Tiger Global Is Ready To Contribute $40 Million In Rajasthan Royals

According to a major newspaper, Tiger Global, an investing firm known for its technology-focused ventures, is poised to purchase a stake in the IPL franchise Rajasthan Royals.

The firm is expected to invest forty million dollars in RR, raising the overall value of the franchise to $650 million. As per the report, Tiger Global may provide funds to one of the Rajasthan Royals shareholders.

Tiger Global, a well-known investor and one of Flipkart‘s early investors, has been instrumental in accelerating the development of unicorns as well as soonicorns (soon-to-be-unicorns).

Notably, the investment conversations take place at a moment when the internet and startup sector is struggling from recession fears and a fundraising winter that has dried up new avenues of finance.

Tiger Global’s acquisition of the Rajasthan Royals might mark the company’s first move into India’s sporting industry and a move past the digital commerce industry.

Tiger Global had undertaken conversations with other IPL franchises; nevertheless, the report, citing persons acquainted with the situation, stated that the funding agreement with Rajasthan Royals will probably be completed.

Tiger Global also has a stake in the massive online fantasy gaming company Dream Sports. The organization, recognized for its investments in firms such as Flipkart, Zomato, Ola, and Delhivery, among others, also owns a share in Dream Sports, which operates Dream 11.

Tiger Global additionally made investments in the quick-service eatery Wow! Momo and the tea brand Chaayos. It is diversifying away from its main technology bets and reinforcing what it began in India over 15 years ago.

The parent company of the Rajasthan Royals, Emerging Media, is controlled by UK-based Manoj Badale. He owns more than 60% of the franchise and acquired the rights in 2008.

RedBird Capital, one US-based investing group noted for its interest in professional sports teams and assets, bought shares in the Rajasthan Royals in an additional transaction valued at more than $250 million in 2021.

RedBird Capital also owns an interest in the Boston Red Sox of Major League Baseball as well as the Liverpool football team of the English Premier League.

On Sunday, Mumbai Indians’ emphatic eight-wicket win over Sunrisers Hyderabad in the current Indian IPL put Rajasthan Royals out of contention for the IPL 2023 playoffs. With an NRR of 0.148, the team won seven games and lost seven others.

Rajasthan Royals reached the IPL 2022 final after a team revamp last season, but were defeated by the eventual champions Gujarat Titans.

PhonePe, a Decacorn fintech business, announced an extra USD 100 million in funding from General Atlantic on Monday. Significantly, Ribbit Capital, Tiger Global, and TVS Capital Funds were also involved in the company’s current investment round.

Although this financial commitment will significantly increase the value of the Rajasthan Royals, the Mumbai Indians remain far ahead in terms of worth. The Mukesh Ambani-owned club is worth a whopping $1.3 billion.

With a $1.15 billion valuation, CSK is directly behind MI. The other clubs in the top five are KKR ($1.1 billion), LSG ($1.075 billion), and DC ($1.035 billion).

Meanwhile, RCB is worth $1.025 billion. If RR is successful in obtaining this funding, the inaugural edition winners will see a nearly 300% increase in two years.

According to a recent study, India’s three largest startup financiers, Sequoia, Tiger Global, and SoftBank, have made only 11 deals this calendar year, compared with 60 at the same time last year.
This demonstrates the extent to which the startup ecosystem is being impacted by the funding winter.

As per the study, Tiger Global spent more than $6.1 billion over 240 deals between 2014 and 2022. In 2022, the IPL was estimated at $10.9 billion, making it one of the most valuable sports leagues.

This represents a 75% increase from $6.2 billion around 2020. This entry into the IPL franchise area is consistent with Tiger Global’s commitment to the sports economy.

It has seen major institutional support in sporting leagues throughout the USA, the UK, and Europe. Yet, the rise of private equity companies making investments in Indian sports teams is just getting started.

CVC Capital Partners, which is a UK-based investment company, has become the very first of its kind to purchase an IPL club in 2021. It paid Rs 5,625 crore for ownership rights of the Ahmedabad-based team Gujarat Titans.

However, numerous of Tiger Global’s Indian portfolio businesses have recently had financial or governance issues. Legal issues at BharatPe are now well documented and continue to exist.

Its portfolio firms, which include PharmEasy, GoMechanic, and ShareChat, have also struggled in recent months. Tiger Global partner Scott Schleifer has stated that traditionally, returns on capital have “sucked” in India.

According to a new Wall Street Journal story, Tiger Global reduced the value of its entire assets in private companies across its funds by around 33% in 2022.

Tiger Global led an $18.85 million (about Rs 156 crore) funding for IoT firm Infinite Uptime. Current shareholders GSR Ventures, Mayfield, and others joined the extended Series B fundraising round for the Pune and California-based company.

In December 2020, Infinite Uptime secured $5.15 million (about Rs 38 crore) in a Series B investment round sponsored by Ventureast. Previously, the startup raised $5 million in a Series A financing round facilitated by Mayfield with GSR Ventures in July 2018.

Kois, a Belgian-based innovative impact investor, is also on board. Tiger Global is acting as a seller in recent weeks after a years-long purchasing frenzy in the venture capital industry.

Based on a person with firsthand knowledge of the transaction and two others who have been informed of the deal, the New York-based bridging investor has employed Evercore.

The purpose is to look for what is referred to as strip selling in the secondary marketplace to sell a selected portfolio comprising mid-stage along with late-stage VC-backed companies.

According to reports, the firm aims to sell stakes in its private investments to repay liquidity to LPs. The position of Evercore, a top secondary consultant, as well as the framework of the proposed transaction, were previously unknown.

Tiger Global was founded in 2001 to operate a long-short investment firm by Chase Coleman. It quickly moved into private markets, primarily in China.

It eventually invested in hundreds of fast-growing start-ups, including Alibaba and JD.com.

The firm’s portfolio of investments in privately owned companies has grown to account for the majority of the company’s more than $60 billion in assets over the last decade.

Rising inflation and increased interest rates slowed the firm’s push into early-stage investing, causing stocks in high-growth, speculative firms to plummet.
This encouraged private-market investors to reduce their holdings in unlisted technology companies.

Tiger Global expressed optimism in a recent quarterly statement to investors that several of its significant private holdings, such as Databricks, might be ready to list once equity markets reopen for public offers.

“Our largest private investments tend to be capital-efficient and profitable top performers seeking an appropriate window for successful public listings,” the company said in a fourth-quarter statement.

While public markets are closed, the private market has grown into an increasingly popular method for corporations to return capital to their investors. It can also allow firms to keep private businesses they own for a longer period than a normal fund structure permits.

A Rajasthan Royals official denied any deals, while Tiger Global stated that they do not want to comment on this matter.

Proofread & Published By Naveenika Chauhan