Last week, following Edward Snowden’s widely discussed interview with NBC News, the famed venture capitalist behind Andreessen Horowitz (AH from here on in) and cofounder of Netscape, Marc Andreessen, declared that Edward Snowden was not a hero but a “traitor.” The textbook definition, he says.

Why would Andreessen, long a proponent of the freedom of information and vocal supporter of causes like open source software, condemn Edward Snowden for showing the American people that they have forsaken every right to privacy that they once held dear? That virtually every electronic device of significance was so insecure it could be turned into a secret listening device for the government unbeknownst to its owner? And that many of the companies we trust with our information were willingly providing the government support in this mass-scale snooping without so much as a whiff of dissent or attempt to notify users of services they once thought secure?

(Not quite clear on how bad the cybersecurity threat is? Try reading our extensive report on what’s lurking out there and how to protect yourself, even from the NSA…)

I’ve been a little hard on Mr. Andreessen lately—though like a politician or an anchor on Fox News, he has an awful lot to say, which just makes it too easy to pick out the occasional slip and have some fun with it Daily Show-style.

But I have to give the man credit where it’s due. He has built some phenomenally successful technologies and later, companies, in his life. Netscape was once the king of the browser hill, making the web we know today possible to begin with. That’s huge. Yes, it eventually blew up completely and what remains is a shell of the company that once set the standard for the web. Thankfully for Andreessen, he cashed out right at the top, with the AOL acquisition deal closing at over $10 billion in 1999 (a big rise from the $4.2 billion it was worth at the time it was originally announced, just further testament to the heady days of the dot-com era).

Still, his accomplishment with Netscape shouldn’t be understated. Nor should his leadership in areas like infrastructure as a service (IaaS), where his firm LoudCloud did a decade earlier what Amazon is doing now, and sold for $1.6 billion to HP, with another chunk sold along the way to EDS.

And since then, what he’s done with some of that money is impressive too. His VC firm was behind such disruptive technology companies as Twitter and LinkedIn. Virtual hotelier Airbnb is one of its prize portfolio holdings today. The company turned a 2% stake in Skype into a quick 300% gain when the company sold to Microsoft for over $8 billion.

So, why is Andreessen a terrorist? Because he is busy scaring the proverbial crap out of people across the globe—businesses, individuals, regulators, and more. He’s putting people out of jobs, left and right. He’s wreaking havoc on the economy.

And, like Edward Snowden, I am of the mind that all the pain Andreessen is causing will be well worth it in the end. That’s because there is little evolution without revolution.

Creative Destruction

In Andreessen’s August 2011 essay for the Wall Street Journal, “Why Software Is Eating the World,” he foretold the recent spike in highly disruptive businesses and laid out the basic blueprint for his investment philosophy.

Take anything inefficient and innovate. Don’t worry about who you take down in the process, or if there will be any jobs remaining at the end of the day.

For example, just look at the fear and loathing he’s created in the hotel industry. One of AH’s star investments, Airbnb, is a great example of that. They allow anyone with a studio apartment, a five-bedroom vacation home, or even a spare bed in the living room—be it in New York, Toledo, or Timbuktu—to turn their real estate into a mini-hotel empire.

I use it myself to find rooms when I travel and can’t find a reasonable hotel, as well as to rent my own properties out when I’m not using them—the potential for this model is plain as day to me. Suddenly, millions of travelers have a new option for lodging—and excess supply has a tendency to drop prices in any market. Not only that, but this new option provides FAR more variety than the “would you like a mediocre bed in an ugly room, or a slightly less awful bed in a nicely decorated room?” false choice of the hotel industry. And it allows real estate that was sitting idle before to become a revenue-generating asset, changing the very value of properties in tourist-friendly areas or frequent business travel destinations. It’s by no means perfect, but neither are its competitors.

And now it has gotten so popular that hotel executives have started dancing around the topic when asked about it.

“I think for us to say we’re not concerned or focused on Airbnb, would be very short-sighted,” Simon Turner, president of global development at Starwood Hotels and Resorts, said during a panel discussion at the 36th Annual New York University International Hospitality Industry Investment Conference in Manhattan June 3.

A year ago they wouldn’t even acknowledge the site existed. Now, Wall Street is talking IPO, and at big valuations, and suddenly the hoteliers are scrambling to act nonchalant—a typical corporate reaction to missing the boat.

Just how big did they miss it? Well, Marriott, one of the largest companies in the hotel business, has a market cap of about $18 billion and ended last year managing roughly 670,000 hotel rooms. Not bad for an over 75-year run.

Airbnb, on the other hand, in just four years, has managed to grow to 600,000 properties, doubling just in the last year. In the blink of an eye, it’s grown to represent more properties than Hyatt, Choice, Accor, Starwood, Best Western, Home Inns, and many other industry veterans. And by the end of this year, it’ll be ahead of IHG, Hilton, and Wyndham… is it any wonder why Marriott’s big message in last year’s annual report was all about how it plans to add 195,000 more rooms globally?

Inventory is, by no means, all that matters—occupancy rates, for one, don’t even compare—but it makes everything else possible.

Add demand to that inventory and you have a very potent formula for growth. The constant onslaught of articles like this one, many stemming from the very public fight with NYC over hotel room taxes, have provided a very cheap way for Airbnb to grow brand recognition and drive new users. After kicking it off mainly for vacationers, the company is even now starting to break into the lucrative business expense account market on which many hotels thrive. According to Tim MacDonald, EVP at expense management software firm Concur:

“We’re seeing Airbnb going from zero two years ago to $1 million this quarter,” MacDonald said. “It’s still small, less than 1 percent,” MacDonald said of the Airbnb market share. “It’s the rate of growth that is eye-popping.”

Surprisingly though, given the hype, Airbnb wasn’t the first and isn’t even the largest virtual hotelier. That distinction goes to Homeaway (AWAY), the already publicly traded company that owns Homeaway.com, VRBO.com, and a dozen other vacation rental portals and rental management tools it's acquired over the years. Homeaway represents over 800,000 properties and is also growing at a rapid clip.

But Airbnb even forced Homeaway to react. Last year, AWAY had to change its pricing model to move from an annual subscription to a free listing with a booking-commission pricing model, as property owners were flocking to Airbnb because there was no pay-to-play requirement.

Expedia and Priceline put themselves between hotels and travelers, sucking up a large part of hotel companies’ margins and building hundred-billion-dollar businesses in the process. But Airbnb and Homeaway aren’t just aggregating supply and demand, they have introduced a huge new inventory to the market—one that caters to travelers who couldn’t care less about a concierge (they have Yelp), or a bellboy (is carrying a suitcase for 15 seconds really that hard?), room service (that’s awful and costs a fortune), a mini-bar (really? Is this an episode of Mad Men?), the morning paper under the door (so that’s who keeps buying those…), or waiting 30 minutes in line just to check in—rapidly upsetting the balance of supply and demand.

Whatever happens with the much rumored Airbnb IPO, there is one thing that cannot be argued with: the virtual rental property market is forcing huge changes to the travel industry. Scary changes for many.

This is Andreessen’s MO. He spelled it out clearly in that article. Software = automation = productivity. Which he intends to bring to every conceivable industry. And he’s got the money and experience to do so.

Why, then, would a guy so dedicated to disrupting the status quo, so supportive of open information and access and collaboration, pile on to the Edward Snowden bashing?

A Favor for a Friend?

Though I doubt he’d ever admit it publicly (as doing so would undo it all), I would bet it’s because he needs to trade favors. You see, Andreessen has a lot to gain or lose from his ability to ingratiate himself with Washington, DC. It’s why he started appointing political bigwigs to his advisory board back in 2011—Larry Summers, a longtime politico and known close advisor of President Obama, joined his firm then, along with Adrian Fenty, the slick ex-mayor of DC who’s been a full-time lobbyist and consultant since leaving office.

And now, more than ever, he needs that clout. He needs it to get his next disruptive investment through what is arguably the most difficult-to-maneuver regulatory thicket in the world: the US banking system. According to his own public statement, AH has poured tens of millions of dollars into start-ups based on Bitcoin technology. And, as any follower of cryptocurrencies knows, there is a huge regulatory wall to be climbed before any mainstream adoption could ever be possible.

With one stroke of the pen, Congress can instantly put the technology to a near-dead stop by criminalizing its use. Heck, they probably don’t even need to pass a law—there are plenty of them on the books that already make it illegal to trade commodities and currencies without all sorts of license. These can be used against efforts to try and hide those illegal financial transactions by making your customers anonymous or your books obscured, both of which are central tenets of most Bitcoin businesses today.

One quick call to Eric Holder’s office with a clarification that Bitcoin is to be considered a real currency, or even just a security, and its trading partners are now either banks or broker-dealers, and the investment implications of Bitcoin change overnight. All the companies hosting or making markets in the currency would be instantly subject to anti-money laundering laws, international and correspondent bank reporting requirements, “know your customer” rules, NBBO rules, Dodd-Frank, and the hundreds of others bills and thousands upon thousands of regulations that govern dealing in securities and currency—Dodd-Frank alone is 14,000 pages.

That’d be the end of Bitcoin in America, at least for half a decade or longer while regulators took their sweet time creating the “proper” regulatory environment.

Just look at what happened to Lending Club, the online marketplace for lending money to other consumers in a crowd-funded model, when it came into the SEC’s sights. The company had to shut its entire business down for nearly two years while the SEC decided how many hoops the company would have to jump through to allow me and a thousand others to lend $25 each to Bob in Maine—like there had never been such a thing as an unsecured bond dreamt of before.

That’s how things work in regulatory land. Commissions are chartered. Committees staffed. Subcommittees recommended. Documentation of every minute detail demanded. All with very little urgency, because the only incentive in government is to not screw up and cause a news story. That will surely get you fired. But speed… that buys you nothing. There’s no profit on the line or worry about burn rates.

However, there is one surefire way to speed things up in government: have friends in high places. And to help those friends out when they are losing a battle for public perception—like with Snowden.

Here you have someone like Andreessen, who’s very much in need of a few favors from Washington, right when they could use someone with technology clout on their side.

I couldn’t disagree more with Andreessen’s characterization of Snowden. This stuff has been reported for years and ignored for just as long. The cause needed a champion. Snowden’s an odd duck, that’s for sure. But he’s the first person anyone has listened to on the subject, and for that he deserves applauding as whistleblower (“hero” is far too strong a term for me to use), not lambasting as a traitor.

But I can respect Andreessen’s motivation (or, at least, what I suspect are his motivations—this is pure conjecture, to be clear) for being out there on the subject. He is a great investor with great instincts. And those include political instincts, which are very necessary to survive in technology. After all, tech is the biggest single component of the American economy today. For instance, pure play technology accounts for the largest percentage of S&P 500 market cap after finance, which itself is, of course, largely a tech game today. That also doesn’t even include huge companies known for their technology prowess, like Walmart and UPS and Waste Management. And when you are that big a target, you become a very attractive one for regulation, taxes, and other burdens.

Just look at the rules imposed on technology giants like Microsoft and Google over the years—data privacy laws (ironic from a government that conveniently ignores them all), antitrust rulings, SOPA/PIPA, the DMCA, etc. Or the constant flipping and flopping over Net neutrality… which was once explained to me, by someone who would know, as a good way to suck donations out of both sides of the debate over and over again.

(If you have not yet seen it, Daily Show alum John Oliver did a spectacular piece on the boring but incredibly important Net neutrality debate.)

Even if Congress does have its way with technology companies on occasion, the reverse is even more often true. Big tech has proven far savvier at manipulating, or outright sidestepping, government than vice versa. Just look no further than the hottest kid on the block, virtual taxi-hailing app Uber, which recently took on an investment at a whopping $17 billion valuation.

Now, we’ve talked about how big a business tax medallions are, but it’s still a very local business—and a highly regulated one too.

• Land in a strange city and how do you go about finding a cab? Good luck if you can’t find a taxi stand and the streets are empty. Or if it’s raining.

• Need a ride home from the bar after an evening celebrating the big new product launch? You better ask the bartender. Or maybe use Google to find a dispatch number.

• Even after you arrange your ride, you generally have no idea what it’s going to cost, and in many cities they still don’t take credit cards (show me an all-cash business and I’ll show you someone dodging taxes). And forget haggling over the fare—the meter sets that.

Uber, however, is changing that. Pop open its mobile app, click a button, and instantly you’ve got a quote for a ride and a car is on its way. The quotes are even dynamically priced according to demand (though I think that will end up running afoul of anti-price-gouging laws at some point, as fares have spiked a few hundred percent before during key events like New Year’s Eve in Times Square).

How does the company pull it off in cities where the local taxi authority keeps a strict lid on how many yellow cabs can roam the streets (and takes a strict cut of their profits)? Just like Airbnb, it found all new suppliers. Regular folks with a car and a need for some income.

It's making an end run around regulators and established suppliers—and it’s working, with a presence in 129 cities across 38 countries and growing.

Which is why Uber is now soliciting protests around the world. Last week, a union of Italian taxi drivers went on strike to protest a government decision not to consider the cars called through the Uber app as taxis, since they theoretically return to a home base between trips. Getting such a designation to begin with is no accident—that is a smart, long-term strategy.

It similarly convinced London authorities that its app didn’t count as a meter and, thus, wasn’t subject to regulation. That’s got taxi drivers there screaming with rage in recent hearings on the subject. Many are calling for a ban of Uber in the city.

That’s not going to fly though. Just like New York is going to struggle to stop Airbnb. That’s because enforcement is really difficult. Uber cars look like any other—no strip-club ads on the roof for certain. Airbnb apartments aren’t hanging signs out the window either. Any kind of local ban would require very expensive enforcement, like setting up a sting operation by hiring cars and then fining the drivers upon pickup. Imagine the local news after that one.

The alternative, of course, is to go to the companies and try to stop them from offering the app by geography. Again, imagine using Uber in 10 different cities, cracking open your phone in number 11, and getting a message that the local government doesn’t allow you to use the app there. Or having a spare car and no job and then finding out that if you just lived in Memphis you could be making some money with it.

Entrenched competitors will always scream bloody murder and call for protectionism. They’ll want these companies shut down altogether. But fighting these apps means angering both tourists and citizens. It’s not the reaction any politician really wants to see in their city’s policy and isn’t good for reelection. Neither, though, is angering local businesses, who will take their influence and campaign donations elsewhere.

So, expect to see lots of political talk about this and very little actual action—just like net neutrality. There’s a good political career to be made from making a stink but not actually jumping out in front of the flood. The one exception: taxes. Which, you can bet, is precisely what you’ll start seeing from Manhattan, London, and Rome. No politician is going to watch some punks from Silicon Valley eat up their budget without a fight.

An Unstoppable Rising Tide

The kind of disruption that Uber and Airbnb represent is only going to increase in the coming years. Especially, any business model that is based on regulator-granted exclusivity is going to be threatened by those who will work around the system.

That’s because Airbnb, Uber, Bitcoin, and countless other disruptive technologies are operating outside any kind of real regulatory regime. When the laws were written, these businesses could never even have been dreamt of, let alone been possible. These technologies also move far faster than any one government can react to. They cross borders and operate globally, making it hard for any regional bureaucracy to enforce its will. And that alone is a competitive advantage.

Uber cars can set their own rates. Or they can let the software do it for them, depending on demand. No taxi driver can compete with that. Which is why Uber is now courting taxi companies to join its ranks and compete head to head with non-licensed drivers—Uber tells them people will pay a little more for a known “professional” driver.

Airbnb property owners can often rent their places for more than any comparable hotel room and still be a better deal for customers. That’s because in most locations they aren’t subject to the onerous occupancy tax placed on hotel rooms around the world. Even where they are, most owners don’t bother complying because they are individually too small for those tax authorities to chase down.

Hotels will complain that Airbnb has an unfair advantage because of that. And that’s true. But instead of lobbying governments to tie them down with the same regulations that hotels are stuck with, as has been the battle cry of choice for the industry from the start, they should think about innovating like this themselves. After all, with well-connected, articulate, influential voices like Andreessen out there making sure the technology industry gets enough legal runway to get its disruptive businesses off the ground, there is little chance the established industry players will get their way through government. Once the technology cat is out of the bag, it’s staying that way. Just ask the newspaper industry. Or bookstores. Or music shops. Or film camera makers. Or digital camera makers after them.

Disruptive technology is like water on a dam. You can hold it back for a little while, but eventually it always breaks through. Especially when you only start piling sandbags the day you see floodwater rising, as has been the case with so many businesses, taxis and hotels included.

And, no, charging $150 a night in resort fees that are not in your advertised rate, or adding $20 to a two-mile taxi fare just because it swings by the front of the airport instead of the train station, is not innovation.

Maybe instead it’s time that taxi boards around the world realized they are all in it together and pooled some money toward building a company standard API for e-hailing cabs? Radio stations are doing that with iHeartRadio, trying to use their collective marketing muscle to stay in the race as Pandora and Spotify make broadcast, “one size fits all” music seem like a caveman-era relic.

The real question to come out of the work of Andreessen and so many other entrepreneurs and innovators is not “What will become of taxis?” It’s “What industry is next?”

Big returns await investors who can answer that question. Imagine investing in Amazon before it upended the publishing industry. Or Apple before it disrupted the music industry, and then the cellphone market. Netflix. Tesla. A mere thousand-dollar investment in any of these companies would now be worth tens or hundreds of thousands of dollars.