July 9 (Reuters) - Venture capital firm Andreessen Horowitz said on Wednesday it is relocating its main business entity, AH Capital Management, from Delaware to Nevada, citing Delaware's growing judicial bias against tech startup founders and their boards.

Also known as A16z, the firm said it could have made the move quietly but felt it was important for its stakeholders and the broader tech and VC communities to understand the reasons behind the decision, and also suggested its portfolio companies to consider making similar moves.

Delaware's Court of Chancery, which had "injected an unprecedented level of subjectivity into judicial decisions, undermining the court's reputation for unbiased expertise", had caused legal uncertainty, A16z, which has been an early backer in some of today's hottest AI companies, including Databricks and Elon Musk's xAI, said.

The move places A16z among a growing list of high-profile tech firms, including Tesla TSLA.O, SpaceX, Dropbox DBX.O, Tripadvisor and Bill Ackman's Pershing Square PSUS.N, that have opted to incorporate out of Delaware.

In recent years, corporate leaders have expressed frustration over court rulings that upset certain expectations about the state's law.

The debate intensified last year when a Delaware judge rescinded Elon Musk's $56 billion pay package, prompting Musk to urge other companies to follow Tesla and leave the state.

However, Delaware remains home to the majority of large public companies because its corporate laws protect board directors acting independently and in the company's best interest from being sued.

(Reporting by Chandni Shah in Bengaluru; Editing by Sumana Nandy)

((Chandni.shah@thomsonreuters.com;))