Source: TechCrunch
Sequoia's decision to shut down Scouts—the 15-year-old program that let operators and founders invest small checks on behalf of the firm—reflects a shift in how top-tier VCs source deals. The program was widely copied because it solved a real problem: giving Sequoia pattern-matching advantages through people embedded in networks (it led to Uber, Stripe, and Airbnb investments). But those advantages apparently no longer justify the operational overhead or diluted carry at scale. The retreat from distributed deal-finding reflects the firm's broader contraction. Large VCs are consolidating around mega-round capital deployment rather than competing for access at the earliest stages. This leaves opportunity for smaller, network-dense firms willing to operate closer to founders.