Sequoia seeks up to $1.35b for India, Southeast Asia

The target ranges for venture and growth vehicles are $500-525 million and $775-825 million, respectively, according to a source familiar with the situation. A formal launch is expected ahead of the firm’s annual general meeting next month with a final close scheduled for June.

Sequoia raised $890 million in the previous cycle. This included $695 million for Sequoia Capital India VI, which closed in August 2018. The discrepancy between the two figures has not been explained. However, Sequoia has form in upsizing funds. The firm raised $530 million for its fourth India vehicle in 2014 and subsequently increased the corpus to $695 million. It reportedly ended up at $850 million. Fund V closed at $920 million in 2016.

Sequoia India launched its debut seed fund last year and is said to have raised around $200 million. This followed the roll-out of Surge, an accelerator program aimed at start-ups that are either based in or targeting India and Southeast Asia. Surge is intended to expand Sequoia’s mandate to support entrepreneurs through the most difficult stages of building a company.

The latest cycle differs from its predecessors in that there are separate pools of capital for venture and growth. It mirrors an internal restructuring about two years ago that saw the Sequoia India team split up into groups dedicated to each strategy.

The firm’s China affiliate already operates in this way. Sequoia China is currently deploying venture and growth funds of $550 million and $1.8 billion, respectively. In the most recent vintage, it introduced a $150 million seed vehicle. On a global level, Sequoia also has a growth fund of $8 billion that backs existing portfolio companies in the later stages. It is active in Asia.

The emergence of distinct venture and growth verticals in India and Southeast Asia could be seen to reflect a newfound maturity in both markets. Growth stage investments in India’s technology space reached a record $4.3 billion in 2019, more than the previous two years combined. In Southeast Asia it came to $2 billion, down from $3.6 billion the previous year, but a sevenfold increase on 2017.

There were 16 rounds of $200 million or more in India last year, compared to five in 2015, while 12 companies have closed investments of $500 million-plus in the past two years. Southeast Asia saw one round of $200 million or more in 2015. Last year there were seven. Since 2018, six start-ups have closed investments in excess of $500 million.

Sequoia’s unicorn exposure in India and Southeast Asia includes Oyo Rooms, Bjyu’s, Zomato, Go-Jek, and Tokopedia.

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• Topics
• South Asia
• Southeast Asia
• Venture
• Technology
• Fundraising
• India
• Sequoia Capital
• TMT