Tiger Global Memo - anyone able to comment on legitimacy?

The copy of a big NY paper article that was a WIP now making circles in NY hedge fund world:

Internal dynamics at technology investment firm Tiger Global have worsened as the firm’s limited partners (LPs) continue their revolt against the firm. Significant investor withdrawals have continued in Tiger Global’s public investment funds through 2023 to date as limited partners sour on the firm’s investment judgement and capabilities according to four sources familiar with the matter. It has been widely reported that Tiger Global is looking to sell many of its startup investments to third parties and has hired Evercore to facilitate the process. However, the driver of this move has not yet been disclosed until now. According to four sources close to Tiger Global, the limited partner redemptions that the firm is experiencing have forced the firm to take this unprecedented action. According to these sources, Tiger Global is facing an asset-liability duration mismatch, similar to the failed technology bank SVB. In its public funds, Tiger Global has short-to-medium term duration capital from investors (as is typical in the industry for public funds), which has been used to fund some of Tiger Global’s investments in startups, which are long-term illiquid private investments (which is unusual in the industry as typically public investment funds only invest in highly liquid public securities). According to sources, Tiger Global’s two portfolio managers Chase Coleman and Scott Shleifer initially had thought that the asset-liability duration risk was remote since the private investments in the public funds were capped at 20% of Coleman’s hedge fund (down 56% in 2022) and Shleifer’s Long Opportunities fund (down 67% in 2022). However, as the public equity portion of the public funds fell dramatically in value in 2022, the public funds are now actually comprised of a majority of illiquid private startup investments. Though Tiger Global erected investor “gates” a year ago to help address this asset-liability mismatch issue and restrict investors from fully withdrawing their funds, there has been a subsequent flood of limited partner redemptions and investors have complained that these “gates” are still up after an entire year. “It’s ridiculous that they still have the gates up,” said one current Tiger Global LP. “Tech stocks have been rocketing up this year. How can they [Tiger Global] think gates are even remotely acceptable? This isn’t the [2008-09] GFC [Great Financial Crisis]. Citadel was up 30% last year. I’m not sure what is wrong with these guys.” It should be noted that the fact that Tiger Global can put up these gates and restrict investor withdrawals places them in an improved position relative to SVB, which as a bank does not have the ability to block depositors from withdrawing funds. However, according to sources, the longer that Tiger Global keeps the “gates” up, the greater the risk that withdrawing investors never return to Tiger Global.

According to several institutional investors, given how internal dynamics work at most limited partners such as university endowments, pension funds and sovereign wealth funds, institutional investors do not have the luxury to stick with Tiger Global’s public funds and wait for better returns. As one former Tiger Global LP put it, “Unfortunately, hope is not a strategy. We are talking about student financial aid at universities, hospital budgets, etc. – this is serious stuff.” These institutional investors have pointed out that Tiger Global has experienced several large drawdowns and periods of meaningful underperformance relative to its Nasdaq 100 index benchmark over the last decade and limited partners do not have any justification to argue internally for keeping an investment at Tiger Global. Investment executives at limited partners that have historically advocated for a sizeable investment in Tiger Global now fear for their job security according to several sources. “If Tiger Global has another big drawdown in performance, some of those LP personnel that had steadfastly recommended investments in Tiger Global will lose their jobs,” said one former Tiger Global LP in Shleifer’s Long Opportunities fund who spoke on the condition of anonymity for fear of reprisal. According to another former Tiger Global LP, “It turned out that Scott [Shleifer] and Chase coleman are high-momentum cowboys. FOMO [fear of missing out] is just an ingrained part of their DNA – that is the last thing you want in a manager. Of course, they are going to have positive returns when AI-related equities enter a bubble,” the former LP continued, “but I’ve told most of my committee that I expect they will have another 50%-plus annual decline over the next 3 to 5 years. At that point, Tiger’s public funds will close up shop and as an LP, you will get completely screwed. Chase’s [Coleman’s] mentor closed up shop after a bad run as well.” Similarly, another institutional investor who conducted due diligence on Tiger Global’s hedge fund as an investment in 2016 and ultimately decided to pass noted, “I’m not sure why any rational person would invest in these funds. Even if you look at their performance year-to-date, they have generated less than half the return of the Nasdaq 100, their performance benchmark. And after horrific underperformance in the prior two years, it’s abysmal.” According to recently released data, they have also meaningfully underperformed the Nasdaq 100 over the past 12 months as well.

In addition to its issues with maintaining investors in its public funds, Tiger Global has also faced troubles with the SEC. According to five sources familiar with the matter, the firm has been under investigation from the SEC with SEC representatives visiting the firm’s office overlooking Manhattan’s Central Park several times over the past year as well as engaging in questionings over Zoom with the firm’s portfolio managers Coleman and Shleifer. A focus area for the SEC according to these sources has been uncovering of intentional deletion of internal firm communications over email and text that should have been retained according to SEC regulations. Some of these deleted messages contained internal discussions around how to find ways to extract more fees from limited partners to offset the blanket fee cut that Tiger Global had offered its investors after poor performance in 2022. Some of the deleted emails and texts between Tiger Global executives went through various ways to extract more fee income from LPs (some of which include nonprofits, pension funds, and university endowments) such as by improperly inflating fund expenses that should have been allocated to Tiger Global’s management company (i.e., having LPs foot the bill rather than Tiger Global’s portfolio managers). Other SEC focus areas involved concerning trading activities that Tiger Global may have felt pressured to engage in as performance plummeted. Lastly, an unusual item that has been noted by the SEC according to several sources is that Tiger Global never replaced its former General Counsel who departed from the firm in 2021. While Tiger Global does have several junior and mid-level lawyers on its team according to several sources, it is highly unusual for a $50 billion investment firm to not have a seasoned general counsel leading the legal and compliance functions. According to several sources, this was done to more easily skirt certain regulatory and compliance requirements.

Meanwhile, for Tiger Global’s private funds, fundraising efforts continue to go very poorly with funds raised for the latest Private Investment Partners (PIP) 16 private fund coming in at 80% lower than the prior fund PIP 15 and 70% lower than an internal goal of $9 billion for PIP 16 set last summer. Given this internal goal was established after growth tech stocks had already reset, it had already taken into account the change in fundraising conditions, which makes the massive miss by Tiger Global all the more surprising. One LP in PIP 16 that participated in a recent close expressed frustration, “Their IR team had told me earlier in the year that things were going well with the fundraise and that they felt good about raising at least $6 billion in short order. That’s what I had told folks internally. Now they’ve made me look like a liar internally and my colleagues have all soured on the opportunity. We typically abide by our commitments but there’s no way we are funding the full commitment here. A few of my friends at other places had gotten the same misdirection from Tiger and are also upset.” Another allocator who passed on the PIP 16 fundraise noted, “I’m not sure it is accurate to paint a broad brush and say fundraising is tough for all. The market has just become more discerning. Great investors like NEA and TA Associates are able to still raise record funds and bad investors like Tiger are being cut.”

According to several allocators in venture funds, investors that have conducted diligence on Tiger Global’s PIP 16 have largely passed due to a number of cited issues: 1) concerns over the poor investment track record, questionable integrity, and alcohol issues of Scott Shleifer [this reporter has reviewed audio and video recordings that validate such issues and present Shleifer as an Odey-like persona; to provide a sense for the content of the recordings, the most tame video that was presented to me shows Shleifer on a Zoom meeting with many Tiger Global employees discussing how a particular investment pitch was so exciting that it made him “rock hard,” an apparent reference to a male erection], who is a co-portfolio manager for PIP 16 under the fund documents; 2) a sexual discrimination settlement from early 2021 that had been hidden from Tiger Global’s limited partners by Shleifer, demonstrating a propensity to deceive the firm’s investors; 3) high employee churn and departure of high profile execs such as Lee Fixel (who does not appear to have had any fundraising trouble and is out raising his 5th $1.5 billion fund in 3 years) who were primarily responsible for Tiger Global’s successful private investments; and 4) a perspective that the current Tiger Global co-portfolio managers are poor risk managers and investors who have grown increasingly cavalier with limited partner capital through the pursuit of a high-growth, high-beta strategy that only worked for a period of time due to very low interest rates and has now completely failed.

One of the banks that worked with Tiger Global indicated that they saw a high PIP 16 pass rate by their clients and contacts but noted that the poor receptivity was not driven by Tiger Global’s returns but by its personnel. More specifically, this bank said they received consistently negative feedback from clients that had attended Zoom meetings with Shleifer on “who he is as a person” and noted that he appeared to be “frantic and on cocaine” [the bank’s clients said this to describe Shleifer’s behavior during the Zoom meetings and have no proof that he has ever used cocaine or any other illegal substance for that matter]. The bank’s clients also noted that Shleifer made repeated references both implicit and explicit to his net worth which turned many of the less flashy prospects off. One large institutional LP that has pulled away from Tiger Global cited a passage from the 2021 book The Cult of We as the catalyst for their re-evaluation of their relationship with the firm: “Once, he and Neumann were wooing an investor from Tiger Global at Gross’s beach house in the Hamptons. After flying in by helicopter, the investor, Scott Shleifer, drank so much with the duo that he threw up on Gross’s fluffy dog.” The LP noted, “All the diligence you need to do is read that page from that book.

We are lucky that one of our investment officers showed that to us ahead of PIP 16 fundraising. It wasn’t even our venture guy that found it surprisingly. We were obviously a hard no on PIP 16. The crazy thing is that we did some digging on the WeWork situation with some of our relationships and found out that Tiger actually put in a big anchor order in the WeWork IPO before it got pulled. It was only them and one other firm that put in orders. They just consistently make the wrong call in high-profile blowups.” In the current market environment, fund investors are looking to make safe bets in funds where they won’t face career risk. As one allocator noted, “There will likely be folks fired at large institutional LPs who had pushed for large commitments to Tiger Global. No one at these institutional LPs would step up now and push for additional investment in Tiger. Given all the well-known issues the firm currently has, it is career suicide for an allocator if returns continue to be poor.” Two limited partners at Tiger Global have also noted that they still do not believe they have gotten the full story on the sexual discrimination settlement from Tiger Global leadership and believe the co-portfolio managers at Tiger Global are not being forthright. According to one Tiger Global LP, “They are always stressing ‘integrity’ in all their investor letters yet they weren’t honest about this settlement with us. It makes me wonder if they’ve misled us in other areas as well.” The firm has recently experienced more issues with retaining its female investment professionals. Last month, Connie Lee, Tiger Global’s only female partner on the investment team left the firm. Lee, who was the promoted to partner in the wake of the Tiger Global’s sexual discrimination scandal with a different female investment professional, generated strong returns as a short seller at the firm. Over time, she expanded beyond short selling. In one instance, Lee and Shleifer worked on detailed diligence of WeWork together. While Lee had insisted they not move forward with an investment in WeWork, Shleifer ignored her recommendation and placed an order in the WeWork IPO anyways – something Shelifer did not quite often with the investment team. This would have been a disastrous decision had the WeWork IPO ultimately proceeded at the price that Shleifer offered. Several sources close to Tiger Global have indicated that Lee experienced several issues with Shleifer and often complained to her colleagues about him, even going so far as messaging her colleagues with her complaints of Shleifer through various messaging platforms over the years. Shleifer has been known to have other issues with female colleagues historically. According to three sources close to Tiger Global, Shleifer in recent years pushed out another senior female executive who he felt did not respect him enough or have his back. One source elaborated noted, “She clearly thought very highly of Chase coleman and worked very hard for him over the years and did a great job. But you could tell she felt uncomfortable with Scott [Shleifer] and didn’t have respect for him. He couldn’t stand that she favored Coleman over him so he spent a fair amount of time orchestrating her departure.” Shleifer is always known to have churned through his female executive assistants over the last 15 years with a young blonde executive assistant in the recent past hiring legal counsel and demanding a settlement after withstanding a fair amount of alleged abuse according to three sources. This executive assistant subsequently left to work at another New York hedge fund where the work environment has dramatically improved.

Unfortunately, for Tiger Global’s LPs, it appears that the firm’s obfuscation and misleading is quite common. According to four sources, Tiger Global’s portfolio managers Coleman and Shleifer made sizeable personal withdrawals from the public funds in H2 2021 while writing in a letter to LPs in December 2021: “We have committed to communicating with you when we believe the opportunity set seems asymmetric. For TGI and TGLO [Tiger Global’s public funds], we believe now is one of those times. ... We want to reiterate our conviction in our portfolio and share that we are opening both funds to a limited amount of capital from existing investors on January 3. .... We track the drawdowns in our funds carefully, and we believe the current one is not unlike others we experienced in 2016, 2018, and the beginning of 2020 ... we are excited by the opportunities we see today and intend to continue playing offense.” It appears that Tiger Global’s portfolio managers were pumping up their book to LPs to get them to invest more in the firm’s public funds while not believing their message themselves as Coleman and Shleifer actively took out a portion of their own personal capital from the public funds. It was unquestionably a terrible time for Tiger Global LPs to add more to TGI and TGLO (down 56% and 67%, respectively, over the subsequent twelve months). While the legality of misleading LPs to think that Tiger Global’s portfolio managers had conviction in the public portfolio to get LPs to invest more while the portfolio managers themselves were withdrawing a portion of their personal capital from the public funds is unclear and an issue for lawyers and the legal system to address, it is the case that those that are familiar with this set of actions by Tiger Global have described them as unethical. One source noted that “they [Tiger Global’s portfolio managers] seem to relish in their ability to consistently deceive. They’ve practiced it a lot over the years and have it down to an art form. It’s unnerving.” However, not all of Tiger Global’s LPs agree that dishonesty and obfuscation are necessarily negatives. One long-time Tiger Global LP recently noted, “Being able to control the narrative can be super valuable. If they control reporters to get good stories written about them, who cares? They’ve clearly shown a lot of growth in this area and are better at PR now. For example, I’m not sure if they have Redacted on retainer but they’ve gotten that one reporter to write a bunch of positive articles on them. Most of what they are telling her is false but it’s amazing they are able to get her to write it as these stories can help build the brand. I want to get the biggest check back from Tiger as possible and if they have to massage the truth to get there so be it.” [This LP did not specify that any part of our conversation was off-the-record once during our call.]

On top of the headwinds to Tiger Global’s PIP 16 fundraise, the investment firm’s public business continues to meaningfully underperform with Tiger Global’s hedge fund only gaining 16% year-to-date through May vs the Nasdaq 100 up 31%. Internally, Tiger Global tracks its performance relative to the Nasdaq 100 given it invests primarily in larger capitalization high-growth technology companies. According to several investors in Tiger Global, the investment firm’s investors are incredibly frustrated that after weak performance in 2021 and horrific performance in 2022 for Tiger Global’s public funds, the investment firm has continued to underperform with Tiger Global’s hedge fund underperforming its benchmark index (Nasdaq 100) by 1,500 bps. One large Tiger Global LP lamented, “They [Tiger Global] massively underperformed on the way down and now they continue to underperform on the way up. This is the worst conceivable situation for an LP and we’ve lost our patience.” With sporadic and volatile returns starting to cripple the organizations, Tiger Global is scrambling and pivoting to making non-tech investments including financial institutions, aerospace, healthcare and even a potato goods producer. This style drift has caused issues for some of Tiger Global investors who see these moves as indicative of a loss of confidence internally in their own investment prowess. According to one LP, “You can’t be good at everything and now they are trying out a bunch of different sectors to see what sticks without any true expertise in those sectors. The best trade YTD was to be long high-growth tech, which is supposed to be their expertise.

Their investments in non-tech companies like Barclays and Fiat have gone very poorly.” Another Tiger Global LP agreed, “We like managers that stick to their knitting. This Apollo investment is likely driven by whatever PM that led the last one a few years ago trying to remind folks internally that they have made some profitable investments. You pitch an old successful investment that you think will be fine going forward so that the rest of the team is reminded of your prior profitable investment – it happens in our shop from time to time when folks are feeling insecure.” With concerns of weak risk management by Tiger Global co-portfolio managers Coleman and Shleifer, including the aggressive use of leverage and purchases of billions of dollars of crypto exposure at the market peak, limited partners believe that Tiger Global is “damaged goods,” has “lost its touch” and “are looking to move on.” When pressed with the fact that Tiger Global has made good investments over time as well, one current limited partner in PIP 9 through PIP 12 noted, “Flipkart, Roblox, Coinbase, Stripe, and Nubank were all 100% [former Tiger Global partner] Lee [Fixel] investments. He sourced and led those investments and Tiger was adamant with us that Lee was 100% responsible for those investments back when Lee was still at the firm and running the private business. The guys remaining at Tiger today have really bad track records.” When asked if Coleman and Shleifer could salvage the Tiger Global brand name, capital base, and infrastructure by swapping themselves out as portfolio managers for new prominent hires with better track records, limited partners say it wouldn’t matter given the job security issue for personnel at Tiger Global LPs. According to these sources, if Tiger Global has another year of meaningful underperformance at any point over the next 5 years, it could ruin the career and reputation of an allocator if they ignored the many warning signs and continued to maintain an investment in one of Tiger Global’s funds.

According to sources, amongst the types of limited partners that have soured on Tiger Global are sovereign wealth funds. This is a particular blow to the investment firm as sovereign wealth funds had initially been viewed as a large potential source of additional assets by Tiger Global execs and the firm had experienced some success in courting them in 2020 and 2021. However, that has now changed with several sovereign wealth funds viewing their investment in Tiger Global in 2020 and 2021 as a mistake and those sovereign wealth funds that had previously passed on investing in Tiger Global expressing relief that they had done so. According to sources, one large sovereign wealth fund submitted a full redemption request in 2022 for its entire multi-hundred million commitment in the public funds citing issues of poor portfolio management as well as a lack of risk controls including excessive leverage, high gross exposure, and a multi-billion dollar move into crypto at the market peak in the public funds. Given that it takes quite some time for Tiger Global investors to fully withdraw from Tiger Global’s public funds, one limited partner noted that they expect most Tiger Global investors to submit a full redemption request throughout 2023. “Given it can take up to four years to get all of your capital out of [Tiger Global’s] hedge fund after submitting a full redemption request, it is likely that most will submit that request. If there is a miracle and something improves, you can always modify your request such that there is no downside to submitting the full redemption ASAP.” Limited partners’ perception of the attractiveness of an investment in Tiger Global’s public funds as part of a broader hedge fund portfolio has completely diminished. According to several sources, investors in hedge funds initially thought they had to choose between consistency of returns and high long-term returns when choosing a hedge fund manager style but now there are multi-managers like Citadel and DE Shaw that have produced both much more consistent and higher returns than Tiger Global. Investors in hedge funds have also decided that the chief investment officers at those funds with adjacent strategies to Tiger Global such as Viking Global, Altimeter, Thrive, Addition, Dragoneer and Coatue are preferable with those investment firms expected to see inflows as investors shift assets away from Tiger Global according to sources.

In addition to the current lack of interest by limited partners in Tiger Global, venture-backed startups have also lost interest in working with the investment firm with several founders in Tiger Global’s current portfolio saying they would not accept more capital from the investment firm in future rounds other than what is required under Tiger Global’s contractual pro rata rights. Several reasons were cited with the most prevalent being the sexual discrimination settlement that was covered by different outlets in January. “The political climate is such and there are so many great VCs to work with that it doesn’t make sense to work with a firm with those types of cultural issues. And several of our employees have cited their personal concerns about working with Tiger going forward due to this issue,” said one prominent startup founder who spoke on background. Another founder pointed to Shleifer as the issue: “I don’t think Scott [Shleifer] really knows what he is doing as a startup investor. The advice he gave us was strange and he has spent most of our catch-ups talking about himself. Believe it or not, you do need some empathy to be a good VC.” One entrepreneur noted that he had a seed investor in his startup that regularly bad-mouthed Tiger Global over the last few months after Tiger Global reneged on an LP commitment to the seed investor’s fund, “It’s a small community and that type of behavior breeds a lot of distrust. I’ve never interacted with Tiger but when I have a great investor that I respect repeatedly saying negative things about them, it just means I won’t take a meeting with them. There are too many great funds out there.”

Tiger Global founder Coleman has placed the blame for the upending of what was once a successful investment firm on Shleifer’s shoulders. According to those familiar with Tiger Global and Coleman’s thinking, when Shleifer was sole portfolio manager of the public funds in 2016, he single-handedly drove poor performance for the funds by constructing an aggressive, high-beta portfolio and then fully exiting the portfolio at the worst possible time at the market bottom in February 2016. Performance improved in subsequent years as Coleman took over portfolio management for the hedge fund and tried to rein in Shleifer’s risk-seeking behavior. However, Shleifer continued to push for large bets in the highest growth companies without concern for valuation. This strategy began to fail in 2021 and then ultimately imploded in 2022. According to sources, Shleifer convinced Coleman to buy high-growth stocks in the hedge fund that Coleman would have not bought otherwise if it had not been for Shleifer’s repeated insistence and assurance that these were “no-brainer” investments. That said, other sources counter this view and say that Coleman also had a role in the public funds’ poor performance. For example, two sources said that Coleman was responsible for Tiger Global’s public investment in data analytics company Tableau. The investment firm had invested 10% of its hedge fund in Tableau and the investment was decimated in 2016, and Coleman proceeded to completely exit the investment in Tableau in 2016 at close to the bottom, incurring a large loss. This historical pattern of Tiger Global’s co-portfolio managers taking aggressive bets and then quickly giving up on the bets when things go against them has been a frequent source of frustration cited by Tiger Global’s limited partners.

Tiger Global’s investment performance in China has also angered Coleman according to sources. Shleifer, who has been the main Tiger Global exec responsible for leading Tiger Global’s public investments in China, advocated for completely eliminating exposure to public Chinese stocks in the fall of 2022, marking one of the few times since the early 2000’s that the firm did not have China exposure in its public funds. Unfortunately, this coincided with a bottom of the market for Chinese technology stocks. Since Tiger Global communicated to the media that they had exited their China exposure last fall, stock prices of Baidu, Tencent, Pinduoduo, Netease, Li Auto and Alibaba are up over 85%, 65%, 40%, 70%, 115%, and 35%, respectively. As a result, Tiger Global limited partners feel that the firm has lost its touch investing in China with one investor noting, “They broadcasted that they had exited their positions in China at the literal bottom of the market for China tech stocks – you basically want to do the direct opposite of what they do at this point.” According to two former limited partners of Tiger Global, the main shining star of the firm’s China investing strategy was the investment in http://JD.com many years ago, which was sourced and led by Xiaohong Chen who departed from Tiger Global to launch her own fund in 2012.

One current employee at Tiger Global who spoke on the condition of anonymity noted that Coleman and Shleifer regularly argue with each other on Zooms in front of the investment team and do not appear to like each other personally. “They have very different personality types and that creates a lot of friction and clashes. The soft market environment has only exacerbated things. You get the impression based on their arguments that Chase coleman doesn’t respect Scott [Shleifer] as a person and Scott doesn’t respect Chase’s intellect or investing ability. Scott used to really attack Chase aggressively in front of the whole team back in 2020 and 2021 when performance was better but as the market has turned, Scott has backed down and lost a lot of his confidence.” Three sources that attended a 2021 birthday party that Coleman threw for himself in Manhattan cite that it appeared he had lost his focus on Tiger Global and taken his eye off the ball at that point. At his birthday party in a Manhattan apartment, Coleman told these sources that he was satisfied with all of his professional achievements to date and “simply didn’t care anymore.” Confirming a Forbes article that indicates that Coleman is friends with Norwegian DJ Kygo, these sources elaborated that Coleman hired Kygo to DJ at his party and also indicated that various drugs such as MDMA and magic mushrooms were distributed among guests there.

According to several sources familiar with Tiger Global, Coleman likely regrets the loss of former exec Feroz Dewan who left Tiger Global in 2015 to manage his own billion-dollar fortune. Dewan had been the portfolio manager of the hedge fund for several years, a role he assumed after posting better performance than Shleifer during the financial crisis. Dewan was known to be much more valuation sensitive than Shleifer, who is said to stress a “growth at all costs” mantra, repeatedly pushing to invest in the highest growing companies regardless of burn, unit economics or business model with Carvana being a case in point. Dewan was known to be much more measured and able to assess both the upside opportunities as well as the downside risks whereas Shleifer was just focused on the upside opportunity. According to sources, Shleifer was known to build his own financial models for investments, which were so simply constructed they appeared to be built in less than 10 minutes and did not include a downside or “what could go wrong” case.

New members of Tiger Global’s investment team were often surprised that multi-hundred million dollar investments were made based on these simplistic models created by Shleifer. One former limited partner in Tiger Global noted, “Feroz [Dewan] just had a better head on his shoulders. That’s what you want in a portfolio manager. Scott [Shleifer] is a cowboy plus he always came across as very glib in our meetings with him.” It is believed that this trigger-happy approach is what ultimately led Shleifer to invest almost $1 billion in fraudulent startups such as FTX, GoMechanic, BharatPe, Milkrun, RenoRun, Byju’s and Danke. He also led many failed public equity investments at Tiger Global in recent years such as Softbank, Carvana, Just Eat Takeaway, Applovin, Barclays, TAL Education, and Fiat Chrysler. That Shleifer was such a big fan of Softbank and its founder Masa that he invested over $1 billion in Softbank’s public stock was surprising to many close to Tiger Global. According to a source familiar with Tiger Global, “Scott has a very go-big or go-home investment strategy where he moves all his chips into as many fast growers as he can find and hopes for the best. It’s an investment approach characterized by sheer aggression. He’s been like this since the early days. It’s not surprising that he would love Masa [Softbank’s founder] given how aggressive Masa is but Softbank itself is not a fast grower so was a bit of a different beast for Scott. To invest over $1 billion, he [Shleifer] clearly must have thought [Softbank’s] Vision Fund was going to be a home run, which obviously was not the case.” One potential bright spot for Shleifer a couple years ago seemed to be the firm’s private investment in China social media giant Bytedance; however, that investment has also soured with the latest fair value estimates at a more than 50% decline from where Tiger Global most recently acquired shares. Shleifer plowed billions of investor capital into Bytedance in 2020 and 2021 at what were peak valuations in retrospect, according to one Tiger Global LP.

Meanwhile, sources that participate in the GP staking business and invest in fund management companies have described Tiger Global as “having no terminal value.” One investor in fund management companies noted that “[Tiger Global] doesn’t do anything better than any other growth manager and does many things worse. Honestly, the only thing that seems remotely differentiated is Chase [Coleman’s] short selling capability, a strategy that has generated alpha in most years. There are just so many better investment managers I’m not sure why any third party would invest in the management company.” However, three sources have noted that even the short selling effort has made many large mistakes. These sources said that Coleman targeted Elon Musk and Tesla in early 2020, saying that Musk was a “futurist drug addict” with “no real business building skills” and “wasn’t even an actual founder of Tesla.” Coleman proceeded to lose over $500 million on his short on Tesla and covered the short a few months later. The fund management investment discussion is likely a moot point according to another source as there is a high probability the public funds business shifts to a family office and the private funds will likely continue to face strong fundraising headwinds for quite some time. There have been rumors that Coleman is considering a family office shift in the coming years but confidants note that there would be no discussion of it in advance. Due to concerns of leaks, impacts on employees, etc., Coleman will publicly stay committed to the current structure until the firm is ready to announce otherwise.

With all the turbulence at Tiger Global, several sources at private equity and growth equity firms have said that they have been approached by investor relations personnel at Tiger Global who are interested in jumping ship to a competitor. These sources noted that the investor relations personnel at Tiger Global had multi-year pay guarantees that were ending and they wanted towork at a firm that had more growth potential and where it was easier to raise capital. However, these sources indicated that no investor relations personnel at Tiger Global have received offers from their firms to date as these firms believe they have sufficient fundraising staff on hand currently or prefer to hire from firms that are doing well. Amongst the job-searching investor relations staff at Tiger Global were mid-level professionals {REDACTED} according to several sources.