Marc Andreessen thinks things should cost more. Despite the fact that the US economy is stagnant, with unemployment on the rise and the affordability crisis as bad as it’s ever been, Andreessen has been telling the companies that he invests in to squeeze more out of their customers. Why? Because they can.
“We spend a lot of time working with our companies on pricing,” Andreessen, the cofounder of venture capital giant a16z, said in a recent episode of The A16z Show. “It’s really this magical art and science that a lot of companies don’t take seriously enough.”
That statement would probably confound every business school textbook, which would tell you to consider costs and competitors in the market to determine the optimal price that produces sufficient revenue to operate. But yeah, it’s magic.
“A core principle of pricing is that you don’t want to price by cost if you can avoid it. You want to price by value. Especially when you’re selling to businesses, you want to price as a percentage of the business value you’re creating,” he explained. Of course, that should apply to businesses, but it should under no circumstances apply to employees, who are often significantly underpaid for the value they generate for a company.
The thing is, Andreessen says, it’s actually better for your customers if you charge them more. They like it. “The naive view on pricing is the lower the pricing, the better it is for the customer. The more sophisticated way of looking at it is that higher prices are often good for the customer because the higher price means the vendor can make the product better, faster,” he said. “I’m always urging founders to raise prices, raise prices, raise prices.”
That’s just the kind of advice you get from Andreessen, who said that one of the selling points of doing business with him is that he’s obnoxious and a nightmare to be around. “Generally speaking, the more out there we are, and the more outspoken we are, and the more controversial we are, the better for the business,” Andreessen said on that same episode of the A16z Show.
It’s that approach that has led Andreessen’s company to hire Daniel Penny, the marine who killed Jordan Neely on a New York subway, back a company that is intentionally flooding the internet with AI slop, give money to disgraced WeWork founder Adam Neumann for a new venture, and invest in the likely destined-to-fail “cheating as a service” app Cluely mostly because its founder annoyed people in academia.
It’s unfortunately difficult to suggest that Andreessen’s approach is wrong if your metric for success is money. Earlier this month, Andreessen Horowitz announced that it raised $15 billion in new funding, accounting for nearly one-fifth of the total venture capital spending in the United States in 2025. But hey, where else are you going to get groundbreaking insight like “charge more”? It just hits different when it comes from a guy who lived in a house with seven fireplaces and called the idea of an American middle class an “experiment [that] has been run, and it was a catastrophic failure.”
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