Andreessen Horowitz, the country’s largest venture capital firm, announced this week that it is moving its state of incorporation from Delaware to Nevada. The firm also encouraged other venture capitalists to follow suit. In a detailed post explaining the decision, Andreessen Horowitz criticized Delaware’s Court of Chancery.
The firm stated that the court has “injected an unprecedented level of subjectivity into judicial decisions, undermining the court’s reputation for unbiased expertise.”
The post noted that Nevada codifies business judgment rules in statute, “making it more predictable and less subject to court reinterpretation.” Nevada also restricts shareholders with less than 15% ownership from inspecting records, “reducing legal fishing expeditions.”
Andreessen Horowitz highlighted two recent legislative measures in Nevada aimed at upgrading its business courts. Assembly Joint Resolution 8 proposes creating a specialized business court with judges appointed by the governor. Assembly Bill 239 allows jury trials in civil cases to be waived.
Both bills were sponsored by first-term Assemblymember Joe Dalia, a Democrat from Las Vegas. Nevada Supreme Court Chief Justice Doug Herndon announced plans in May to establish a specialized business court internally. He believes this can happen within a year, circumventing the need for a constitutional change as proposed in AJR8.
Proponents argue the specialized business court could significantly boost the state’s revenue.
Nevada’s business-friendly shift explored
Companies that have recently moved their incorporation from Delaware to Nevada include X, Dropbox, and TripAdvisor.
TripAdvisor overcame a lawsuit from shareholders trying to block its re-incorporation in Nevada. Secretary of State Cisco Aguilar defended Nevada as a viable place for incorporation in an amicus brief during the case. One of Andreessen Horowitz’s co-founders, Benjamin Horowitz, already has strong ties to Las Vegas.
Benjamin and his wife, Felicia, have lived in the area since at least 2021 and have become prominent local donors. Earlier this year, Benjamin Horowitz donated 10 Tesla Cybertrucks to the Las Vegas Metropolitan Police Department. The couple has reportedly donated at least $7.6 million to the police department.
The Horowitzes have also been active in political donations, contributing $300,000 to political candidates over the past four years. This includes donations to Joe Lombardo, Kevin McMahill, Steve Wolfson, and Republican candidates running for the Nevada State Legislature. Andreessen Horowitz’s decision to move its incorporation to Nevada highlights the growing appeal of the state’s business-friendly policies and specialized business court initiatives.
This move could potentially herald a broader shift in corporate incorporation trends away from Delaware to Nevada.
