The Justice Department has spent nearly a year investigating whether Andreessen Horowitz violated antitrust law by holding board seats at rival companies, TechCrunch and The Next Web reported.
The inquiry centers on Section 8 of the Clayton Act, a 112-year-old provision barring the same person or firm's representatives from sitting on the boards of competing companies. Cofounder Ben Horowitz sits on the board of Databricks, valued at $190 billion, while partner Martin Casado sits on the board of Fivetran, which merged with dbt Labs in June. The two companies now compete directly after Databricks expanded into AI data pipelines through its Lakeflow product, overlapping with Fivetran's core business, according to TechCrunch.
Databricks and Fivetran were not competitors when Andreessen Horowitz first invested in each, according to investors TechCrunch spoke with, who described the firm's public silence about the investigation as unusual. A Justice Department spokesperson would neither confirm nor deny the inquiry when asked by The Next Web, saying only that the department "will continue to prioritize affordability for all Americans across our economy."
The case tests a law rarely enforced against venture firms, at a moment when VCs increasingly back rival startups in the same category, Anthropic and OpenAI among them, without necessarily holding board seats at both. A board seat carries access to sensitive strategic information that a passive investment does not, which is the distinction investigators appear to be drawing.
For founders, the read is narrower than it looks: this is about board seats, not investment itself. But any founder giving a board seat to a firm that already sits on a rival's board now has a fresh reason to ask how that firm handles the conflict.