The U.S. Department of Justice is investigating Andreessen Horowitz, or a16z, over whether partners at the firm improperly hold board seats at two competing AI data companies, Bloomberg reported. The companies at the center of the probe are Databricks Inc. and Fivetran Inc., both backed by Andreessen Horowitz.
People familiar with the matter said a16z co-founder Ben Horowitz sits on the board of Databricks, while partner Martin Casado serves on the board of Fivetran. The DOJ is examining whether those roles amount to an improper overlap involving competitors. The people asked not to be identified because the matter is not public.
The probe focuses on overlapping governance at two AI data companies
Databricks and Fivetran operate in closely related areas of enterprise data collection, organization, and analysis, according to the report. What looks like a dispute over board seats also reaches into a broader venture capital practice: placing representatives across multiple portfolio companies in the same sector.
Casado also previously served on the board of dbt Labs, a similar company that Fivetran acquired in June. People familiar with the matter said the DOJ spent months reviewing that transaction, which was announced in October last year, before approving it without conditions.
Those people said the a16z inquiry has been running for nearly a year and began at roughly the same time as the merger review. The investigation continued even after the acquisition closed.
A spokesperson for Databricks and a spokesperson for the DOJ declined to comment. Spokespeople for Andreessen Horowitz and Fivetran did not respond to requests for comment.
A rarely used 1914 law is at the center of the case
The investigation follows a Biden-era enforcement focus on a little-used 1914 statute targeting “interlocking directorates,” the practice of having the same person or entity represented on the boards of two direct competitors.
Under former Assistant Attorney General Jonathan Kanter, the DOJ repeatedly pushed for directors to step down to remove that risk. The report cited a 2021 example in which Endeavor Group Holdings CEO Ari Emanuel left the Live Nation board. Between 2022 and 2023, directors at more than a dozen other companies also resigned. In cases like these, the standard remedy is often for a director to leave one of the competing boards.
This case has a wrinkle. The overlap at issue does not involve one individual sitting on both boards. Instead, it involves different partners from the same venture firm serving on the boards of competing companies. Bloomberg said the law applies to both individuals and corporations, and some courts have accepted that reading. Even so, that point could form part of a16z’s defense if the government moves ahead.
Washington ties add to the attention on the case
The matter is drawing added scrutiny because Andreessen Horowitz has close ties to the second Trump administration, according to the report. The firm has established contact with the White House, and parts of its technology portfolio could benefit from looser regulation. Members of the a16z team have also been active in Washington pushing related policy measures.
Bloomberg reported that in 2024, Ben Horowitz and co-founder Marc Andreessen each donated millions of dollars to groups supporting then-presidential candidate Donald Trump. The firm has also been an influential voice in AI policy and helped push for the rollback of several AI safety controls under the current administration. In the second half of 2024, Ben Horowitz also donated $2.5 million to a super PAC supporting Democratic presidential candidate Kamala Harris.
People familiar with the matter said the DOJ has not decided what to do next and may ultimately close the case without taking action.
A $90 billion venture firm with deep AI exposure
As of January, Andreessen Horowitz managed $90 billion in assets, making it one of the world’s most heavily capitalized venture firms. It recently raised a $15 billion fund, described in the report as the largest single fundraising round on record, with capital earmarked for startups across sectors.
In AI, the firm has invested billions of dollars in startups including Cursor, the coding startup recently acquired by SpaceX, and voice AI company ElevenLabs. The report also said Andreessen Horowitz is a major investor in SpaceX, which completed its listing in June, and has also positioned itself around OpenAI, which is planning to launch an IPO in the near term.
Databricks is also one of the firm’s portfolio companies seen as a potential listing candidate. Ben Horowitz has led investments in the company since a $14 million funding round in 2013. Last week, Databricks said it raised $5 billion in a new round that valued the company at $190 billion.