Sequoia this week announced a broad overhaul in a memo posted to X, a move that includes closing its London office and shutting down its scout program. Observers warn that it would be a mistake to read too much into the London closure, since the British capital has a thriving AI scene. On the other hand, the decision to end scouts says more about where venture investing is headed.
That’s partly because 17 years ago, Sequoia pioneered the scouts model, in which select founders and operators write checks on the firm’s behalf. Amid increased competition for deal flow, many VC firms followed suit. But a consensus now seems to be emerging that the model has reached its limits in its current form.
Not everyone was sold on the model in the first place. “They pioneered the scout program but [to be honest] it never made sense to me!” VC Sheel Mohnot wrote on X this week. “The scouts themselves don’t really care that much about the investments, you can still miss (like they did with Uber), not sure what it gets you. I suspect other firms will shutter theirs too.” he added.
To be clear,
