Sequoia Capital, one of the most prominent Silicon Valley venture capital firms, is mulling a set of sweeping changes to the way it distributes investment returns, a move that couldĀ help it avoid tax increases proposed by the Biden administration, according to people familiar with the matter. Read the article about Sources sequoia bidenmcbridebloomberg.
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Sequoia, which backs privately held companies, has asked its investors to agree to two key changes, said the people, who asked not to be identified discussing private information. First, Sequoia would make an early, pre-initial public offering distribution of some shares in portfolio companies, rather than waiting until after an IPO. Second, instead of distributing the shares directly to its general partners, Sequoia would hold the shares in a special purpose vehicle; no immediate payout would be made.
