The famed Tiger hedge fund crowd may be losing its cachet.
Despite posting strong gains in 2023, several of the most high-profile firms continued to see their total assets decline last year, or at a slower rate than their recent performance would indicate. What’s more, most of these firms’ year-end 2023 assets under management were sharply lower than just two years earlier. This suggests investors are no longer giving firms extra consideration because of their Tiger Management roots.
The most glaring example is Tiger Global Management, which has both a hedge fund arm and a previously very active venture capital business, which it calls private equity. The firm reported $46 billion in assets at year-end, according to a regulatory filing. This is down from $51 billion the year before and $86 billion at the end of 2021, when it was clearly the largest of the descendants of Julian Robertson Jr.’s hedge fund firm.
Last year’s decline is especially surprising given the performance of Tiger Global’s hedge funds. In 2023, the long-short fund gained 28.5 percent and the long-only fund rose 20.4 percent. Of course, this came after the long-short fund lost 56 percent in 2022 and 7 percent in 2021 and the long-only fund dropped 67 percent in 2022.
Assets likely declined last year in part because the firm had redemptions at the same time the two funds remain closed to new investors. The bulk of the reduction is on the private side, however. Last year, Tiger Global had several big investment realizations across its PE business, including Indian e-commerce company Flipkart. This enabled the firm to make significant distributions to its limited partners.
The firm also called very little new capital last year even as it had markdowns in the valuations of a number of private holdings, along with the venture capital industry in general. And Institutional Investor has previously reported that Tiger Global has been much less active in the private markets than it was several years ago. As a result, it is no longer the largest Tiger-related firm.
That distinction goes to Coatue Management, by a hair. In its regulatory filing, the firm reported $46.3 billion in assets at year-end, or just $300 million more than Tiger Global. This was up 15.75 percent from 2022, when it managed a total of $40 billion. At year-end 2021, it managed $60.6 billion.
Coatue has an extensive separate venture capital business that no doubt was hurt by markdowns as well. In 2023, Coatue’s long-short fund gained 21.5 percent and the long-only fund surged 55 percent.
Viking Global Investors also saw its total assets rise last year, to $45.3 billion. Although it continues to rank as the third-largest Tiger-related firm, it is now virtually the same size as Tiger Global and Coatue. However, unlike the two other firms, Viking has not seen its assets drop sharply in recent years. It managed $37.7 billion in 2022 and $46.9 billion at year-end 2021 — more or less the same as in the most recent year.
In part, Viking has had a different experience because it was not hurt nearly as badly as the other Tiger firms during the huge sell-off in the stock market and technology in late 2021 and 2022.
As II has reported, Viking Global Equities, the firm’s long-short fund, gained 13.8 percent in 2023, less than other firms. But it lost only 2.4 percent in 2022 and 4.5 percent in 2021. Last year, Viking Long Fund surged 29.3 percent. The Viking Global Opportunities hybrid fund was up 22.6 percent in 2023 and the drawdown fund climbed 25.2 percent.
Elsewhere, Lone Pine Capital’s assets rose to $15 billion in 2023 from $14 billion the previous year, according to the annual regulatory filing. But this gain was small compared to that of the funds, suggesting the firm suffered from redemptions.
In 2023, Lone Pine’s long-short fund increased 19 percent after losing 36 percent in 2022 and 7 percent in 2021. The long-only fund jumped 32 percent after dropping 42 percent in 2022. At $15 billion, Lone Pine’s assets are slightly more than half the $28.7 billion at year-end 2021, according to earlier regulatory filings.
D1 Capital Partners managed $19 billion at year-end, down slightly from $19.6 billion at the close of 2022, say people who are familiar with the firm. The AUM reported in the annual regulatory filing is a regulatory capital figure, which includes leverage and is therefore not comparable to other firms’ reported assets.
At the lower end of the spectrum, Light Street Capital Management, which since last year has been one of the top-performing hedge fund firms after two devastating years, saw its assets decline. It reported just $590 million at year-end, down a bit from $605 million at year-end 2022 and more than 70 percent from two years ago, when it reported $2.1 billion. Yet last year, its long-short fund surged 45.7 percent and its long-only fund jumped 58 percent.