Sequoia’s departure from London raises a bigger question about Europe’s ability to build, finance and retain globally dominant technology businesses.
Sequoia Capital has closed its London office, explaining that it no longer sees the need for a local presence. For one of Silicon Valley’s most influential venture capital firms, this is a strategic decision. For Europe, it should prompt a bigger question: are we creating globally dominant technology businesses, or simply building successful startups?
The timing is striking. UK startups raised $23.7bn in venture capital in 2025, up 33 per cent on the previous year, with London accounting for almost three-quarters of that investment. Yet Sequoia believes it can identify and support Europe’s next generation of technology leaders from the other side of the Atlantic.
This is about more than reallocating capital. It is about reallocating attention, increasingly the scarcest resource in the global technology economy.
The end of proximity as a competitive advantage
Historically, having international investors physically present in London signalled commitment, enabled relationships and provided closer involvement in company development.
But technology has changed the geography of investment. Global networks and connected founder communities mean capital can operate remotely.
The question is no longer whether Silicon Valley needs an office in Europe. It is whether European companies are becoming sufficiently compelling that global investors cannot afford to ignore them.
Europe’s real challenge is category leadership
We often measure technology success through funding rounds, unicorn valuations and startup formation. These are useful indicators, but not the ultimate measure.
The real test is whether Europe can consistently create businesses that define, dominate and own global market categories.
There is a fundamental difference between a successful company and a category champion. The former competes in an established market; the latter changes how that market is understood and becomes its reference point.
Europe has produced impressive international businesses, including Spotify, Adyen, ASML, SAP and Wise. But the challenge is making this success repeatable across AI, enterprise software, fintech, cybersecurity, industrial technology and deep tech.
Europe has the talent, research institutions and engineering capabilities. What it needs is a stronger combination of capital, commercial ambition, category creation and international scaling expertise.
From promising startups to global leaders
Foreign capital accounted for approximately 74 per cent of UK venture funding in 2025. International investment is essential, but dependence on overseas investors for funding, strategic validation and access to global markets creates vulnerabilities.
The danger is that Europe becomes an excellent place to establish a company and develop technology, but a less compelling place to build and retain a global category leader.
Having advised on technology M&A and corporate strategy for more than four decades, I have seen what distinguishes enduring market leaders. They understand they are not simply selling products or competing for market share. They are creating and defining markets in which they intend to lead.
This is category design. It requires distinctive positioning, defensible intellectual property, strategic partnerships and the ability to use M&A to accelerate competitive advantage.
For technology businesses approaching the $10m-$100m revenue stage, this is particularly important. Having achieved product-market fit, the next question is no longer simply how to grow revenue, but how to become the company that defines the category.
That means thinking internationally, attracting world-class management and building strategic capabilities for long-term growth.
Who will back Europe’s next generation?
Europe needs investors willing to support ambitious companies throughout the journey from startup to global market leader. It needs stronger connections between venture capital, private equity, corporate investment and strategic M&A.
Most importantly, founders must think beyond building successful European businesses. The ambition should be to create global category leaders here, not simply businesses that eventually become attractive to US acquirers.
Funding is an enabler, not a strategy. Valuation is an outcome, not a measure of sustainable competitive advantage.
Sequoia’s departure is not a verdict on London or European technology. It is a wake-up call.
The real test is whether Europe can create, finance and retain globally dominant businesses.
Sequoia may no longer need a London office. But Europe needs to ensure the next Sequoia-scale investment opportunity is being built here.
The question is not whether Silicon Valley will invest in Europe. It is whether we can build businesses so strategically important that global capital has no choice but to come to us.