Sequoia’s Shaun Maguire Urges Focus on Specialty Chemicals NOW
UPDATE: In a striking revelation, Shaun Maguire, partner at Sequoia Capital, has declared the specialty chemicals industry as one of the most underrated sectors today. Speaking on the “Relentless” podcast aired on November 17, 2025, Maguire emphasized that the niche chemicals segment is essential for numerous companies, yet remains largely overlooked.
Maguire stated, “The chemicals industry is one of the most underrated industries in the world for many reasons.” He pointed out that while the overall chemicals sector is currently experiencing a downturn, with production volumes predicted to contract by 0.2% next year, specialty chemicals represent a promising opportunity. According to a 2022 report from the Cybersecurity and Infrastructure Security Agency, specialty chemicals account for about 23% of the entire chemicals industry.
He explained that many individuals view the chemicals industry merely as a commodity market, failing to grasp that “at least 25%” of it consists of rare specialty chemicals. These unique substances are often produced by only one company worldwide, making their availability critical for various manufacturing processes.
Maguire highlighted the risks associated with losing access to these essential chemicals, particularly citing their significance in one of Elon Musk’s ventures. “Losing access to a key chemical can severely delay or upend projects,” he warned. Specialty chemicals include vital components such as adhesives, sealants, flavors, fragrances, food additives, and even explosives.
Currently, the chemical sector is lagging behind the broader market. As of last Thursday, the S&P 500 Chemical Industry index was down 5% for the year, while the overall S&P 500 had surged more than 11%. Despite the challenges, the specialty chemicals market is expected to earn higher margins, as noted in Deloitte’s 2026 Chemical Industry Outlook. The report reveals that while basic chemicals face overcapacity and fierce competition, specialty chemicals tend to evade such commoditization.
As the construction, automotive, and consumer goods sectors continue to struggle, the semiconductor market—bolstered by AI data centers—may offer a silver lining for specialty chemicals, according to Deloitte. The industry is at a pivotal juncture, and experts suggest that increased attention to specialty chemicals could yield significant rewards.
With the chemicals industry in a precarious position, now is the time for investors and companies to recognize the potential of specialty chemicals. As Shaun Maguire aptly puts it, the focus must shift immediately to this vital yet underrated sector.
Stay tuned for ongoing updates as this story develops, and consider the implications of this critical insight for the future of various industries reliant on specialty chemicals.
