

Over the weekend, a16z published an update to their political agenda. They’re no longer spending money simply to support techno-optimism. Now they’re spending money to support “The Little Tech Agenda.”

And what is little tech? Well they are so glad you asked! Little tech is STARTUPS.

“...the vanguard of American technology supremacy has always been the startup. From Edison and Ford to Hughes and Lockheed to SpaceX and Tesla, the path to greatness starts in a garage.

"A startup is what happens when a plucky group of outcasts and misfits comes together with a dream, ambition, courage, and a particular set of skills – to build something new in the world, to build a product that will improve peoples’ lives, and to build a company that may go on to create many more new things in the future.”

According to this view, startups are everything good and wholesome in the American economy. They are courageous risk-takers with “a clean sheet of paper – a single shot to imagine and realize a different and better world.”

But startups are imperiled like never before. Big, mean government regulators are getting in their way, asking questions like “does your product actually work as advertised?” and “is this a ponzi scheme?” and “are you in violation of multiple laws?” and “no really this is obviously a ponzi scheme. You know those are illegal, right?”

What’s worse is that the government is biased in favor of incumbent companies. You know… big companies, with proven track records and products that are more substantial than a “clean sheet of paper.” Also, the government is taking a hard look before letting those big incumbent companies acquire startups. (Which they should obviously do, because when startups get swallowed by Facebook/Google/Amazon/Microsoft, that’s good for the Little Tech Agenda.) Oh, and the government is talking about taxing unrealized capital gains, which would be bad for venture capital and is, thus, anathema to plucky groups of outcasts and misfits coming together to build things.

The result, they insist, is “stagnation and decline in the American economy today.” As evidence, they note that fifty years of the digital revolution has not resulted in any real gains in productivity growth. You might wonder why decades of low productivity growth and soaring VC wealth have only become a problem once the VCs start worrying about their investment portfolio. Please do not wonder about such things. Andreessen has no explanation, and likely would much rather you didn’t.

In case you can’t tell, all this verbiage is just window dressing. Whether you call it “techno-optimism” or “Little Tech,” it appears that Andreessen Horowitz’s political spending has a very simple logic to it.

A16z is an investment portfolio. Its partners are just financial managers. They convince rich people to give them money, and they invest that money in early stage companies. Then they push those companies to maximize their return, and use their connections to help grease the wheels.

They spend money to promote the interests of their investment portfolio. They are invested in a lot of crypto schemes, so they think the government should let the crypto industry self-regulate. They are invested in a bunch of AI startups, so they think the government should take a hands-off approach to AI. They aren’t actual libertarians, because they also want the government to use these portfolio companies as vendors (government contracts built Silicon Valley. Government contracts sustained Silicon Valley after the dotcom crash. Government money is as sweet as it is reliable). They are only opposed to Big Tech when Big Tech is directly competing with their portfolio of startups. They are happy to have Big Tech buy out those same startups, because that’s a liquidity event. And of course they oppose any efforts to tax VC bucks. If VCs can’t dodge the taxman, then what even is the point?

The myth of the genius entrepreneur

This is nothing new. Since the 1990s, Silicon Valley has been deeply invested in the myth of the genius engineer/entrepreneur in a (fake) garage, and has gone to absurd lengths to pretend that government could only ever be an impediment to innovation, even when government funding and regulatory clarity was directly driving those same industries.

What has changed is the scale of the money involved, and the sheer audacity of the top VCs. VCs also donated to candidates in the ‘90s, ‘00s, and ‘10s. In those decades they also nudged them to favor their businesses and investments over incumbent rivals. But they didn’t have quite so large a share of the global economy back then. Policymakers kept reducing their tax burden and shredding the regulatory state, and they kept getting richer. Now here we are.

This, by the way, is the main reason why so much of Silicon Valley has decided to embrace the candidacy of former President Donald Trump. It isn’t that tech leaders necessarily love incompetent authoritarians. It isn’t because they believe any of his promises. It’s that they have spent 3.5 years facing Lina Khan at the Federal Trade Commission (FTC), and they cannot handle answering to a competent regulator anymore.

The FTC published a spicy memo last month, warning AI companies not to misrepresent what their services are or can do.

“Your therapy bots aren’t licensed psychologists, your AI girlfriends are neither girls nor friends, your griefbots have no soul, and your AI copilots are not gods. We’ve warned companies about making false or unsubstantiated claims about AI or algorithms. And we’ve followed up with actions, including recent cases against WealthPress, DK Automation, Automaters AI, and CRI Genetics. We’ve also repeatedly advised companies – with reference to past cases – not to use automated tools to mislead people about what they’re seeing, hearing, or reading.”

This is what the “Little Tech Agenda” is fighting against. They are opposed to having an FTC that prevents outright fraud. But if the government actually protects consumers, a16z’s investment portfolio may take a big hit. This is why many VCs would much prefer autocracy to accountability.

Andreessen and Horowitz could have saved its money if its partners had known that the Supreme Court was going to overturn Chevron deference. Six Republicans with lifetime appointments have decided to imperil the regulatory state. It’s in their benefactors’ personal financial interest.

But when you have as much money and power as these guys do, I suppose it’s just fun to splash around a bit. I’m sure before 2026 they’ll write another blog post, debuting yet another term for their political spending once this one fails to stick.

The “Little Tech Agenda” has nothing to do with innovation or technology. It’s just a VC wish list. The investor class isn’t clever enough to invest in companies that turn a profit by bringing useful products to market anymore. They need special treatment from the government for their bad investments to pay off. And they’re more than willing to spend in order to get it.


Dave Karpf
Dave Karpf is an associate professor in the George Washington University School of Media & Public Affairs. He teaches and conducts research on digital politics. He is the author of The MoveOn Effect (2012) and Analytic Activism (2016), and is currently working on a book about why Silicon Valley's pr...