What happened: Sequoia Capital China—the Chinese arm of the Silicon Valley venture capitalist—is set to lay off as much as 20% of investment staff, according to a report from Reuters citing two people with knowledge of the matter. The number of venture investment professionals could be cut from about 70 currently. The job cuts began in late March and have mainly affected the venture capital arm’s technology and media, healthcare, consumer, and industrial technology teams, said the two people who declined to be identified.
Sequoia China has been quick to deny the claims, saying it regularly reviews its workforce which may result in adjustments to personnel. The company added that 13 new investment professionals joined the company within the last year.
Why it’s important: The news comes amid a broader downturn in China’s tech sector in recent months. Several major tech companies have announced restructuring or layoffs, including e-commerce giant JD.com, super app Meituan-Dianping, and ride-hailing app Didi. If accurate, the workforce reduction at Sequoia China would be especially telling given the company’s high standing in the tech sector, which led Reuters to characterize it as “a bellwether for Chinese tech investment.”