Sequoia Capital to divide global business into multiple parts

Sequoia Capital, a venture capital firm, revealed its plans for a upcoming split, where it will divide into three separate partnerships catering to the United States, China, and Asian markets. The announcement was made on June 6 via the firm’s Twitter.

A move to restructure

Sequoia Capital, a venture capital firm, and supporter of cryptocurrency, has unveiled its plans for a major restructuring.

The company will divide its operations into three distinct branches, with its U.S. and European divisions continuing under the existing Sequoia brand.

Meanwhile, its arm serving India and Southeast Asia will undergo a rebranding as “Peak XV Partners,” while the China branch will retain its Chinese-language name and be known as “HongShan” in English. 

The targeted completion date for these changes is no later than March 31, 2024, according to company officials.

With this realignment, Sequoia Capital aims to maintain its focus on North American ventures through its U.S. arm, while providing dedicated services to the Chinese market through a separate branch and overseeing operations in India and other Asian markets through a third branch.

This move comes from a firm that gained prominence in the 1970s and made notable early investments in companies like Atari in 1975 and Apple in 1978.

In the cryptocurrency space, Sequoia Capital had participated in 24 blockchain or crypto deals as of August 2022, with Sequoia China and Sequoia India backing 15 and 23 deals, respectively. Other notable investments Sequoia made in 2021 were FTX and Fireblocks.

According to an interview with Roelof Botha, the CEO of Sequoia Capital, conducted by the Financial Times, the decision to split the firm into three separate entities was driven by the need to avoid clashes between globally ambitious ventures.

Botha highlighted the remarkable growth and success of the individual businesses in China and India, emphasizing that these ventures have evolved into thriving entities within their respective categories since he joined Sequoia in 2003.

Navigating regulatory uncertainties

Sequoia Capital believes this separation will help each regional entity pursue investment opportunities independently, a reality that becomes even more important given recent regulatory uncertainties in the United States and their tensions with China.

Since Sequoia Capital is known for its support of cryptocurrency, the restructuring could impact the firm’s investments and focus in the crypto space, especially when the impact of these tensions are largely unknown on the blockchain sector so far.