Illustration: Aïda Amer/Axios

Sequoia Capital issued a dire warning Thursday to portfolio company CEOs about the business impacts of the coronavirus, suggesting that they "question every assumption" about their businesses, including cash runway, headcount, sales forecasts, and the availability of future funding.

Why it matters: Sequoia, an early investor in Airbnb and Google, is no Chicken Little. The last time it did something similar was more than 11 years ago, at the peak of the financial crisis, via its famed "RIP Good Times" slide deck.

Sequoia partner Roelof Botha tells me that the firm's goal is to "sensitize" companies to the potential for compounded risks, something that most people don't intuitively contemplate. He adds that Sequoia isn't recommending layoffs or hiring freezes, but does believe that companies should "become more deliberate about decisions you might otherwise make casually."

Why now? Botha recalls being CFO of PayPal in mid-2000s, when Sequoia partner Michael Moritz raised alarms during a board meeting about the rapidly dehydrating funding environment.

"He told us we needed to focus on cash runway immediately, and suddenly we're wondering if we'll ever be able to raise money again. Man, did that cause us to get our stuff together quickly. It was the same for companies in 2008. This time we might only be helping buy companies two or three or four weeks instead of six months, but it's better than doing so once it's already too late."

Botha does not currently expect portfolio companies to fail due to the economic fallout from coronavirus — believing it was a more present danger in 2008/2009 — although Sequoia's memo does note how some companies have seen sharp growth rate decreases and are now at risk of missing their first quarter projections.

Sequoia is also making some changes of its own. The global firm had already relocated its annual limited partner meeting from India to Silicon Valley, but now has decided to do it virtually.

  • It also is curtailing international travel (albeit not banning it entirely), and also cutting back on domestic trips. Sequoia's U.S. offices remain open for now, but Botha believes that the "Bay Area is at risk of people being asked to work from home if they can."

The bottom line: Sequoia is saying publicly what many investment firms have been telling CEOs privately: It's now prudent to prepare for the worst.

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Updated 2 hours ago - Politics & Policy

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Illustration: Aïda Amer/Axios

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  4. Health: FDA approves Gilead's remdesivir as a coronavirus treatment How the pandemic might endMany U.S. deaths were avoidable.
  5. Education: Boston and Chicago send students back home for online learning.
  6. World: Spain and France exceed 1 million cases.

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Americans have cast more than 47.1 million ballots in the 2020 presidential election, surpassing the total early-vote count for 2016 with 12 days left until Election Day, according to a Washington Post analysis of voting data.

Why it matters: The election is already underway, as many states have expanded early and mail-in voting options because of the coronavirus pandemic.

What to expect from the final debate of the 2020 election

Trump and Biden at the first debate. Morry Gash-Pool/Getty Image

Watch for President Trump to address Joe Biden as “the big guy” or “the chairman” at tonight's debate as a way of dramatizing the Hunter Biden emails. Hunter's former business partner Tony Bobulinski is expected to be a Trump debate guest.

The big picture: Trump's advisers universally view the first debate as a catastrophe — evidenced by a sharp plunge in Trump’s public and (more convincingly for them) private polling immediately following the debate.

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