Sequoia's Unexpected Steward Shakeup
Description
The Week in Short
The lowdown on Sequoia’s decision to put Alfred Lin and Pat Grady in charge. OpenAI stirs the pot with talk of government guarantees. Ripple raises $500 million even as crypto stumbles. Beacon Software & Metropolis raise as AI roll-ups roll on. Mamdani’s win quiets critics, for now. Elon Musk gets his trillion-dollar Tesla incentive, designed to lure his attention back from xAI. Charles Schwab enters private-share arena with Forge Global acquisition, even as AI valuations wobble.
The Main Item
It makes a ton of sense that Pat Grady, 43, and Alfred Lin, 53, are running Sequoia Capital.
It’s just surprising that Roelof Botha’s run as Sequoia’s singular leader only lasted about three years.
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This week, Grady, the growth investor who has leaned into AI, and Lin, known for his investment in DoorDash, his stewardship of Airbnb, and his ignominious bet on FTX, became Sequoia stewards — stepping into shoes once held by venture capital greats like Doug Leone, Michael Moritz, and Don Valentine.
Botha — the 52-year-old investor in YouTube, Unity, and MongoDB — will shift into an advisory role, keeping an office at Sequoia and holding Sequoia board seats. But he will no longer run tech’s most envied venture capital firm.
Sequoia Capital has said that the firm has distributed $52 billion1 since Botha first became the Sequoia steward for the US and Europe in 2017. Botha took over the firm when Leone stepped back in 2022 and bumped Botha up to senior steward.
During his three years at the helm, Botha established a perpetual capital vehicle for Sequoia and split the US-Europe arm from the firm’s China and India businesses amidst a rising tide of nationalism.
Sequoia Capital is good at keeping a secret. We don’t have the full story as to why Botha is out. But here’s what we know:
Ahead of the leadership switch-up, Botha appeared on a string of interviews, including All-In, Jack Altman’s show, and TechCrunch Disrupt. He called venture capital “return-free risk.” The interviews didn’t quite have the valedictory feel — instead it gave the appearance that Botha was still very much in the job. So on Tuesday, when Sequoia announced Grady and Lin’s ascension, it felt to many observers that Botha was being caught blindsided by the leadership change.
Following the announcement, the Wall Street Journal reported that Botha was “asked to step aside after some Sequoia partners raised concerns about his leadership style.” From everything I’ve been able to gather, it sounds like that’s right: the timetable for his departure was not set by Botha and that Sequoia’s partnership made the call, with Botha ultimately joining them in supporting the new leaders.
There are three leading theories on what went wrong: (1) Botha has a brusque management style that turned off colleagues. (2) Despite Sequoia being among the top investment firms in Silicon Valley, the firm could have leaned into AI harder and OpenAI in particular, much more aggressively.2 And (3) he let partner Shaun Maguire run wild on X, posting incendiary political takes that have shaped Sequoia’s brand.
I think it’s mostly number one and somewhat number two. As to three, I think the firm could use a new strategy around its political positioning3 but I don’t think that drove this decision. I don’t think it helped that Botha, like many managing partners at other venture firms, seemed to make worse investments o
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