Sequoia raises $2.85 bn to fund startups in India, Southeast Asia

Sequoia India and Sequoia Southeast Asia have collectively raised $2.85 billion across a set of funds to finance startups in the region.

The U.S.-based investor has allocated $2 billion for the Indian venture and growth funds. It is also setting up a dedicated fund worth $850 million for Southeast Asia.

This comes at a time when funding has dried up for many startups after investors turned risk averse amid a global market rout, forcing new-age companies to cut costs by laying off staff.

"This fundraise, which comes at a time when markets are starting to cool after a very long bull run, signals our deep commitment to the region and the faith our Limited Partners have in the long-term growth story of India and Southeast Asia," the investor, which has backed startups like BharatPe, says in a statement.

"The new funds will bolster our mission to help daring founders to build legendary companies from idea to IPO and beyond," it adds.

The VC firm intends to double down on its efforts to help founders build companies that will endure. "The startup and venture capital ecosystem in India and Southeast Asia has made great strides in the last decade and will continue to mature. Valuations and velocity will move with markets. What endures is value creation in terms of revenue growth, profitability and free cash flow rooted in real innovation, excellence in execution and a maniacal focus on customers," it says.

The region's startup ecosystem has grown rapidly in the last decade, aided by the acceleration of digital adoption and rising consumer incomes. Last year, India emerged as the third-largest startup ecosystem in the world, after the U.S. and China. Southeast Asia, meanwhile, is on track to become a $1 trillion digital economy by 2030. "Our initiatives in the region continue to reflect our desire to actively contribute to building and supporting the ecosystem in ways that go beyond capital. Surge, a 16 week programme of early stage startups that we launched in 2019, has grown to a community of 246 founders from 112 startups across more than 15 sectors," Sequoia says.

Last year, the VC firm launched Sequoia Spark, its fellowship for female founders, and Sequoia Build, its programme for growth stage startups looking to scale sustainably.

"We are at an exciting juncture in India and Southeast Asia, with ever-deepening markets, higher consumption power, supportive regulations and high talent density... There's a strong sense in the emerging economies and fast-changing societies across India and Southeast Asia that 'now is our time'. Many large companies with regional or global footprints will emerge from this region in the decade to come," the VC firm adds.