a16z Partner Chris Dixon: The Signal for Identifying Frontier Tech Companies Looks Like a 'Native Use Case' That Resembles a Toy
a16z partner Chris Dixon outlines his investment framework: what truly defines a technology wave is the creation of 'native use cases' that enable entirely new activities, rather than simply doing old things faster and cheaper; these native use cases often initially appear as toys and hobbies, and the key to judging their potential growth lies in understanding their rate of potential improvement.
Chris Dixon, a partner at the venture capital firm Andreessen Horowitz (a16z), announced on October 22, 2026, that he is renaming its crypto fund to "a16z Frontier." The investment scope will expand from crypto startups to broader "frontier startups"—companies building new technologies and creating markets that may take years to develop. However, more noteworthy than the name change is the specific identification method he subsequently outlined.
Dixon's core distinction is that early applications often merely do old things better, whereas what truly defines a technology wave are "native use cases"—entirely new activities that were previously impossible. He uses AI as an example: to date, AI has primarily been used to make programming and other knowledge work faster, better, and cheaper, which still falls under "doing old things better." He anticipates that completely unexpected new experiences will emerge next, and these are what will define this generation of AI.
So how does one judge whether an experiment that looks like a toy will grow into a mainstream product? Dixon's criterion is to understand its "potential rate of improvement"—the factors that can bend seemingly insignificant marginal growth into an exponential curve. He acknowledges that these experiments will initially appear strange and unserious, like toys and hobbies, but some will grow into mass-market products over time.
This framework did not come out of nowhere. After joining a16z in 2013, Dixon focused on long-horizon investments, with one theme being "new computing devices": the proliferation of smartphones made cameras, sensors, and chips better and cheaper, thereby spawning drones, AR/VR headsets, and wearables. Based on this, he invested in Oculus, Skydio, and Zipline. Another line was crypto, which he viewed as a new wave built upon social media and the open-source movement, leading to investments in Coinbase, Solana, Uniswap, and other projects.