The Sequoia fund – Embracing evergreen fund structure

The Sequoia fund – Embracing the evergreen fund structure

The private markets are constantly evolving. This is highlighted by Sequoia’s seismic announcement this week that they are completely revamping their fund structure, ditching the 10-year close-ended vehicle that has long been the industry standard in favour of the evergreen model – i.e an ongoing structure without a fixed end date.

“Over the past few years, we’ve observed a growing trend of fund managers adopting evergreen structures with longer holding periods beyond the traditional 10-year fund cycle.” says Sun Suriyapatanapong, Co-Founder and Partner at Quantium. “I’m pleased to announce that Quantium now supports evergreen fund structure as part of our fund management solution.” 

The evergreen fund structure is not a new concept, but is less commonplace than the traditional 10-year cycle. The open-ended nature of the evergreen fund structure comes with its own administrative challenges in LP management, accounting treatments, carried interest calculation and investment performance analysis – for example, portfolio and LP returns become more complex to track as investors enter at different cycles and valuations. 

Whether you manage your funds in house or outsource to a fund administrator, Quantium’s tech stack simplifies evergreen fund management so your data is well organized and easily accessible at any time.

“The Quantium team works closely with many pioneers in the private markets industry and we turn these insights and best practices into intuitive technology solutions,” says Sun.

“Innovation is in our DNA because we recognize the industry will evolve rapidly in the next decade. We are excited to support LP and GP clients in leading these changes and staying ahead of the curve.”

With Sequoia embracing the evergreen fund structure, other market players may follow suit in considering different approaches, putting more thought into selecting fund structures that suit their own objectives as well as the goals of their investors. It’s important that service providers and technology partners are ready to evolve alongside them.

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