Viking Global Investors has not only survived the downturn in the venture capital business, but it's thrived.
VC fundraising is down, a growing number of private companies are raising new money at lower valuations than in earlier financing rounds, and just this past week, The Information reported that Tiger Global, which not long ago was making an average of one new investment per day, has given buyout packages to several employees responsible for fundraising.
The troubles haven't hit Viking. The Tiger Cub headed by O. Andreas Halvorsen reported to investors late last week that Viking Global Opportunities, its hybrid fund, was up 22.6 percent in 2023 and VGO Drawdown — which invests only in privates — was up 25.2 percent, according to someone who has seen the results. VGO invests in both private and public companies, but the exact mix is not known.
All capital not invested in private companies replicates the portfolio of the firm’s hedge fund, Viking Global Equities. Viking declined to comment.
Viking currently manages $46 billion, with more than $15 billion invested in the Opportunities funds. The firm currently has more than 70 portfolio companies, according to its website.
Viking’s experience sharply differs from that of many other hedge fund firms that devote a significant amount of capital to venture, most of which specialize in technology and new-economy–type consumer companies.
The majority of Viking’s private investments over the years have been in health care, life sciences, biopharma, and other medical-related companies. In fact, in the past year, gains were driven in part by at least two health care–related companies: RayzeBio and BridgeBio.
RayzeBio, which is developing radiopharmaceutical therapeutics, went public in September 2023, at $18 per share. Viking was the largest shareholder, owning 12.5 percent of the total, before the IPO, according to its regulatory filing. In late December, Bristol Myers Squibb agreed to acquire RayzeBio for $4.1 billion in cash, or $62.50 per share. At the time, RayzeBio was trading at $30.57.
BridgeBio went public in 2019, at $17 per share. Before the offering, Viking owned more than 22 percent of the shares. It is currently the second-largest shareholder, with upward of 14 percent. The stock more than quadrupled in 2020 before losing nearly 90 percent of its value by early 2022. All along, Viking did not sell any shares, and in 2023, the stock swelled by about five times.
That same year, Viking also got a big boost from non–health care company Rockefeller Capital Management, a wealth management firm that emerged from the Rockefellers’ family office. Last April, it received $622 million from IGM Financial in exchange for a 20.5 percent stake and two board seats in a deal that valued the company at $3 billion, according to a press release.
It was the first outside investment in Rockefeller to be disclosed publicly. IGM Financial is a subsidiary of Power Corporation of Canada, a holding company that also owns Great-West Lifeco and alternative asset manager Sagard. The deal made IGM the second-largest shareholder behind Viking, which remained the majority investor, per the announcement.
The hybrid and private funds were among Viking’s top performers last year.
Viking Global Equities, the firm’s long-short fund, gained 13.8 percent in 2023. Although this was about 10 percentage points fewer than the 24 percent registered by the S&P 500, the fund also finished the year above its high-water mark, a distinction many other funds were unable to boast, especially those run by descendants of Tiger Management.
Viking Long Fund fared much better, gaining 29.3 percent for the year and easily outperforming the benchmark.
