Sequoia this week unveiled a comprehensive overhaul in a memo posted on X, which entails closing its London office and discontinuing its scout program. Analysts caution that the London closure should not be overinterpreted, given the city’s vibrant AI ecosystem. Conversely, the termination of the scout program reflects broader shifts in venture capital investing.
This shift stems partly from Sequoia’s introduction of the scout model 17 years ago, wherein selected founders and operators execute investments on the firm’s behalf. With rising competition for deal opportunities, numerous venture firms adopted the approach. However, a growing consensus indicates that the model has now reached its constraints in its present configuration.
Not all observers embraced the model initially. “They launched the scout program, but honestly it never made sense to me,” venture capitalist Sheel Mohnot posted on X this week. “Scouts often show limited focus on the actual investments, and high-profile misses—such as Uber—raise questions about their value proposition. I anticipate that other firms will follow suit and close their programs,” he added.
Clarifying that the memo did not criticize scouts, Sequoia positioned the move as part of a broader focus strategy. Its aim to “allocate more energy toward fewer people and initiatives” is expected to resonate with those skeptical of the “spray and pray” scouting methodology.
For example, rival firm Andreessen Horowitz (a16z) launched a global scout network to identify opportunities across the United States and smaller European hubs. Yet a16z partner Gabriel Vasquez told TechCrunch earlier this year that the firm had revamped its program to concentrate more intensely “on the top talent.”
Under this revised model, Vasquez noted, scouts receive increased resources while being expected to assume a more active role, such as co‑hosting events with the firm. “They obtain a larger budget, but the headcount has been trimmed,” he explained.
This also suggests that venture capital firms themselves are leading the model’s overhaul. For founders, serving as a scout remains appealing: it offers proximity to firms that may provide funding in the future—or even a partnership role—and enhances their reputation among peers as capable check writers.
Some scouts will undoubtedly lament the termination of Sequoia’s program. Station F founder Roxanne Varza, for instance, expressed sadness on LinkedIn, stating she “hope[d] that other funds won’t follow suit.”
Varza, a former Sequoia scout from 2020 to 2025, told TechCrunch that she possessed no additional information beyond what has been publicly disclosed, yet noted that serving as a scout frequently serves as a stepping stone for aspiring investment managers.
“I cannot name every remarkable scout who has gone on to join or launch funds, but there are many. The scout programs have likely facilitated that progression—enabling the development of an investment track record and fostering direct relationships with various funds,” she told TechCrunch.
Varza contended that the program’s influence extended beyond individuals, contributing to a more mature ecosystem. “I believe they have helped cultivate the investment culture and early‑stage landscape evident in Europe today,” she said.
Although some may concur with Varza regarding the contributions of these programs, they may still have reached the end of their usefulness for two reasons. First, experienced operators can achieve greater financial upside as angel investors, retaining full returns when using their own capital. Second, leading venture firms are now sizable and well‑known, attracting top founders and reducing concerns about missing deals, except at the earliest stages or in niche markets and regions with limited reach.
Nevertheless, the appeal of early and niche opportunities makes scout programs more prone to restructuring than complete dissolution. “Even though Sequoia may be ending this program, venture partner‑style deals are likely to persist,” Varza wrote in an email to TechCrunch. “Scouts served only to scale the model. I don’t expect Sequoia to eliminate all forms of venture partnership, but they are full of surprises.”
