“There is clearly some anxiety around what the new Tiger (Global) is,” said the founder of an Indian business-to-business (B2B) startup backed by the New York-based investment giant. “Till 2020, we knew what Tiger wanted and how it operated. That has changed in many ways, I think.”
Over the past two years, as Tiger Global Management expanded its portfolio, especially through investments in private firms, Indian startups benefited significantly from its largesse. It reportedly reportedly Business Today Tiger Global pumped in $2.2 bn in Indian start-ups in 2021 Read more put in $2.25 billion in Indian startups—the highest by any venture-capital (VC) fund in 2021. While it backed 335 deals deals CB Insights The future according to Tiger Global Management Read more worldwide—a 4X jump from 2020—as many as 52 of those, involving over 20 unicorns, were in India. More than even Japanese investor SoftBank.
Taking bets on Indian startups is hardly new for Tiger Global—it has backed and reaped the rewards of investments into the likes of e-commerce giant Flipkart (acquired by US retail major Walmart in 2018) and food-delivery behemoth Zomato (went public in 2021).
The rapid clip of investments in companies like microlending platform Slice, credit-card-bill-payment platform CRED, and crypto exchange CoinSwitch earned Tiger Global goodwill as well as infamy. Though it developed an image of being founder-friendly, critics baulked at its rather fast-paced due diligence—a lot of which it outsources to management-consulting firms such as Bain & Co.—followed by generous investments at high valuations.
But as 2022 progressed, Tiger Global-backed companies’ fortunes turned for the worse. The economic downturn precipitated by rising interest rates aimed at curbing high inflation has hurt Tiger Global’s big bets in the likes of payments startup Stripe and Chinese internet behemoth ByteDance. While Stripe’s valuation fell fell Wall Street Journal Stripe Cuts Internal Valuation by 28% Read more by 28% to $74 billion, that of the TikTok parent—once the highest-valued startup in the world—slid 25% to below $300 billion.
In India, its portfolio firms like $3.4 billion edtech Unacademy, $5.4 billion e-pharmacy PharmEasy, and $3.2 billion digital-healthcare company Innovaccer have together laid off hundreds of employees to reduce their cash burn. PharmEasy even withdrew withdrew Business Standard PharmEasy parent withdraws IPO DRHP Read more its pre-IPO draft papers in August, citing market conditions.