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Sequoia Capital, a US-based Venture Capital firm, announced on Thursday that it will launch a $500-600M (approx €439M – €530M) sub-fund focused primarily on ‘liquid tokens and digital assets’.
Founded in 1972 by Don Valentine, and based out of Menlo Park, California, Sequoia Capital invests in startups in the energy, financial, enterprise, healthcare, internet, and mobile industries.
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In October, 2021, the VC firm underwent significant structural changes. As per the new structure, the firm’s Limited Partners (LP) will invest in The Sequoia Capital Fund, an open-ended liquid portfolio of public positions in a select group of companies. The fund will then allocate capital to sub-funds for venture investments.
Sequoia Crypto Fund
Sequoia Crypto Fund is one of the first sub-funds under the broad umbrella of the Sequoia Capital Fund. Two other smaller funds, Ecosystem Fund and Expansion Fund, have also been created by Sequoia.
According to CoinDesk, around $950M (approx €835M) will be deployed towards the Ecosystem Fund that lets select founders of portfolio firms invest in other related companies. Sequoia’s Expansion Fund will be $3.5B (approx €3B), and will fund US and European growth-stage companies. Both the funds will back a range of technologies, including crypto.
The new funds will use capital already committed by Sequoia’s existing limited partners, rather than new funding, claims the company.
“We have a long-term view on crypto that it’s a megatrend over the next 20 years. It’s the future of money,” says Sequoia Partner Shaun Maguire to Bloomberg.
In its official blog, Sequoia Capital has mentioned that it has partnered with crypto founders like Sam Bankman-Fried (FTX), Jack Dorsey (Block), Uri Kolodny and Eli Ben-Sasson (StarkWare), Michael Shaulov (Fireblocks), Elena Nadolinski (Iron Fish), Yubo Ruan (Parallel), and Ming Wu (Strips).
“While we’ve invested in both equity and tokens over the last five years, many have asked that we take a more active role in managing our tokens, including staking them, providing liquidity, participating in governance and trading through their platforms,” says Sequoia partners Michelle Bailhe, Shaun Maguire and Alfred Lin in the post.
With this fund, the company aims to buy crypto tokens and use them in activities such as staking and voting on governance proposals, reports Cryptobriefing.
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