Former U.S. Treasury Secretary Larry Summers is joining Andreessen Horowitz as a part-time special advisor, the Silicon Valley venture capital firm announced this afternoon.
One of the nation’s most respected policymakers, Summer will both advise the firm and work directly with its portfolio companies — from Foursquare to Rockmelt -— as they seek to restructure existing markets and expand globally.
“Companies today tend to want to operate globally, much more so than 10 or 15 years ago in both the developed and developing world,” said firm co-founder Marc Andreessen.”We are fortunate enough to be working with companies that are seeking to transform individual markets here and abroad in telecommunications, advertising, entertainment, real estate and health care. And Larry’s deep insight into global economics and geopolitics will be highly useful.”
Summers was director of the National Economic Council under President Obama, and before that, president of Harvard University and President Clinton’s Treasury Secretary. This is the second high-profile Silicon Valley job Summer has taken on since saying goodbye to Washington D.C. in late 2010. Just last week, Summers announced he’d joined the board of directors at mobile payment company Square, which just today received a $100 million boost.
So why is he doing this, exactly?
For Summers, it’s all about being where the action is. “Anybody who studies the American economy when the history of our times written, technology and what’s going on here right now its going to be the major story,” he said. But Summers isn’t trading in his New England tweed for Silicon Valley hoodies; he’ll stay Boston-based. Though, ” judging by all the emails I’ve been getting from Marc every night before bed, I feel virtually present,” in the Silicon Valley, he said.
Speaking with Summers over the phone this afternoon, I couldn’t help but ask the economist to weigh in on all the bubble talk in social media. Ever the politician, he started by expressing total confidence with his new employer’s “financial prudence” in all investments. As for the industry as a whole, he was a bit non-committal, but erred on the side of “no bubble.”
“Some of the statements that are made conjuring up images of the late 1990s rather misleading,” he said. Most importantly, the scale, intensity and magnitude of Internet connection had changed so much since the days of Pets.com, he said. “I’m surprised when people treat it as an obvious judgment of bubbles in what’s present today,” he said. “But I’ve seen too much to ever preclude possibilities.”
After all, the four most dangerous words in venture capital, he says are: “It’s different this time.”