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FinTech Portfolio Analysis – Tiger Global Management

Prove
January 24, 2022

Though many venture capital firms have made smart investments, Tiger Global Management, one of the top FinTech investors, has emerged as the world's top Unicorn investor. At the time of writing this article, Tiger Global had invested in more than 120 Unicorns across business sectors. Of these, 47% (56) were FinTechs. Post-pandemic investments by the company have surged (more than doubled from last year), and the company will continue to invest aggressively in the US and India in the upcoming quarters.

Established in 2001, US-based investment firm Tiger Global invests in public and private companies active in the internet, software, consumer, and FinTech fields. The company launched its private equity business in 2003 and has since made investments, ranging from seed investments to pre-IPO investments, in hundreds of companies in more than 30 countries.

Since 2015, Tiger Global has closed 122 deals including 37 follow-up rounds. The company has invested in 85 FinTechs worldwide and participated in 64 mega-rounds (more than 50% of the total deals). Out of the 14 countries the company has invested in, it focuses especially on the US, India, the UK, Brazil, and China. 

In 2015, Tiger Global closed 13 FinTech deals and invested in 12 companies in Asia, the Americas, and Oceania. It participated in mega-investment rounds by Avant, Credit Karma, and Dianrong. Although in 2016 and 2017, the company cut down its investments in FinTech and other sectors, in 2018, it raised capital for FinTech and closed 13 deals. 

The number of deals closed by the company in 2019 (20) nearly doubled from 2018. In 2020, the number of deals was constant at 20 due to the pandemic-induced global economic slowdown. However, from January to September 2021, the company's investments grew exponentially from 20 to 53. Our research suggests that over the past nine months, Tiger Global has participated in 38 mega-rounds (nearly 60% of the total number of mega-rounds).

 

Payments, B2B FinTech, WealthTech, Neobanks/Digital Banks, and Cryptocurrency were the top five segments that received the highest investments. Deals in these segments accounted for 63% of the total number of FinTech investments made by the company. To date, Tiger Global has invested in 15 startups, closed 24 deals, and participated in 17 mega-rounds in the Payments segment. It has invested in 11 payments Unicorns—SaltPay, Checkout.com, Toast, BharatPe, Razorpay, dLocal, Rapyd, PhonePe, Flutterwave, Stripe, and Cedar. It has closed 11 FinTech deals in 2021 so far, including 10 mega deals. Some payments firms joined the Unicorn club after receiving investments from Tiger Global. The company participated in three major funding rounds: UK-based payments platform SaltPay’s $500 million Series C round, UK-based payments platform Checkout.com’s $450 million Series C round, and US-based POS solution Toast’s $400 million Series F round. In addition, it participated in Series A, B, C, D, and E funding rounds of Razorpay, an India-based payment gateway firm.

In the B2B FinTech segment, Tiger Global has invested in 12 startups, closed 18 deals, and participated in six mega-rounds. In 2021, the company participated in six mega-rounds and invested in seven B2B FinTech Unicorns—Brex, HighRadius, Melio, Papaya Global, Chargebee, Ivalua, and HoneyBook. Tiger Global also participated in three major B2B FinTech investment rounds: US-based expense management company Brex’s $425 million Series D, US-based treasury platform HighRadius’ $300 million Series C, and US-based invoice payments platform Melio’s $250 million Series D.

In the WealthTech segment, the firm has invested in 10 startups, closed 12 deals, and participated in four mega-rounds to date. Tiger Global has invested in five WealthTech Unicorns: Carta, Public.com, Credit Karma, Groww, and StockX. Tiger Global earned high returns after it sold Credit Karma to Intuit for a massive price of $7.1 billion in December 2020. Some notable deals closed by Tiger Global are US-based equity management company Carta’s $300 million Series E round, US-based investing platform StockX’s $275 million Series E round and, US-based stock investing platform Public.com’s $220 million Series D round.

The US, India, the UK, Brazil, and China accounted for 86% of the total number of deals closed by Tiger Global. US-based companies received the highest investments, accounting for 50% (61 deals) of the total deals. Of the 42 US-based FinTech companies the firm has invested in, 34 are Unicorns. US-based Unicorns make up 80% of the investments in Tiger Global's portfolio. Some notable FinTechs that have received investments are Chime, UiPath, Brex, Coinbase, Credit Karma, Stripe, Carta, Melio, DataRobot, SentinelOne, HighRadius, and Taxbit.

Tiger Global has been targeting India for a long time. The company closed 27 deals (22% of the total number of deals) in India. The company has invested in 16 FinTechs in India, six of which are Unicorns. Tiger Global backs almost half of India's FinTech Unicorns: BharatPe, PhonePe, CRED, Policybazaar, Razorpay, and Groww. 

The UK secured third place with seven investment deals. Tiger Global invested in six companies, including four Unicorns. SaltPay, Rapyd, Checkout.com, Revolut, and Truelayer are some companies that have received investments.

12 of Tiger Global’s FinTech portfolio companies—Blend, Bright Health Group, Coinbase, dLocal, JD.com, Ondeck, Oscar Health, Root Insurance, SentinelOne, Toast, Tyro Payments, and UiPath—have gone public, signaling the company's phenomenal success.

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