Sequoia Capital Is Raising up to $600M in New Sub-fund To Focus on Tokens

Founders have asked the firm to take a more active role in managing its tokens — this fund will give it that ability to engage further, it said


Blockworks exclusive art by Axel Rangel


key takeaways

  • The fifty-year-old company has $80 billion in assets under management
  • The firm’s involvement in crypto started back in 2015 when it began investing in the space through both equity and tokens

Sequoia Capital is launching a new $500 million to $600 million sub-fund focused primarily on liquid tokens and digital assets, a spokesperson confirmed with Blockworks on Thursday.

The capital plans to complement its other crypto investments in seed, venture, growth and expansion funds. It is also one of the first sub-funds to be launched as part of its new Sequoia Capital Fund, an open-ended liquid portfolio, the company said.

The founders have asked the firm to take a more active role in managing its tokens through staking, providing liquidity, participating in governance and trading through portfolio companies’ platforms. This fund will give it the ability to engage further, the company shared.

“Our goal with this fund is to participate more actively in protocols, better support token-only projects, and learn by doing ourselves,” Sequoia Capital’s Michelle Bailhe, Shaun Maguire and Alfred Lin wrote on the Sequoia blog.

The firm’s involvement in crypto started back in 2015 when it began investing in the space through both equity and tokens. In 2017, Sequoia invested through its main funds, while in 2021, 20% of its new investments throughout the US and Europe were in crypto.

“We believe that crypto is more than a sector; it’s a fundamental shift that will impact all sectors,” Sequoia noted. 

In general, Sequoia Capital invests in a number of sectors aside from crypto, such as technology, financial services, energy and healthcare. The fifty-year-old company has $80 billion in assets under management, according to PitchBook data.

This scale of investment is not uncommon for the firm. Sequoia Capital’s India branch led a $450 million private token sale in Polygon — a decentralized Ethereum scaling platform — earlier this month. Separately, in January, Sequoia and Paradigm invested $1.15 billion in Citadel Securities.

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