Sequoia Capital is a household name.
I barely know about VC, but I've heard of Sequoia Capital. This is why.
1,000 VC's in the United States
130 billion VC investment per year in the U.S. market.
130 million invested per VC, distributed amongst, on average, 60 different startups.
10% of startups succeed:
- 20% fail in the first year.
- 30% fail in the second year.
- 50% fail in the 5th year.
- 70% fail in their 10th year.
These stats on startup success rates are not surprising.
When VCs manage, on average, 60 different startups at a given time, how can they adequately use 70% of their time to provide value to each of those companies?
This seems to be why Sequoia capital is one of the more coveted VCs in the space. They do not invest in many, rather a lucky few in which they have identified partnership potential.
“We are not passive financiers. We partner with very few companies. When we do, we roll up our sleeves and get to work helping on strategy, recruiting, and customer intros.”- Mike Vernal, partner @sequoia
Yet with 1,000 VC firms in the US, it appears Sequoia has competition...but not really. Sequoia provides an exceptional customer experience. Hear it from a founder themselves. So while they sit amongst others, Sequoia differentiates themselves by reputation.
But how did they come to build this reputation?
Why is their guidance more valuable than another’s? Is it replicable?
Are they actually in a sound position to prevail moving forward as it relates to competitive threats?
Until next time ✌️