Forty-eight years ago, the partners at the VC firm Sequoia chose to set up shop at 2800 Sand Hill Road — just over a mile from Stanford’s campus in Menlo Park, California.
For decades, Sequoia rode a core principle that is either genius, or an extreme aversion to long-distance exercise: “If we can’t ride a bicycle to [the company], we won’t invest.”
That mantra helped build Silicon Valley into a global hotbed for startup activity.
It all started with Apple
In 1977 Sequoia invested $150k in a fruit company a little PC-maker called Apple.
The position was closed in 1979, before Apple’s IPO, for roughly $6m — a healthy return, but shockingly low relative to what the firm would’ve made in the coming years.
Sequoia learned the lesson of prematurely selling a winner, and set out to not make the same mistake again. It now invests across a company’s entire life cycle, from seed round to late-stage growth.
And its winning bets have been huge
Some notable ones, per CB Insights:
- It co-led Google’s Series B in 1999, turning $12.5m into $4.3B during the search engine’s 2004 IPO (a 300x return).
- It invested $60m in WhatsApp in 2008, netting nearly $3B when the company was acquired by Facebook in 2014.
- It made a $1.2m seed investment in Dropbox, which turned into $2B when the cloud provider IPO’d.
Other wins include Oracle, Nvidia, Zoom, PayPal, and LinkedIn.
The future of Sequoia
2020 has been another busy year for Sequoia, with investments in Snowflake, Unity Software, Airbnb, and DoorDash.
Now, per Forbes, Sequoia is opening its first office in Europe.
The firm has expanded over the years (Israel in 1999, China in 2005, India in 2006), but its absence from Europe was always a strike against the continent, which displays chronic symptoms of US Big Tech envy.
However, an early investment in Swedish payment provider Klarna wised up the firm to the opportunities across the pond and paved the way for Sequoia’s new London office.
In September, Klarna was valued at $10.65B, making it Europe’s highest-valued private fintech company.
With that score, expect to see Sequoia bikes cruising all around the Old World.
