Fidelity Slows Private Tech Deals

Source: PitchBook

Fidelity Investments made fewer private tech investments this year in part because it couldn’t agree with companies over the level of their valuations, according to Andy Boyd, Fidelity’s head of global equity capital markets.

Fidelity had sought to invest at lower valuations that companies would not accept, Mr. Boyd told The Information in an interview this week. He was commenting on data from PitchBook, prepared for The Information, showing a 77% drop-off in overall mutual fund investments in private tech in the second half of this year, after a big increase in the second quarter. (See above chart.)

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Mr. Boyd, however, said he had not seen any unwillingness from companies to take Fidelity’s money due to public valuation disclosures, and that companies truly looking to be public in the next few years didn’t seem to be bothered by the prospect.

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“Some will need to grow into their valuation. There are others that will need to either come to grips with a down round, or I think there will be other opportunities.”