Analysis: Sequoia Capital marked up its 2020 flagship US VC fund, which closed at ~$808M in 2022, by 24.6% in the 12 months ended in June 2024, with no exits
Rosie Bradbury / PitchBook :
Context & Ripple Effects
Sequoia had already raised nearly $1B for later-stage US investments alongside larger venture and growth vehicles in its earlier US and China fundraising, placing this fund within a long-running effort to deploy capital across stages.
The reported paper gain contrasts with a later picture of an expanding platform: Sequoia's evergreen vehicle was reported to have grown from $13.6B to $19.6B, while the firm was also reported to be raising a new fund under new leadership. The key issue is whether portfolio appreciation can ultimately translate into liquidity.
First-order effects
- The fund's investors receive a higher reported valuation for their holdings, but no cash realization from exits during the period.
- Sequoia can point to portfolio-value appreciation in the vehicle, while its reported performance remains dependent on unrealized marks rather than completed sales or listings.
Second-order effects
- Limited partners evaluating Sequoia's results must separate reported value growth from distributions, making the timing and quality of future exits more important to re-up decisions.
- The result reinforces the advantage of a manager able to keep raising and managing capital across vehicles, including the reported growth of Sequoia's evergreen fund, even when a particular fund has not produced exits.
Third-order effects
- If similar fund reports persist, VC performance comparisons will increasingly turn on the gap between interim marks and returned cash, rather than headline net-asset-value gains alone.
- Large multi-vehicle firms may be better positioned to sustain deployment through long exit cycles, potentially concentrating LP commitments among established platforms; that outcome still depends on eventual realizations.
The trend: This is one data point in venture capital's shift toward larger, durable fund platforms whose reported portfolio appreciation can outpace exit-driven liquidity.