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Veil of secrecy lifted at high-powered VC firm, Sequoia

The top venture capital firms in Silicon Valley, foremost among them Sequoia Capital, have sought to keep secret their list of investors.

Sequoia, the backer of successful companies like Google, Yahoo and Cisco, is one of the valley's top-performing venture firms. There's now a way to see a list of investors in Sequoia's latest fund here (scroll down to page 14), which has so far not been made public. It comes via this post from VentureBlog's Hornick.

He found it in a registration statement with the Securities and Exchange Commission by Tumbleweed Communications. Tumbleweed purchased a Sequoia Capital backed company, Corvigo, and so Tumbleweed registered about five million shares of stock in the name of Sequoia -- and by doing so, listed the limited partners of Sequoia (known as LPs). They are the limited partners in Sequoia's tenth fund.

So, what do we find of interest? It's largely a group of typical investors for such a firm, including respected private universities and wealthy individuals, trust funds and foundations. No surprise that Andy Bechtolsheim and Ram Shriram, two of the early angel investors in Google, are investors (they brought Google to Sequoia back in 1999, and so Sequoia obviously returns the favor by letting them invest in Sequoia).

Note that Hornick is wrong, however, when he says there are no public investors included on the list. Thanks to Dan Primack, who brings this to our attention in this interesting discussion here. Sequoia's list includes the University of California, which is funded by California tax money. When the Mercury News filed a lawsuit in 2003 to obtain the financial performance data on UC's investment in Sequoia (arguing that it was public money and so the public should have oversight rights), Sequoia moved to oust UC from its latest 2003 fund, Fund XI. It did so on August 27, 2003. However, it merely requested that UC sell its stakes in Sequoia's previous funds, something UC apparently didn't agree to (UC wasn't obligated to). True, it could be that UC is still looking for a way to sell its stakes profitably, but let's assume for now that UC is hanging tough. In answer to Primack, who seems a bit perplexed by UC's presence in X, we'd point out that it would be a bit senseless for Sequoia to take UC to court over this. After all, this VC game is one of the Rolodex. With UC Berkeley and other UC campuses the source of great talent and ideas for start-ups, it would be nuts for Sequoia to burn its bridges with UC's engineering students and professors (whose retirement money is tied directly with UC investments such as those in Sequoia). We don't know why Michigan agreed to sell its stake, but we'd argue that Michigan is no UC when it comes to sourcing of high-tech start-ups, so Sequoia may have been a bit lighter in its touch.


Mea culpa. I didn't actually say that there were no public entities in the Sequoia fund. I said that there were no public pension funds. But the inference was the same. I stand corrected. The interesting question is whether or not UC was allowed to invest in Sequoia's new fund. We may have to wait a few years before we get a registration statement that will answer that question.

David Hornik on November 19, 2004 3:38 PM
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No problem. Thanks for doing the digging, you're putting us reporters to shame. But regarding UC, it is confusing. The bulk of its investments are made from its pension fund, not its endowment, and so it is arguably indeed a "public pension fund."

Matt Marshall on November 19, 2004 3:53 PM
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