Silicon Valley’s Sequoia is reducing the size of India’s funds by 25 percent with the risk investors taking a cautious view of the escalating early-stage technology investing ecosystem. After backing up a number of companies including beer brand Bira, OYO ecosystem and Zomato, Sequoia Capital is all set to raise an amount of $650 to 700 million for its India Fund VI which will be put across the internet, consumer as well as healthcare companies in India as well as Southeast Asia. Two years back, the largest venture capital pool of $920 million Fund V was deployed in India amidst the euphoria which was surrounding the internet startups.
For huge, growth-stage type investments, Sequoia will dip into its growth fund which is around $6 to 7 billion in size. This increase in the global growth fund is going to get a sizeable allocation with the dominance of SoftBank in the world of tech investing with its $100 billion vision fund. Other prominent geography where Sequoia runs a fund independently is China with a market that has generated returns. An email which was sent to the spokesperson of Sequoia Capital did not get a response as such till the time of going to the press.
An investor who has been backing all the local technology firms stated that for now, the small sized funds in the range of $150 to 300 million fit best for India and billion-dollar exist for venture capitals are based on paper valuations. Apart from Sequoia, all the other venture capital funds including Matrix Partners, Kalaari Capital, Nexus Venture Partners, and Lightspeed Venture Partners are in the middle of raising new funds as well so as to invest in the domestic startups.