Today, Y Combinator announced its
intent to acquire Sequoia Capital. This deal is still pending regulatory review
and a successful pitch by Sequoia managing partner Doug Leone on YC Summer 2016
Demo Day. We’re not disclosing the financial terms, but Sequoia’s
ownership of YC-backed companies will pass to us, so I’ll just say we’re once
again the largest outside shareholders in Airbnb, Dropbox, and Stripe.
Sequoia Capital has had an Incredible
Journey being the leader in venture capital investing in Silicon Valley for
most of the last 40 years. They have partnered with iconic companies like
Apple, Google, Yahoo, PayPal, YouTube, LinkedIn, and WhatsApp.
The acquisition will enable our firms
to realize a number of operational synergies. We have a blog and Sequoia
doesn’t. Sequoia’s day-long Monday partner meetings will be replaced with
Tuesday night dinners. And now YC companies will automatically receive a
Sequoia term sheet to negotiate better terms from other firms. Sequoia will become the new YCVC
group*, where they will take a hands-on role of turning YC’s best companies
into enduring franchises, which they have been doing anyway.
The combined entity will officially
be called “Sequoia Combinator”, but will do business as “YC”, as brevity is
very important to both organizations. The new YC logo will be changed from
orange to green as it is the color of sequoia leaves and money. Sir Michael
Moritz will become chairman and also return to his journalistic roots as editor
of Hacker News. Sequoia will help launch YC China, YC India, and YC Israel, and YC Forestry, which will
be focused on preservation of sequoia trees worldwide.
Alfred Lin from Sequoia adds “YC is a
perfect match for Sequoia because YC has been such a great source of deal flow
for us. We don’t have to beg to invest in them anymore.”
Justin Kan from YC adds “Sequoia has
so many partners on the Midas List and we’re really looking forward to learning
from real investors.”
We are so excited for the future!
*Sequoia LPs will have 30 days to export their data.