Lee Fixel, a former top investor at Tiger Global Management, is raising one of the largest new venture capital funds in history, bucking a difficult fundraising environment for emerging tech investors following the spread of Covid-19.
Mr Fixel’s Addition is close to raising $1.3bn to invest in tech start-ups, following a quick fundraising process that was finalised in a matter of weeks, people briefed on the process said.
Addition, which counts Mr Fixel as its sole general partner, would invest at all stages of a start-up’s growth, the people said. A spokesperson for Addition declined to comment.
The fund marks a notable solo debut for Mr Fixel, who gained a reputation as a savvy tech investor while helping oversee Tiger Global’s private stakes in companies such as Facebook, Spotify and Uber.
Addition’s haul would rank as the second-largest first-time venture capital fund this century, behind only the $1.35bn NewView Capital fund that spun out of New Enterprise Associates in 2018, according to PitchBook data.
Mary Meeker’s Bond raised $1.25bn after splitting from Kleiner Perkins, according to one person briefed on the matter, ranking as last year’s largest new venture fund.
Mr Fixel’s fund adds to the glut of capital earmarked for private tech groups, as investors such as endowments and sovereign wealth funds seek out potentially high-yielding but risky investments in start-ups.
For example, Sequoia Capital, Silicon Valley’s marquee venture group, has sought to raise about $7bn this year across a series of funds investing in the US and Asia.
But first-time venture capital fund managers have faced difficulties attracting capital during the Covid-19 crisis and some have delayed their plans until later in the year, according to investors.
Mr Fixel stepped down as head of Tiger Global’s $16.4bn private investments arm last year following a 13-year career at the New York-based group. He previously represented the company on the boards of start-ups such as the fitness group Peloton.
“Lee has been a driving force behind the expansion of Tiger Global’s private equity investing activities in the United States and India, and he has distinguished himself as a world-class investor across multiple sectors and stages,” the group wrote in a letter to investors when his departure was announced.
Tiger Global’s private equity funds have generated a 24 per cent internal rate of return annually since 2003, after fees, the company told investors in March. Tiger Global declined to comment on Mr Fixel’s new fund.