Silicon Valley venture capital firm Sequoia Capital has raised a total of $1.35 billion for two new funds that will invest across India and Southeast Asia, Sequoia India managing director Shailendra Singh announced on Monday.
In a LinkedIn post, Singh said the firm’s limited partners have collectively committed $825 million to a growth fund and another $525 million to a venture fund. With the two new funds and an existing seed fund, Sequoia India now invests across all the startup stages in India and Southeast Asia.
Its investments in the two markets include unicorns Byju’s, OYO, Gojek, Tokopedia, Traveloka and ONE Championship. In Southeast Asia, it has also invested in digital bank Tonik, coffee chain Kopi Kenangan, co-living space operator Hmlet, digital telecom and lifestyle services provider Circles.Life, and online marketplace Carousell, among others.
According to Sequoia India, Southeast Asia accounts for 20-30 per cent of its investments by value.
“We are excited about the depth of opportunities in this region, which is undergoing a massive technology-led transformation. The startup ecosystem in both India and SEA has come a very long way in the last few years,” Singh said.
Sequoia closed its sixth India fund at $695 million in August 2018. Its fifth vehicle raised $920 million in 2016. The latest fund marks the first time the VC firm has split the corpus into two vehicles – one for early-stage and another for growth-stage investments.
The firm had raised a separate $200-million fund last year under its Surge programme, which invests exclusively at the seed stage in startups based in India and Southeast Asia.
With the new funds, Sequoia India’s total assets under management have risen to over $5.78 billion.
|WestBridge Ventures I||$140 million||2000|
|WestBridge Ventures II||$200 million||2005|
|Sequoia Capital India Growth Fund I||$400 million||2006|
|Sequoia Capital India Fund III||$300 million||2007|
|Sequoia Capital India Growth Fund II||$725 million||2008|
|Sequoia Capital India Fund IV||$850 million||2017*|
|Sequoia Capital India Fund V||$920 million||2016|
|Sequoia Capital India Fund VI||$695 million||2018|
|Seed fund||$200 million||2019|
|Sequoia Capital India Venture VII Ltd||$525 million||2020|
|Sequoia Capital India Growth Fund III||$825 million||2020|
*The fund had initially raised $530 million in 2014. Sequoia later topped up with $210 million in 2015 and another $125 million in 2017.
Source: Media reports, Sequoia announcements
In his post on Monday, Singh noted that the global COVID-19 pandemic has left founders, investors, and startup employees scarred, with firms struggling to grow, thus preventing large profitable technology businesses in India and Southeast Asia from emerging.
“The COVID-19 pandemic is raging on and we’re in an unprecedented humanitarian and economic crisis. It has also been a time of reflection. Where are we in the journey of the startup ecosystem in India and SEA? What type of future should we aspire for?” Singh wrote.
However, the pandemic has also been a catalyst for positive change as founders have shown leadership and agility in adapting to the crisis, trimmed costs and unlocked new revenue levers, he said.
“We need to build on this COVID-induced state of high performance, stick to first principles, and remain relentless in our pursuit of sustainably successful companies,” he added.
A subsidiary of Sequoia Capital, Sequoia Capital India was formed in 2000 and is headquartered in Bengaluru with offices in Singapore, California, Israel, Hong Kong, Beijing, and China.
The year 2019, particularly, was good for Sequoia India in terms of returns on investments. It reportedly reaped good returns by paring its stake in some of its portfolio companies, including edtech unicorn Byju’s and hospitality major OYO. It mopped up about $450 million from a partial selldown in OYO. Sequoia has infused about $27 million into the company across different funding rounds.
“From our vantage point, the future of our region will be shaped by those few founders who are resolutely committed to building enduring companies with unshakable foundations. It will take a handful of exceptional founders to show us the way, to shine the light for others to follow,” Singh said.
In 2019, venture capital firms in Southeast Asia closed new funds totalling $3.5 billion, a 73 per cent rise from the nearly $2 billion raised in the previous year. Vertex Ventures, a unit of Singapore state investor Temasek Holdings, closed its largest India and Southeast Asia vehicle at $305 million.
Jungle Ventures, which was seeking to raise around $200 million for its third fund, ended up gathering $240 million for the vehicle. The year also saw Malaysia’s national oil company Petronas set up a new venture capital firm, Petronas Corporate Venture Capital, with a corpus of $350 million.