On May 4 of 2012 Pando reports:
The structure isn’t exactly like a standard limited partner arrangement, because the bulk of the returns go to the scout, not the firm. Exactly what benefit Sequoia gets out of it remains unclear. I asked all three scouts if their deals would have likely pitched Sequoia eventually anyway, and most of them said yes. Sequoia doesn’t get any warrants or right of first refusal or equity in the company.
It’s been over 3 years since this was report. I’m amazed most entrepreneurs don’t know this.