Sequoia Capital is reportedly in early discussions to raise a $5 billion venture fund. People close on the matter have said that the fund, which is likely to be twice the size of the previous fund, will be to defend the Silicon Valley firm against foreign investors as well as enabling their startups to remain private enterprises for as long as they would like.

The firm would almost exclusively invest in technology startups which are already a part of Sequoia Capital’s portfolio, people close to the matter have stated to Bloomberg News, under the condition anonymity. Furthermore, if Sequoia Capital is able to garner enough interest, it will begin investing from the firm in the second quarter of 2018, they added.

Sequoia Capital is aiming to capitalise on tech companies staying private longer. In addition to funding companies directly, the firm is also looking to amass larger stakes in its chosen startups by purchasing holdings in the companies from entrepreneurs and early employees. This tactic has been frequently employed by the Japanese company, SoftBank Group Corp, which has recently been offering billions of dollars for shares in Uber Technologies Inc.

In recent times, the venture funds of top firms have shown great growth. However the $5 billion target is a big step for Sequoia. If successful, it will be the largest fund of any venture capital firm, even exceeding the $3.3 billion which had been raised by New Enterprise Associates earlier this year.

Although SoftBank is not a venture capital firm, it has been changing the venture capital scene in Silicon Valley. Since raising a $100 million fund with Saudi Arabia, SoftBank has bought holding in some of the top names in the US techno scene including Slack Technologies Inc and WeWork. “Because of SoftBank’s deep pockets , an investment from the firm often changes the power dynamic in the company, said TrueBridge Capital co-founder Edwin Poston, an investor in prominent venture firms like Sequoia Capital , Accel , Andreessen Horowitz and Peter Thiel’s Founders Fund. “But many entrepreneurs can’t resist an approach from SoftBank because it generally comes at a high share price” he added. “It’s cheaper money.” Investors are now trying to find their place in a fast changing industry. “The risk that the public markets would take is now taken by VCs. It’s a new world,” Poston said.

(Picture courtesy: Studio Scott)