At TechCrunch Disrupt 2025, Sequoia managing companion Roelof Botha argued that the enterprise trade isn’t an asset class, and that throwing more cash into Silicon Valley doesn’t result in higher corporations.

“Investing in enterprise is a return-free threat,” Botha mentioned throughout an interview on TechCrunch’s Disrupt’s primary stage on Monday. “Anyone who’s studied the capital asset pricing mannequin understands the joke of that. The rationale I got here up with that is, when you have a look at the historical past of enterprise capital, it’s an asset that’s uncorrelated with different asset lessons.”

“And so the considering for a lot of allocators was you need to allocate a sure share of your portfolio to this and more cash ought to move to enterprise capital, however the reality is that there are solely so many corporations that matter,” Botha continued.

“For my part, throwing more cash into Silicon Valley doesn’t yield extra nice corporations. It really dilutes that, it really makes it tougher for us to get that small variety of particular corporations to flourish,” added Botha.

Botha famous that there are at present 3,000 enterprise corporations in america, whereas there have been simply 1,000 when he joined Sequoia 20 years in the past.

“After I joined Sequoia 2003 there have been no cellular gadgets,” mentioned Botha “Cloud computing didn’t exist. There have been possibly 300 million folks on the planet that had entry to the web. So the dimensions of the chance at this time is totally completely different. If you happen to look technically on the numbers, I believe for the final 20 years, there’s roughly been $380 billion+ outcomes within the trade,” Botha mentioned.

“That’s a major quantity, however I don’t assume it’ll proceed to scale simply with more cash going into the trade.”