Amidst uncertainty over the future of startups due to Covid-19, often termed as a black swan event, Sequoia India has brought some good news for growth stage startups. The Indian arm of the Silicon Valley-based VC firm Sequoia Capital has announced two new funds – $525 million worth venture fund and $825 million growth fund – that will focus on investing in India and SEA region.
“We are deeply grateful to Sequoia’s LPs, who have committed $1.35B to two new Sequoia India venture and growth funds. The markets in India and SEA are deepening, our founders are world-class, our tech talent is formidable – but we need to hold ourselves to a higher bar. The region’s ecosystem is at a fork in the road – and we believe there is an opportunity to choose a different path,” said Shailendra J Singh, managing director at Sequoia Capital in a LinkedIn post.
With the latest addition, Sequoia India will now have three funds – seed, venture and growth – that will continue to invest across India and SEA.
For backing startups at the seed stage, Sequoia Capital India already runs a 16 week-long accelerator program called Surge, which had announced its first cohort in March 2019.
So far, Surge has selected over 52 startups across its three cohorts out of which 27 are from India. With the third cohort, Surge community had grown to over 110 founders with 52 startups based in six countries in just one year.
“We need to build on this Covid-induced state of high performance, stick to first principles, and remain relentless in our pursuit of sustainably successful companies,” added Singh.
The announcement of new funds, in this unprecedented time, will be a confidence booster for the Indian startup ecosystem which has been hit massively by the Covid-19 pandemic.
According to a recent survey jointly conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI) and Indian Angel Network (IAN), around 12% startups have already shut down their operations due to the crisis. Rest are majorly cutting down their operational and administrative expenses and expected to lay off more employees if the situation doesn’t settle to normal.
During the lockdown, right from early-stage firms to unicorns, startups had to let go of a significant portion of their workforce. Ola, Swiggy, Zomato, Udaan, Bounce, CarDekho, MakeMyTrip, BookMyShow, Curefit and several other startups have collectively fired thousands of employees as the nationwide lockdown severely hit their businesses.