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A new disclosure shows, again, how badly Tiger’s ‘pray and spray’ fund performed | TechCrunch

Dec 10, 2024 - techcrunch.com
Tiger Global's aggressive investment strategy during the pandemic-era venture capital boom led to significant challenges as market conditions shifted. In 2021, the firm invested heavily in startups, raising $12.7 billion for its fifteenth venture fund, PIP 15. However, as interest rates rose in 2022, startup valuations dropped, resulting in substantial paper losses for the fund. By mid-2024, PIP 15's losses exceeded 15%, placing it in the bottom 10% of venture funds from that period. Other funds from the same era, such as those from Valor Equity Partners and OakHC/FT, have shown better performance. Tiger Global's rapid investment approach and the subsequent downturn have left a lasting impact on its reputation.

Despite these setbacks, Tiger Global continues to participate in venture capital deals, albeit with a reduced war chest. The firm struggled to raise its sixteenth fund, closing with only $2.2 billion in commitments, far short of its initial $6 billion target. Leadership changes have also occurred, with key figures like John Curtius and Scott Shleifer stepping back from their roles. As Tiger Global navigates the aftermath of its pandemic-era investments, it remains to be seen how the firm will adapt and recover in the evolving venture capital landscape.

Key takeaways:

  • Tiger Global's aggressive investment strategy during the pandemic led to high valuations, but the firm faced significant losses as interest rates rose and valuations dropped.
  • The firm's fifteenth venture fund, PIP 15, reported paper losses of over 15% as of June 30, 2024, placing it in the bottom 10% of venture funds raised in 2021.
  • Other funds from the same era, such as those from Valor Equity Partners and OakHC/FT, have shown better performance, with positive returns.
  • Tiger Global struggled to raise capital for its sixteenth fund, closing with $2.2 billion, significantly less than its initial target, and some key personnel have since left or transitioned to different roles.
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