US — TechCrunch
Sequoia hits rewind, undoing 20 years of expansion
Policy2 min read
Sequoia Capital, a major venture capital firm (a company that invests money in young startups), is pulling back from its growth of the last 20 years. It is closing its London office, ending its Arc and Scouts programs, and returning its focus to Silicon Valley.
What happened
In a memo posted on X, Sequoia said it has raised about $10 billion in new funds. At the same time, it is closing its London office, shutting down its Arc accelerator and its Scouts program, merging its early-stage and growth teams, flattening its partnership structure, and ending the weekly Monday partner meeting. The memo frames these changes as looking forward, but they mostly undo what the firm built over the past two decades.
Key numbers and facts
- About $10 billion in new funds raised
- Sequoia opened its London office in 2020
- Arc launched in March 2022 and gave admitted companies $500,000 to $1 million up front
- Scouts began around 2009 and let founders and operators invest small amounts on Sequoia's behalf
- Seven general partners now run the firm day to day
Why the firm is changing course
Sequoia says it spent about 20 years expanding into many businesses and many countries. It says one unintended result was too much hierarchy. The firm is now going back to a smaller team focused more on Silicon Valley. Several famous deals started with Scouts. Jason Calacanis pointed Sequoia to Uber through the program, and Sam Altman brought in Stripe. Arc was Sequoia's answer to Y Combinator, a well-known program that helps very early startups.
Why it matters
Both Scouts and Arc were ways to find young founders early and in many places. Ending them means Sequoia is taking a different path to startups. For European founders, the change is hard to accept. Sequoia's London closure follows similar moves by Andreessen Horowitz and Coatue, and it suggests that the top investors are now focused on the Bay Area. Founders who want funding may feel more pressure to move to that region.
What to watch
- Whether Sequoia keeps funding European startups without a local office
- How the new team of seven general partners changes the firm's decisions
- Whether other venture firms copy Sequoia's move away from programs like Scouts and Arc
- Where people like Luciana Lixandru and Stephanie Zhan go next
Glossary
- Sequoia Capital
- A large venture capital firm that invests money in young companies in exchange for a share of ownership.
- Scouts
- A Sequoia program that gave small checks to founders and operators so they could invest for the firm and find deals.
- Arc
- Sequoia's startup accelerator, a short program that gives young companies money and help to grow quickly.
- Y Combinator
- A well-known startup accelerator that helps very early companies get started.