Over the weekend, TechCrunch briefly published and then deleted a post called “Is Sequoia China in Trouble?”
The post was written by Sarah Lacy, who is travelling the world for a new book. In it, she discussed venture capital firm Sequoia Capital’s “so-called ‘China Problem’.”
TechCrunch has now re-published the post with some key changes to the text. Most of the changes regard allegations about one of Sequoia China’s founding partners, Zhang Fan, who resigned due to “personal reasons” in February.
In her original post, Sarah said she “talked to close to 20 sources in the venture scene in Beijing and Shanghai who say those ‘reasons’ were that Zhang was well known for taking bribes, kickbacks and other unethical behaviour.” This sentence has been removed from the updated post.
The new post notes, “I’ve updated this story based on conversations with additional sources.” It’s hard to imagine what the new sources added that refuted the info provided by the original 20. Was Zhang not, in fact, well known for taking bribes, kickbacks, and other unethical behaviour? We asked Sarah, TechCrunch, and Sequoia for comment, but we haven’t heard anything.
Here’s an excerpt from the original post:
Now, it seems it’s Sequoia’s turn for some humble China pie.
It’s no secret Mike Mortiz [sic] has been travelling back-and-forth to China a great deal, and he’s fond of telling reporters that’s because of all the opportunity. I asked him at Kenshoo’s recent US launch party about the unique challenges of investing in China versus the US, Europe or Israel. He said he wasn’t trying to stonewall on the answer, but that all venture investing was just hard, no one place more than another.
Really? Several sources in China and Silicon Valley have confirmed Moritz has been in China this week addressing Sequoia’s so-called “China Problem.” In February, one of Sequoia China’s founding partners, Zhang Fan, resigned due to “personal reasons.” I’ve now talked to close to 20 sources in the venture scene in Beijing and Shanghai who say those “reasons” were that Zhang was well known for taking bribes, kickbacks and other unethical behaviour. People are fond of pointing out that Zhang’s biggest hit was Asia Media Company, which later had to de-list from the Tokyo Stock Exchange under a scandal. Whether it’s true or not, he certainly didn’t do Sequoia’s brand any favours here.