Sequoia Capital will be splitting into three regional investment firms in the beginning of 2024. The three companies will be Sequoia Capital for US/Europe, HongShan (China) and Peak XV Partners (India and Southeast Asia). Some background in Forbes.
Splitting up is going in the opposite direction of consolidation, which is what Christian Sinding, CEO of EQT, told Bloomberg (as reported by DI.se) that he sees coming among alternative asset and private equity managers (which is much broader than venture capital).
Larger venture funds allow pension funds and other institutional investors to invest larger amounts of capital, which is valuable/useful and could be a driver of consolidation. Even after splitting up Sequoia Capital and HongShan and Peak XV Partners will be major players in their respective geography.
However, in venture capital there are diseconomies of scale, especially for early-stage investing. There are limits to how much money can be invested at seed and Series A. Therefore the best performing funds historically, when measuring profit in the number of times capital is returned, have been quite small in the $50 million to $300 million size range. Like Earlybird Digital East Fund I at $150 million with a 24.9x return (as of 2020) and Creandum II at ca 70 MUSD with a 13x return (as of 2019).