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Sequoia is splitting into three entities — Sequoia Capital in U.S. and Europe, Peak XY Partners in India and Southeast Asia, and HongShan in China — as the storied venture firm scrambles to assess the increasing complex of managing a decentralized operation.
The split — which will go into effect by March next year — comes amid the growing geopolitical tension between China and the U.S., the world’s two largest economies. The India and Southeast Asia unit has also confronted some optics and governance issues at its portfolio firms.
Sequoia downplayed why it was splitting up. “It has become increasingly complex to run a decentralized global investment business. For example, each business has evolved to meet the opportunities in their markets across a wide range of sectors,” the firm said in a post, co-authored by regional heads Roelof Botha, Neil Shen and Shailendra Singh.
“This has made using centralized back-office functions more of a hindrance than an advantage. Additionally, as each entity’s portfolio has expanded to include companies that are becoming global leaders, we’ve seen growing market confusion due to the shared Sequoia brand as well as portfolio conflicts across entities.”
Peak XV Partners, which under its previous brand name raised $9.2 billion across 13 funds and invested in over 400 startups in the region, will now look to deploy some $2.5 billion it raised last year, the India and SEA unit said.
More to follow.
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