The Troubled Investments VC Firms Tried to Erase — The Information

There’s no better way to avoid flack for a slew of bad venture capital investments than simply erasing evidence of those deals—right? That’s apparently what a handful of VC partners decided in 2022, a year many will remember for the collapse in startup valuations and several unforgettable blow-ups.

In between marking down the value of their startup bets, firms like Sequoia Capital and Index Ventures also took down embarrassing references to their very worst investments: FTX, the now bankrupt cryptocurrency exchange once championed by Sequoia, and Fast, the since-defunct one-click checkout startup backed by Index. 

But perhaps the most egregious example of investors trying to remove traces of mistakes belongs to Laurence Tosi, founder and managing partner of investment firm WestCap Group and Airbnb’s former chief financial officer. The week of July 13, when I went to look at WestCap Group’s investments, I noticed the website no longer showed its portfolio of startup investments. The same week, WestCap-backed crypto lender Celsius Network filed for chapter 11 bankruptcy protection, and Klarna, also a WestCap portfolio company, raised new funding at a $6.7 billion valuation, an 85% retreat from its last valuation of $46 billion.