Sequoia files a statement revealing how much money is in Sequoia Capital Fund.
Nearly a year ago, the 50-year old investing powerhouse Sequoia Capital It announced it had reorganised itself around a single, permanent structure: the Sequoia Capital Fund.
Thanks to an SEC form We know the amount in the fund, $13.6 billion. Filed Friday
This number is a combination of two things. It represents the value Sequoia has rolled in its permanent fund from its legacy accounts. These are shares in publicly traded companies Sequoia supported as startups such as Airbnb, DoorDash and Unity. Sequoia owns some of these shares, while Sequoia’s limited partners have agreed to allow Sequoia to continue managing the shares for them.
New capital commitments of $13.6 billion will also be made. called down And invested in traditional funds that are lower than Sequoia’s permanent fund, such as a $195 million seed fund This was announced last year. If all goes according to plan, the money will be invested into startups that eventually go public and whose shares end up in Sequoia Capital Fund, a long, lucrative circle.
Sequoia explains that not all portfolio companies’ shares will be swept into the fund. Instead, the permanent fund is meant for a “resourceful” investor.selection of our enduring” businesses. Sequoia’s portfolio business Stripe, for instance, will not distribute Stripe shares to investors. Sequoia, assuming it has the blessings of its limited partners, is more likely move Stripe’s shares from its many vehicles into its Sequoia Capital Fund, with the expectation that they will continue rising in value.
Sequoia’s strategy was announced last year but implemented in the fall of 2021. It has come under fire. Last month, one of the firm’s limited partnerships told the editor that his institution would prefer to handle its distributions. However, Sequoia agreed to the long-hold strategy to maintain its relationship with the company. Industry watchers note that if Sequoia had distributed shares of the top-flying companies it owned in 2021 instead of holding them until the market crashed last spring, it would have produced more. vastly greater returns Its limited partners
The firm insists that it does not regret any of its actions. The firm insists that it has no regrets. sit-down Alfred Lin, a long-standing Sequoia partner, stated last month that Sequoia would not do anything different if it could turn back the clock to 2021. He stated that Sequoia is an investor for the long term and the only question it asks is “Whether?” [we] Think these companies will be worth much more in the future than they are now. This is not a three-month, one–month or one-year time frame.
Lin said that Sequoia Fund has invested in Sequoia Fund to help companies build for the long term. . . The best advantage is one that you believe in the long term. [in] Temporal arbitrage is the act of holding. People don’t like volatility so you are just arbitraging their nerves.
Although a Sequoia spokesperson declined comment, a source close the firm said that limited partners were locked up until the end this year. Sequoia Capital Fund has been banned from redemptions in its initial two years. But, going forward, Sequoia Capital Fund will allow investors to request liquidity via shares or cash.
In the meantime, it is not clear how much of $13.6 billion is tied up as shares and comes from new capital obligations. This money gets earmarked for Sequoia sub funds with each investor’s blessing. If history is any guide, an even more intriguing number will be revealed soon.
Sequoia, which was restructured as an investment advisor when creating its permanent fund had to file an annual form known as an ADV. This forms details investment style, assets under administration, and key officers.
The form was last filed March 31, last year. It showed that Sequoia had a staggering $85 billion in assets as of 12/31/21. Sequoia must file it annually. This means that Sequoia will soon share the most recent information on its assets under management.