Our History

Sequoia Fund is a concentrated, long-only equity fund that invests primarily in domestic mid- and large-capitalization companies. We aim to own a focused portfolio of quality businesses run by competent people, assembled through a process grounded in intensive primary research. We try to accumulate stakes in our companies at prices that understate what a conservative businessperson would reasonably pay for them, and we hold our investments over a long horizon with the mindset of a private owner. At the core of our strategy is a belief that if we pay attractive prices to own attractive businesses, our portfolios should earn excess returns with limited fundamental risk.

We think investing with an unusually long-term perspective allows us to focus on things we can understand. Over months and quarters, stock prices fluctuate with the ups and downs of the market, driven by sentiment, politics and other macro-level forces that we think are hard to predict. Over years, stock prices reflect profits and business progress, driven by factors like business quality, management competence and industry dynamics that we think are understandable more often than not, if researched thoughtfully and extensively.

We are keenly sensitive to false-precision risk. We don’t believe in target prices. We know that value exists within a range, and is hard for even a thoughtful analyst to pinpoint. We are also sensitive to reinvestment risk. Great companies at good prices are hard to find. If we sold them every time they reached fair value, we could struggle to find replacements. Then there is expense risk. Trading and taxes create real costs with real consequences, even if they’re not immediately apparent in headline returns. Our long-term view means that business results should drive our returns to a greater degree than changes in valuation. As such, we have a low inclination to trade.

Reading company filings and crunching numbers is just the start of our process. We take pride and pleasure in investigating a company from all angles, and we devote most of our time to the kind of ground-level, primary research that an enterprising journalist might do. This work can be painstaking, spanning months and sometimes years, but it often yields surprising and valuable insights – some of which can be entered into a spreadsheet, but many of which cannot.

We don’t believe in titles. Each of our investment professionals is an analyst, and we all do primary research. We enjoy learning and discussing what makes businesses tick, and we try to provide a great home for curious people who are passionate about fundamental research. We believe the best investing judgments come from an environment where a diverse mix of backgrounds and perspectives contributes to an open-minded, inclusive and rigorous internal debate, guided by a common set of value investing principles. Our team has analyzed thousands of companies over decades, accumulating a research database and associated institutional memory that represents one of our most valuable assets.