Hedge fund manager Chase Coleman made these investing mistakes even as he racked up big returns

Published Wed, Mar 17 20213:22 PM EDT

Hedge fund manager Chase Coleman revealed several mistakes he's made in the two decades he's headed Tiger Global, despite the firm's market-beating track record. Coleman — protégé of legendary investor Julian Robertson — is reflecting on his time at the helm of Tiger Global, as the hedge fund reached its 20-year anniversary. "At a company level, we have lost money on the public and private sides in just about every way possible, including investing in non-dominant players, companies with unsustainable unit economics, and businesses that were led by unprincipled management teams," Coleman said in an investor letter obtained by CNBC. His regrets also include not buying market-leading stocks because of valuation concerns and selling strong assets too soon, according to the letter. Coleman made his name working under legendary investor Robertson, who closed his Tiger Management fund in 2000 and gave Coleman $25 million to start his own fund at just 25 years old. Since striking out on his own as a hedge fund manager, Coleman has earned a reputation as a tech investor. Tiger Global reached its 20-year milestone with an average annual return of 21% net of fees. The S & P 500 returns an average of 10% per year over time. However, Coleman acknowledged his errors along the way. For example, Coleman regrets missing out on buying 4% of Chinese e-commerce giant Alibaba at a $250 million valuation. Alibaba now has a market capitalization of $633 billion. "There is an even longer list of companies we have sold too early – Facebook , Peloton , LinkedIn, Amazon , and Netflix to name a few – only to turn around and repurchase a fraction of the shares we previously owned for far more capital," Coleman explained. As of the fourth quarter of 2020, filings with the Securities and Exchange Commission show Amazon and Facebook in Tiger Global's top 10 holdings. The firm started in March 2001, right after the dot-com bubble burst. Since then, it has had to navigate the waters of technological improvements and public valuations. Coleman said this trend is only accelerating, as innovation floods everyday people's lives. He expounded on one of the firm's pillars: "Every moment is just a point in time, so it is essential to take note of the important things happening today that will seem obvious many years from now." Looking forward, Coleman told clients that the "future will see machine intelligence automate larger swathes of decision-making, increasing efficiency and further embedding digital systems in our daily lives." Most recently, Tiger Global has made big bets on ride-hailing giant Uber, Airbnb and Door Dash . Coleman noted to investors that a 20-year anniversary is a rarity for hedge funds on Wall Street. He said only about 1% of hedge funds surpass the two decade mark.

Chase Coleman, founder of Tiger Global Management LLC.

Amanda L. Gordon | Bloomberg | Getty Images

Hedge fund manager Chase Coleman revealed several mistakes he's made in the two decades he's headed Tiger Global, despite the firm's market-beating track record.

Coleman — protégé of legendary investor Julian Robertson — is reflecting on his time at the helm of Tiger Global, as the hedge fund reached its 20-year anniversary.