Tiger Global vs. General Catalyst: the future of private investment in fusion

Hedge fund titan Tiger Global Management carved out a reputation in the startup ecosystem for large checks and lightning-fast dealmaking. During the go-go years of 2021-2022 Tiger was known for closing deals in days rather than the months it might take a more traditional VC firm to run due diligence (Tiger instead outsourced some of its own due diligence to Bain & Company).

Tiger’s aggressive investment strategy reflected the exuberance of the 2021-2022 era, marked by low interest rates and a post-pandemic tech boom that fueled skyrocketing startup valuations and a surge in deal activity. Tiger’s recent pullback, then, could serve as a bellwether for broader shifts in venture capital investment, particularly in capital-intensive industries like fusion energy.

Tiger’s Big Fusion Bet

Tiger Global was a lead investor in Commonwealth Fusion Systems’ $1.8 billion Series B funding round in 2021—the largest private investment to date in the fusion energy sector. 

This funding supported the development of SPARC, the company’s compact high-field tokamak, and ARC, its commercial fusion power plant. Late last year, Commonwealth announced it would build the power plant in Chesterfield, Virginia. It’s worth noting that SPARC has yet to demonstrate net energy gain.

The long timelines and significant capital requirements for such ventures likely haven’t sat well with Tiger’s limited partners, especially as the firm’s investments in other industries have fizzled—Tiger’s 2021 fund currently reflects paper losses of -15%. 

Under pressure from LPs, Tiger Global has since revised its investment strategy. In 2024, the firm made only 24 new private investments, a sharp decline from the 315 startups it backed in 2021. 

Unsurprisingly, Tiger made no new investments in fusion technology in 2024.

A New Playbook for Investors?

Despite Tiger’s retreat, private funding for fusion energy hasn’t completely dried up. In fact, big deals are still happening—they’re just structured differently.

In October 2024, Pacific Fusion announced a $900 million Series A to advance its innovative pulsed magnetic fusion technology. This approach uses high-current pulses to magnetically compress and heat small containers of deuterium-tritium fuel.

This time, the lead investor, General Catalyst, adopted a more measured strategy.

As General Catalyst explained:

This statement indicates a growing awareness among investors of the technical challenges and massive investment needed to bring fusion energy to market. This milestone-based approach suggests a more thoughtful and sustainable path forward—and that could be a good thing.