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Sequoia Knows What’sApp When It Comes to Finding the Exit

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February 20, 2014

This week Sequoia has outpunched its rivals in the venture capital industry with the potential return on it WhatsApp investment, which Facebook acquired for an eye-popping USD 19 billion in a cash and stock deal. It is eye popping because WhatsApp is a free mobile app and it only employs 32 engineers, according to WSJ Moneybeat.

 

Media sources (such as TechCrunch) are suggesting that Sequoia, which it says was the only VC to back the startup, put in about USD 60 million over three years for a stake of about 20%. Its stake is now worth about USD 3 billion in cash and stock. If the deal goes through it will provide a 2x return on the entire USD 1.3 billion fund from which the initial WhatsApp investment came from, and it represents a 50x return on Sequoia’s total  investment in the company.

 

This is not the only exit for Sequoia Capital, which is one of the US’ oldest and best known VC brands. According to CB Insights, it leads the list of investors who have seen the most Silicon Valley-based tech exits over the time period covered in the report, followed by micro VC fund Felicis Ventures. Sequoia’s Silicon Valley tech exits include Jive Software, FireEye and Meraki while Felicis counts Climate Corp, Wildfire and Meraki as well. (Image Source: cbinsights)

 

The top five Silicon Valley VCs to Exit in 2013

1.Sequoia Capital
2.Felicis Ventures
3.Accel Partners
4.New Enterprise Associates
5.DAG Venture
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Clearly mobile technologies are highly valued, a sentiment reflected in new figures from CB Insights, which shows that VC investments have climbed to over USD 1 billion per quarter over the last two quarters, up from USD 968 in the and USD 555 million in comparable quarters of the previous year, as shown in the chart here.

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