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News and Press Releases |
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HEADLINE:
UCLA Ejected From Sequoia's VC Funds
By: Richard Waters
FinancialTimes.com. August 28, 2003
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EXCERPT: The backlash from Silicon Valley's top venture capitalists over pressure to have their investment results publicised has claimed its biggest victim. The University of California, which manages $34bn of investments, has been ejected from venture capital funds run by Sequoia Capital, one of the Valley's most consistently successful investment firms. The move will end a relationship that has earned the university investment profits of nearly $400m. It is the most abrupt reaction yet to the growing pressure on the secretive venture capital industry to let its results be judged publicly. State university and other public pension funds in the US have faced an increasing number of legal challenges aimed at forcing them to disclose the details of venture capital investments. In the University of California's case, a judge last month agreed with an application by the Coalition of University Employees and the San Jose Mercury News that the information had to be disclosed under the state's public records act. The university resisted the claim, arguing that publication would harm its investment returns since it would be shut out of high-flying funds that wanted their performance to remain secret. The university revealed on Wednesday that Sequoia, whose investment successes have ranged from Cisco Systems and Yahoo to Google, had ejected it from its existing venture funds. "It is not in the interests of Sequoia Capital's other clients that we be hounded, badgered and stalked by entities wishing to either profit from or publicise our private and confidential information," Mike Moritz, a Sequoia partner, wrote to the fund. The university said it had invested $110m in Sequoia's funds and received back more than $508m. Alternative investments that could replace this relationship "are simply not available", the university said in a court filing this week.
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