In the high-stakes world of venture capital, where most firms struggle to back even a single billion-dollar company, Sequoia Capital has made it look routine. From Apple to Google, PayPal to Airbnb, WhatsApp to Stripe, Sequoia’s portfolio reads like a hall of fame for tech unicorns. But what exactly sets it apart?
Founded in 1972 by Don Valentine, Sequoia didn’t just ride the tech wave—it helped create it. Valentine, a former semiconductor executive at Fairchild and National Semiconductor, had an intuition for where technology was headed and what types of entrepreneurs were capable of driving it. His early investment in Apple, when Steve Jobs was still in his twenties and working out of a garage, became legendary. Valentine wasn’t drawn to charisma or polish—he looked for obsession, focus, and deep product conviction. That blueprint would shape Sequoia’s approach for decades.
Trust-based investment approach
One of Sequoia’s enduring strengths lies in its deep conviction strategy. Unlike many VC firms that chase trends or spread bets widely across dozens of startups, Sequoia picks fewer companies and commits to them with intensity. Partners are known to dive deeply into the companies they back, often taking board seats, recruiting key executives, and working closely with founders during crisis moments. When Sequoia backed WhatsApp, it did so quietly but with conviction—eventually reaping a $3 billion return on a $60 million investment when Facebook acquired the company.
The firm also pioneered the concept of the venture capital platform. It provides a robust suite of services to founders, including help with executive hiring, legal and financial operations, public relations, and even mental health support. But what sets Sequoia’s platform apart is that it isn’t reactive—it’s predictive. The firm continuously gathers data from its portfolio and conducts post-mortems to understand what went right, what failed, and what patterns emerged. These insights are fed back into its investment playbook.
The inseparable role of behavioral science
These insights are fed back into its investment playbook.
Behavioral science plays a surprisingly large role in Sequoia’s decision-making. Inspired in part by Daniel Kahneman’s work on cognitive biases, the firm trains its partners to identify mental traps like overconfidence, confirmation bias, and loss aversion. Investment decisions are made with structured debate, where each partner must present both the case for and against a deal. This culture of intellectual honesty is one reason Sequoia has managed to avoid some of the fads that swept up less-disciplined firms.
Sequoia also takes a longer-term view than most venture capital firms. While many VCs look to exit within five to seven years, Sequoia restructured its U.S. fund in 2021 into an open-ended vehicle that allows it to hold stakes in companies like Stripe, Instacart, or DoorDash long after their IPOs. This structure mirrors hedge fund strategies and enables Sequoia to continue supporting companies during their public phase—a key differentiator in today’s market.
Global approach and sustainable leadership
Crucially, Sequoia has not remained static. It was one of the first Silicon Valley firms to go global, launching Sequoia India and Sequoia China in the early 2000s. Both operations became powerful investment engines in their own right. Though the firm later restructured its relationship with Sequoia China in 2023 amid geopolitical tensions, the decision to go international gave Sequoia a front-row seat in the next wave of global innovation, including investments in ByteDance (TikTok) and Meituan.
Leadership transitions have also been handled with rare elegance. After Don Valentine stepped back, Michael Moritz and Doug Leone took the reins, each leaving their imprint while preserving the firm’s ethos. Today, Roelof Botha and Alfred Lin lead the charge, combining sharp analytical minds with deep operational experience. Lin, for instance, was CFO and COO at Zappos before joining Sequoia and has since led investments in Airbnb, DoorDash, and Figma.
In a business defined by outliers, Sequoia has outperformed even the outliers. Its secret isn’t a single model, but a system: one that marries conviction with humility, data with gut feel, and bold bets with rigorous debate. Sequoia doesn’t just fund startups. It builds relationships, shapes strategy, and creates enduring value—one founder, one company, one generation at a time.
Prepared by Navruzakhon Burieva
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