Sequoia Capital's Turbulent Year: Partners Exit On Heels Of FTX Collapse, $214M Loss

Venture firm Sequoia Capital has undergone significant changes over the past year, marked by market volatility, a split, and the departure of at least five investors.

What Happened: Michael Moritz, a long-standing partner since 1986, is stepping away from the venture firm to concentrate on Sequoia Heritage, a wealth management business he co-founded that exceeds $15 billion. A significant portion of his family foundation, Crankstart, is held at Heritage.

Moritz will continue to serve on the boards of various Sequoia companies, such as Stripe Inc., but will gradually step down from these roles, according to Bloomberg News.

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Sequoia's Roelof Botha praised Moritz's contributions in the note, highlighting Moritz's investments in companies like Google GOOGL and PayPal PYPL.

"He helped establish Sequoia as one of the leading technology investment groups in the world," Botha said.

Moritz isn't the only Sequoia partner exiting the firm.

Mike Vernal, another senior partner, is also departing, along with Michelle Fradin, an investor in FTX FTT/USD, as well as Kais Khimji and Daniel Chen.

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Why It Matters: Despite profitable returns since launching in 1972, Sequoia suffered a $214 million loss, primarily from its global growth fund. However, this loss was a small fraction of the fund's realized and unrealized gains of about $7.5 billion.

Fradin was a relatively new partner who played a key role in the decision to invest in FTX before the crypto startup went bankrupt, according to Bloomberg.

There's also Chen, who identifies himself as a "crypto maxi" on Twitter.

Khimji, who joined in 2019, focused on later-stage companies. Vernal joined the firm in 2016.

Meanwhile, Sequoia recently announced a significant split with its operations in China and India in June, partly due to increasing pressure on Silicon Valley to distance itself from China amidst escalating geopolitical tensions.

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