Sequoia Capital is splitting into three entities after the company announced it was “becoming increasingly complex to run a decentralized global investment business.”
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The venture capital firm said Sequoia India and Southeast Asia will become Peak XV Partners and Sequoia China will become HongShan, while the U.S. and European business will remain Sequoia Capital.
“It has become increasingly complex to run a decentralized global investment business,” Sequoia partners Roelof Botha, Neil Shen and Shailendra Singh said in a joint post.
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Sequoia China has made substantial investments into health care and traditional consumer sectors, invested in technology, started buyouts and launched a tech consumer public market fund.
But, the decision comes amid macroeconomic and geopolitical challenges that have made fundraising difficult and eaten into venture funds’ returns.
Investing in China by global investors, in particular, has slowed significantly as the world’s second-largest economy grapples with economic woes after pandemic curbs eased and since it tightened regulatory oversight that stymied growth in the technology and internet sectors.
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Sequoia’s India and Southeast Asia business was vital to building a startup ecosystem with transformative founder programs like Surge, Spark, Pathfinders and Guild.
Meanwhile, the U.S. and European teams built technology capabilities for their investors, opened a European office and created the Sequoia Capital Fund and Arc for seed-staged investors in the U.S. and Europe.
“Our founder-focused, local-first approach has been key to our success in each region,” they said. “The decision to establish teams with intimate understandings of their local networks and industries has enabled each entity to build a portfolio of category-leading companies.”
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Sequoia Capital will move to separate its partnerships with contemporaries in India and China and become singular entities no later than March 31, 2024.
Reuters contributed to this report.
