Tiger Global Management was the most active investor in artificial intelligence in the fourth quarter of 2021.
The $95 billion investment management firm backed 13 AI-related startups in the three-month period, bringing its full-year total to 44. It participated in 31 mega-deals with AI companies throughout all of 2021, according to a new CB Insights report.
This happened amidst a record year for AI funding, which doubled from 2020 to 2021, reaching a total of $66.8 billion across more than 2,000 deals. These figures included three deals worth over $1 billion each.
“We’re past the point of uncertainty regarding AI – it’s mainstream now,” Louis Fischer, CB Insights analyst, told Institutional Investor via email. “There’s a reason data science companies claiming to automate AI development or bring AI development to nontechnical users are attracting some of the largest investments we’ve seen – everybody wants artificial intelligence yesterday.”
In the asset management industry, interest in AI technology goes beyond the investment opportunities. In February, an Accenture report found that firms that implemented AI practices into firm-wide operations, like data mining, signal generation, and optimization, generated 3 percent in additional alpha, II previously reported.
The end of 2021 was one of the top three quarters for funding and deals related to AI since at least 2015, according to CB Insights. Last year’s third quarter was the top three-month period.
In the fourth quarter, the majority of deals and funding occurred in the U.S. with a total deal value of $10.5 billion. Asia was the second-most active market for AI deals, with $4.4 billion.
Over the course of 2021, investment managers like Tiger Global participated in a total of 116 AI-related mega rounds, according to the report. The median size for deals backed by investment managers and private equity investors was $62 million, double its 2019 figure of $30 million.
“The leap in asset manager deal size and overall investments is only further evidence of AI being mainstream,” Fischer said. “That also means AI investors are making a lot of money. Investment companies like Tiger Global – companies that are measured on the ability to make a lot of money fast – are going to pounce on the opportunity.”
Tiger Global is the investment firm founded by Tiger Cub Chase Coleman. While the firm is known largely for its hedge funds, its private equity arm accounts for two-thirds of its total assets, II previously reported.