Sequoia takes issues severely. The storied enterprise agency is understood to react to macroeconomic occasions with grand memos geared toward portfolio firms and generally the entrepreneurship scene at massive.
Most lately, Sequoia created a 52-slide deck, first reported by The Information, 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 isn’t all the time proper in its prognostications — possibly why it caught to inner musings as a substitute of a Medium publish this time — but it surely does do a service in offering a snapshot of how one of the weathered, and profitable, VC corporations of all time thinks a couple of looming downturn.
Avisionews+ is having a Memorial Day sale. It can save you 50% on annual subscriptions for a restricted time.
“Our intention in gathering right this moment is to not be a beacon of gloom,” the deck reads. “However we additionally consider that successful within the years forward goes to rely on making laborious, decisive decisions confronting uncomfortable challenges that will have been masked throughout the exuberance and distortions of free capital over the previous two years.”
Sequoia’s recommendation largely adopted the identical script that different enterprise corporations have been utilizing: prolong runway, deal with sustainable development and acknowledge that an financial restoration could also be a methods away. There have been, nonetheless, some tidbits that stood out, reminiscent of a subtweet that I’m guessing is supposed for Tiger World and a exact clarification of how founders ought to outline fluff nowadays.
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 isn’t coming to the rescue” at this second:
