Sequoia has announced that it will be amicably splitting into three separate firms.
Key Details
- The company’s CEOs announced in a letter to limited partners on Tuesday that Sequoia would be split into three companies by March 2024.
- The Chinese and Indian branches of the company will be separated and renamed HongShan and Peak XV Partners.
- These three companies will not share infrastructure or operations, nor will they invest in each other’s investment funds.
- The breakup is considered amicable, with the three new CEOs telling Forbes there was conflict between the branches’ startup portfolios and international political pressure.
- CEO Roelof Botha hopes the three companies will remain distant cousins with a common heritage.
Why It’s News
With the global economy facing war, supply chain breakdowns, and general hostility, the amicable split is a long time coming for Sequoia. “Things seemed to be going in a direction where it gets harder, not easier. This isn’t a retreat saying, ‘white flag, we failed.’ It’s more of a victory in the sense that we have these fully independent businesses that can go even further,” says Botha.
It marks the end of Sequoia as a single company, having been a prominent leader in the investment world since it was founded in 1972. The company became a global brand with branches in India, China, Israel, and Europe. It found success as an investor in future famous brands such as ByteDance, Airbnb, WhatsApp, and Zoom.
While the Chinese arm of Sequoia has seen strong growth and business thanks to its strong investments, controversy has surrounded the Chinese government in recent years and complicated its investments. ByteDance is currently facing hostility from the U.S. government over claims that it let the Chinese government access sensitive data from the U.S. version of TikTok. China also faces investor issues as many leading voices leave the country for other markets.