Sequoia Capital shuts down Scouts program after 17 years

The fund that in 2009 was the first to give start-up founders money to invest on its behalf is winding down this model. Other funds are also scaling back similar programs.

Sequoia Capital, one of the largest American venture capital funds (VC, meaning funds that invest in young companies in exchange for equity), is shutting down the Scouts program. It announced the decision on November 4, 2026, in the memo “The Sequoia of Tomorrow,” published on X and signed by seven general partners. As part of the same restructuring, the fund is winding down the Arc accelerator (a support program for groups of young companies), closing its London office, and merging the teams investing in early and later stages of company development. In the memo, it also said it had raised around $10 billion in new funds.

The program had been operating since 2009. Selected start-up founders and managers initially received up to $100,000 each to invest in very early-stage companies, and they invested on Sequoia's behalf. One of the scouts, Jason Calacanis, pointed the fund to Uber. According to TechCrunch, by 2019 more than 230 companies backed by scouts had raised more than $6 billion in subsequent rounds in total. Many other funds copied the model.

Sequoia did not criticize the model itself in the memo. It presented the decision as part of a plan to focus on a smaller number of people and projects. TechCrunch points to two reasons why scouting is losing its appeal: experienced managers and entrepreneurs can earn more by investing their own money as angel investors, and the biggest players are less often afraid of missing a good deal because the best start-up founders come to them on their own - except at the very earliest stage and in niches and regions where funds have less reach. Dealroom adds the rising costs of maintaining a scout network. Andreessen Horowitz had already reduced the number of its scouts earlier this year, giving the remaining ones larger budgets.

Reactions are mixed. Investor Sheel Mohnot wrote on X that the program never made sense to him, and he expects other funds to shut down theirs. Roxanne Varza, head of Paris-based Station F and a Sequoia scout in 2020-2025, wrote that she is saddened by the decision. In her view, scout programs helped build a culture of early-stage investing in Europe, and deals in the venture partner model will probably continue to be made.

For start-ups looking for their first investors, this means fewer paths to large funds through networks of entrepreneur acquaintances and a bigger role for angel investors investing on their own account.