Venture Capital: Sequoia Capital Launches $195M Seed Venture Fund

January 19, 2023 | News, Venture Capital

The current downturn is discouraging founders from going forward with new ventures.

Sequoia Capital, the storied venture capital firm, has announced a new $195 million seed fund and plans to run three batches of its accelerator program, Arc, in 2023, up from two in the previous year.

Despite fewer companies starting up, Sequoia believes that now is a good time to invest in seed stage companies, as they are more insulated from the effects of the public market, which is passing through a period of tumult. (Forbes)

According to Jess Lee, Partner at Sequoia, the current levels of macroeconomic turbulence are much higher compared to 2008 or 2009.

“We have found across the vintages of Sequoia that companies built during these periods of uncertainty are often the most legendary ones,” Lee said in an interview with Forbes.

The firm’s leader, Roelof Botha, established an evergreen fund which allows Sequoia to hold stock in portfolio companies after they go public. However, this fund has taken a knocking after banner IPOs like DoorDash and Unity have fallen more than 70% from their peak stock prices.

The firm is now looking for “outlier” founders with exceptional vision, such as Mark Zuckerberg and Rippling’s Parker Conrad, and provides them with a seven-week program (dubbed Arc) to teach the tenets of company building. Some of the $195 funding will flow to this program, which commenced in 2022.

One tip from Lee: Arc participants or funded seed companies that are courageous enough to start a new venture in these uncertain times will have a huge hiring advantage. “The first ten hires are the DNA of a company — they set the tone and the culture,” she said. “Now is a better time to recruit than ever before. That’s why we’re leaning in.”

Related Story:  Sequoia Raises $2.85B Venture Fund For India, SouthEast Asia

Photo by Proxyclick Visitor Management System on Unsplash

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