Tiger Global's Venture Arm Faces Setback with 18% Paper Loss

Tiger Global Management, prominent in the field of venture capital, has recently experienced a setback with its largest venture fund reporting an 18% drop in paper value as the fiscal period closed at the end of September.

This downturn is primarily attributed to the firm's reassessment and subsequent downgrade of a number of their portfolio company's valuations, as detailed by inside sources.

The venture fund in question, known as the Private Investment Partners 15 (PIP 15), had a valuation nearing $13 billion before witnessing significant markdowns. Noteworthy among these was the 45% devaluation of Superhuman, a company specializing in artificial intelligence (AI), as well as a substantial 72% decrease in the valuation for the privacy-centric search engine DuckDuckGo.

Other remarkable valuation adjustments include a 69% markdown for the popular NFT series Bored Ape Yacht Club, and an even more striking 94% reduction for the NFT marketplace OpenSea.

These markdowns reflect the sharp decline in value from the point of Tiger Global's initial investment in the aforementioned companies.

Tiger Global is a heavyweight in asset management with an approximate $50 billion under its stewardship.

The venture capital sector is contending with a difficult phase as startup companies face tighter budgets in an economy dealing with increased interest rates.

In events mirroring Tiger Global's strategy, Philippe Laffont's Coatue Management also took a drastic step by slashing its valuation of OpenSea by 90% and readjusting its involvement with other businesses including Calendly and Notion.

A major shake-up within Tiger Global was also communicated to its investors recently, with Scott Shleifer stepping back from his role as head of the venture capital division to serve as a senior advisor, whilst maintaining his partnership status, effective from January 1. His need to be with his family in Florida was cited as a driving factor for his decision.

Last year marked a tough period for the company as well, with Tiger Global cutting the valuations of its venture funds by about 33%, leading to a consequential $23 billion plummet in overall value.

The episode concludes with the final closure of the PIP 15 fund taking place at the early part of the preceding year.

TigerGlobal, VentureCapital, Losses