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Sequoia is the most recent VC agency telling you to take the downturn critically – TechCrunch

Sequoia takes issues critically. The storied enterprise agency is thought to react to macroeconomic occasions with grand memos aimed toward portfolio firms and typically the entrepreneurship scene at giant.

Most not too long ago, Sequoia created a 52-slide deck, first reported by The Info, titled “Adapting to Endure.” The doc reads like a follow-up course to its infamously ill-timed “Coronavirus: The Black Swan of 2020” memo of March 2020.

The agency is just not all the time proper in its prognostications — possibly why it caught to inner musings as an alternative of a Medium submit this time — but it surely does do a service in offering a snapshot of how one of the crucial weathered, and profitable, VC companies of all time thinks a couple of looming downturn.

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“Our intention in gathering in the present day is to not be a beacon of gloom,” the deck reads. “However we additionally consider that profitable within the years forward goes to rely on making arduous, decisive decisions confronting uncomfortable challenges which will have been masked through the exuberance and distortions of free capital over the previous two years.”

Sequoia’s recommendation largely adopted the identical script that different enterprise companies have been utilizing: lengthen runway, give attention to sustainable development and acknowledge that an financial restoration could also be a methods away. There have been, nevertheless, some tidbits that stood out, comparable to a subtweet that I’m guessing is supposed for Tiger International and a exact rationalization of how founders ought to outline fluff lately.

The capital supplier blames capital itself — capitalism, huh?

One of many clearest subtweets throughout the deck is Sequoia’s commentary on cross-over funds. The agency says that “low-cost capital is just not coming to the rescue” at this second:



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