Sequoia Capital has appointed new leaders.

Lin—famed as the thoughtful backer of companies like DoorDash, Airbnb, and Citadel Securities—said something I’ve thought about many times since: That it’s important to be able to hold ideas in “extreme tension,” because that’s, in effect, the only path to truth, to knowing what your options truly are.

“The thing about holding things in tension, in extreme tension, is that the right answer is almost definitely somewhere in the middle,” Lin told me in an interview in 2024 about how he thinks about founders. “If you start in the middle and radiate out from there, you think ‘Oh, this is obvious, it makes sense.’ Then you limit the number of solutions you look at. If you look at the extreme and work towards the center, you traverse almost every single possibility. That’s why when people hold things in tension, they tend to come up with more options.”

Lin has consistently been recognized as a top-tier Silicon Valley VC. Yesterday, he emerged in a manner I find both surprising and, paradoxically, predictable: Sequoia announced that Roelof Botha would relinquish its role as the firm's leader, with Lin and fellow Sequoia partner Pat Grady assuming co-leadership. 

Now, this is surprising on some level: Botha is only 52, and the YouTube and Instagram investor has been leading Sequoia for nearly a decade (he’s been on his own as sole steward since 2022). At the same time, there’s a layer of inevitability: Sequoia has conducted generational transfers five times over its 53 years, has previously had co-stewards more often than not, and Grady and Lin are both uniquely suited to the task.

While Lin has led the firm’s early stage investing since 2017, Grady has steered Sequoia’s growth stage investing practice since 2015, leading deals in Snowflake, Zoom, ServiceNow, Harvey, and OpenEvidence. Both have longstanding reputations as excellent investors, proven over time in a business that even at its very best can be fickle. Lin is also on the board of Kalshi, and both led Sequoia’s investments in OpenAI. 

For those unfamiliar with Lin and Grady, here are some key details and connections: Lin's initial professional journey was marked by his tenure as chairman, COO, and CFO at Zappos, concluding with its significant acquisition by Amazon. Concurrently, Grady, the junior of the pair, commenced his career at Summit Partners before moving to Sequoia in 2007. (Lin later joined the firm in 2010.) Their backgrounds share certain similarities, as both have personal histories that originate far from the pinnacle of Silicon Valley: Lin's parents relocated from Taiwan when he was a child, and Grady was raised in a Wyoming coal mining area. 

Sequoia faces its own internal conflicts as it progresses; even with over $50 billion in assets under its management, Sequoia has consistently stated its priority is achieving top-tier returns and demonstrating the excellence that entails within a volatile, long-term sector. (Sequoia has slightly over 20 investors, a figure that has stayed steady.)

This occurs concurrently with shifting venture capital objectives—the sector is splitting into asset management firms and smaller entities, and politics is emerging as a more intricate point of contention. Certain companies, such as a16z, have embraced this, whereas others have sought to avoid political matters altogether. Sequoia has adopted a principled neutral stance, preserving the firm’s “institutional neutrality” while permitting its partners to express their political views individually. (This has historical precedent: Moritz was notably a Democrat; Leone was a prominent Republican.) While this strategy was effective for a considerable period, there are indications that this approach is showing signs of strain.

With Lin and Grady now at the helm, assuming the roles of who now tend to the most famous tree in venture capital, an era marked by significant contrasts and extremes unfolds. Their objective to maintain Sequoia's leading position in startup investments necessitates grappling with these very extremes, potentially leading them to a clearer outlook on venture capital's future trajectory.  

Term Sheet Podcast… This week, I talked to Cityblock Health cofounder and CEO Dr. Toyin Ajayi. A former physician, Ajayi saw how the system can sometimes work against patients, driving burnout and increasing costs. In 2017, she cofounded Cityblock Health, a tech-forward health care startup that provides care to underserved communities. We talked about doctors as entrepreneurs, health care reform, and AI. Listen and watch here. 

See you tomorrow,

Allie Garfinkle
X: @agarfinks
Email: [email protected]
Submit a deal for the Term Sheet newsletter here.

Allie Garfinkle curated the deals section of today’s newsletter. Subscribe here.

Venture Deals

- Beacon Software, a Toronto-based company that acquires software businesses, has raised a $250 million Series B. General Catalyst, Lightspeed, and D1 Capital led the round. 

- Parable, a New York-based AI impact measurement startup, has raised $16.5 million in seed funding. HOF Capital led the round, joined by Story Ventures, InMotion Ventures, Lasagna, Panache, Supercharge, and Tripe Impact Capital. 

Other

- Arctic Wolf announced plans to acquire ransomware detection company UpSight Security. Financial terms were not disclosed.