In recent years, assets under management at investment firm Tiger Global have exploded. Now the company is evaluating and liquidating its operations, according to a new investor letter first view Powered by Axios and later acquired by TechCrunch.
More importantly, whether due to a lack of other options or – as is likely – in reaction to the changing market landscape, the company has informed its limited partners that it plans to raise $6 billion for its newest fund, which it expects to maintain at least the “first close” by mid-March. The month of January. (As an additional sweetener, investors on the first close will receive a reduced management fee of 1.75%, depending on the character.)
While still plenty of money, the $6 billion is less than half of the $12.7 billion Tiger Global received from investors in March of this year, money it began investing last fall and rip quickly. (A source familiar with the company says it is still investing from that car.)
The capital that Tiger Global employees will commit to the new fund has also shrunk. While employees contributed $1.5 billion to the $12.7 billion Tiger Fund, or 12% of the total amount, this time they are committed to investing at least $500 million for the $6 billion effort, or just under 9% of the amount. Total. (This may go up.)
The company suggests that what doesn’t get smaller is the Tiger Global seat size. While Many I was made On Monday, a source familiar with the company said, following the departure of John Curtius, a software investor who joined Tiger Global in 2017, Tiger Global has a slightly larger team than it had at the beginning of this year. In fact, in its investor letter released Monday as well, Tiger Global stated that it had recently hired five new investors, including two Blackstone people, two recent Harvard graduates, and a fifth investor, Evan Stanleigh, who joined the company after seven — the year that I spent it as a partner with the New York hedge fund Cadian Capital.
Notable: A source familiar with the company says that no one has voluntarily left Tiger Global this year, in an apparent reference to Curtius, who has dubbedstar partnerby Fortune who was part of an eight-person unit focused on software investment and reporting to company founders Chase Coleman and Scott Schleifer. (This source declined to go into further detail; meanwhile, sources close to Curtius say he has since wanted A long time ago setting up his own company and felt it was the right time in the market to do so.)
Either way, the low-flying Tiger Global didn’t seem to like the attention Curtius attracted as he walked out the door. He confirmed to The Information today that previously reported plans for him to stay with the 160-person uniform through June have changed and that he has already left. “Tiger will do amazingly well and I am very excited about my next project,” Curtius He said to the outlet.
Tiger’s latest fund is its 15th, although it is titled Tiger Global Private Investment Partners XVI. (The costume was a bit superstitious when it hit box 13, so it skipped a number one forward.)
Fundraising for a car will not be as easy as in recent years for sure. The market has changed drastically since the team was last on the market, and Tiger Global in particular was hit hard in the market downturn, due to its aggressive investment strategy that made it write huge checks at technology companies that, in many cases, were lower. value than it was before.
Hobin, for example, a struggling young virtual event company backed by Tiger, is supposed to be appreciated Not close at all The $7.8 billion that investors deemed due during the pandemic.
Of course, like many investors who have a bad time with it, Tiger Global points to its historical returns and states in its new investor note that since its inception in 2003, it has recalled $36 billion in funds and distributed $30 billion (about $8) billion of it It flowed to its investors only in the past two years, says a source close to the company).
Tiger Global also says in that letter that it has a 34% TIR and a 24% NIR dating back to its early days. (The net internal rate of return is down just 1% from earlier this year, according to an investor note obtained by TechCrunch earlier this year, even while one might guess it would be more under current market conditions.)
Tiger Global also says its remaining portfolio represents $45 billion in fair value, thanks in large part to still-private internet companies like ByteDance, Shein, Stripe and Razorpay.
The question is whether these stakes are enough to convince investors who are currently tied up in capital. They have reason to feel less confident in Tiger Global’s investment prowess, the company itself readily admits. “This is not the year our scoreboard will make us proud,” the company said in its investor letter released Monday. “[W]We have a lot of work to do to recover recent losses.”
As always, Tiger Global will also have plenty of competitors to compete with, including, now, the company Curtius is said to be creating. Dubbed Cedar Investment Management, it is expected to compete for early-stage deals with Tiger, whose average investment size has, once, fallen astonishingly low to $30 million over the past year, the company says in an investor letter.