Sequoia’s Shaun Maguire on competition and conviction in crypto venture — ‘A lot of VCs… are going to pull back’

With a rising crop of native venture funds that are seeing their assets balloon and their influence upend the traditional venture hierarchy, storied venture firm Sequoia is not just competing with the a16z, but with a rising crop of native venture funds that are seeing their assets balloon and their influence upend In a conversation on the new web3 show Chain Reaction, the partner of Sequoia talked about the firm's commitment to the sector, regulatory challenges and what many investors still don't understand.

The sub-fund was dedicated to buying up cryptocurrencies. Over the years, the firm has made a number of equity investments in the space, including Fireblocks and FTX, but it has not made a dedicated fund for it.

The cooling of public market tech stocks has threatened to stall growth in the emerging category, which has still proven susceptible to macro conditions. When the market grows less frothy, many other funds will pull back, but he believes that Sequoia has already committed to a lengthy relationship with the sector.

quoia is very deliberate with everything we do and we spend huge amounts of time debating every strategy change, everything, we debate every seed investment to sometimes excruciating detail, but it helps us make really good decisions and make decisions as a team rather than as individuals. Over the last 18 months, we went from being some people with strong positive views, to the whole firm being completely behind it.

Why a bipartisan embrace of crypto might never touch Bitcoin

Some in the venture capital community believe that the benefits of the sector are being oversold and that the web3 promise of decentralization is just smoke and mirrors.

There are a lot of things that are not understood by the average person. You want the majority of compute to be centralized. For a lot of decision making, centralization can be better.

The ability of users to be able to leave with their identity and data is more important than decentralization for its own sake. The rulebook of traditional investor protections shouldn't be thrown out, despite the fact that decentralization allows for a certain type of consumer protections.

A lot of the consumer protections put in place by US law were won out of hard-fought lessons over a century. There is a lot of wisdom in there. The way things were done in the past was actually pretty good and got there for an optimal reason.

You can listen to the entire interview on Chain Reaction. You can subscribe to Chain Reaction on Apple, or one of the other alternatives.

Please don’t YOLO your 401(k) into shitcoins