Tiger Global, which is one of the winners in the technology market has shared its plans of slowing down its speed for investments in the industry start-ups for the next two quarters, the latest in the line of prominent investors concerned over the fact that the market is going down. Headquartered in New York, the firm has invested in 361 deals in the year 2021, and currently, it is investigating the conditions of the market so it can plan and limit the number of new capitals to be invested till December, according to Alex Cook, the partner of Tiger Global.
On his visit to Bangalore, Cook met some of the founders at the beginning of the month to discuss the assuaging market concerns and the recent performance of the company. He also mentioned that Tiger Global will continue to support the start-ups with the best internet and technology. The firm currently is looking for opportunities to raise fresh funding this year.
Barring any possible public market drops and recession, it will ideally take another quarter or two to reach a new stable start-up market valuation.
According to the reports, managing a total value of over $20 billion, Tiger Global benefitted from the increase in share prices of companies like Zoom, which are tech-enabled and were used widely during the pandemic. Despite that, the company faced two-thirds losses of its total gains of the stock funds since the year 2001, when the company was founded. Cook told the founders that it is too soon to give an idea about the value that Tiger Global will be able to collect for the larger fund of the company. Most investors in the world are scrambling to evaluate the crash in the stock market, which has adversely reversed so many gains in the 13-year bull run. This is also the reason for the halt in the new investments.
According to some records, the move by Tiger Global is a significant one as it has backed more companies with funding than other investors in the US the previous year. With slashing the valuations for private companies in the tech sector along with emerging markets, investors across the world have become more selective in the past few months. Indian start-ups raised $6.9 billion in the recent quarter that ended in June, which has come down from the raise of $10.3 billion during the January to March quarter this year.
According to some investors as a caution, there are chances that the tech stocks might see a further fall resulting in more painful days for the start-ups. The start-ups are suffering from the tightening of valuations, especially the companies that are in their Series A and Seed funding. With this situation in the market, things have only moderately grown for older companies. The number of series seed rounds has decreased somewhat, although as more series Investor demand for each round to be 2-3X the valuation of the previous round causes a harsher reprice. Private tech is in a position where public tech was at the beginning of 2022 for some stages.
Tiger Global is currently looking for opportunities to raise fresh funding this year.
Barring any possible public market drops and recession, it will ideally take another quarter or two to reach a new stable start-up market valuation. Things like these take time to fully grow to all stages, investors, and founders as well. Known best for investing in late-stage and growth start-ups, several changes were made by Tiger Global for its strategies in the year 2020 and resulted in over six dozen investments in deals that were at an early age. The investors showing more interest in signing Seed and Series A deals have been publicly criticized by some investors, worrying about whether the funds invested will keep supporting the newer and younger companies whenever there is a change in the market. cook also told the founders that the firm is hopeful of supporting the early-stage start-ups and will continue to support such deals in the market in near future.