Business
Sequoia Capital reportedly raising two funds, and despite slower VC environment, it’s not alone
Venture capital investments may be slower, but that seems to be giving venture capital firms some time to go out and raise funds of their own.
Sequoia Capital is the latest to reportedly be raising two new U.S.-focused funds, valued at up to $2.25 billion, The Information reported earlier this week.
The publication reported that Menlo Park-based Sequoia is looking at $1.5 billion for a U.S. growth fund focused on later-stage companies and a $750 million fund targeting earlier-stage startups. Those funds are expected to close in July.
This news comes out just over a month after the venture capital giant told founders that it was expecting a longer economic recovery. Colleagues reported Sequoia telling them, “With the cost of capital (both debt and equity) rising, the market is signaling a strong preference for companies who can generate cash today.”
Last October, TechCrunch reported on Sequoia Capital debuting a big shift in strategy as it looked to boost its returns amid increased competition in the market for startup financing. The storied venture capital firm announced that it was breaking with tradition, abandoning the traditional fund structure and their artificial timelines for returning LP capital. The firm’s future investments, it said, would now flow through a “singular, permanent structure” called The Sequoia Fund.
The VC firm is not alone in raising new funds lately. For example, earlier this week, Drive Capital said it raised another $1 billion to invest in startups located in the middle of the country, bringing its assets under management to $2.2 billion. Conversion Capital earlier this week announced a new $122 million fund to back early-stage fintech and infrastructure startups. Meanwhile, Simple Food Ventures made a first close toward its $15 million fund for healthier grocery store staples. Within the past few months, we also saw Anterra Capital announce its second global food and agriculture tech fund of $260 million and Vine Ventures close on $140 million, half of which will go into Israeli startups.
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