Glen Kacher’s Light Street Capital Management is making money again after losses and redemptions last year wiped out 70% of the firm’s assets.
(Bloomberg) — Glen Kacher’s Light Street Capital Management is making money again after losses and redemptions last year wiped out 70% of the firm’s assets.
Its Mercury hedge fund gained 19.2% in the first quarter, while its Tungsten long-only fund rose 28.7% after both posted two years of double-digit declines, according to a person familiar with the matter.
The firm ended last year with $605 million, down from $2 billion at the end of 2021, after making wrong-way bets on tech, telecom and media companies.
A representative for Palo Alto, California-based Light Street declined to comment.
Stock hedge funds such as Light Street, Whale Rock Capital Management, Tiger Global Management and Perceptive Advisors all dropped more than 40% over the past two years.
Read more: Stock Hedge Funds Vaporize Billions With Another Year of Losses
Last year was particularly brutal, as rising interest rates pummeled tech stocks. Many of those holdings have rebounded in 2023, with the Nasdaq Composite Index gaining about 15%.
Five of Light Street’s six-biggest stock holdings at year-end rallied more than 17% in the first quarter, while its largest investment, Gitlab Inc., tumbled 25%.
The firm’s hedge and long-only funds — which jumped 9.2% and 10.6% last month, respectively — only trade equities, while Light Street’s Beacon funds make private bets.
The hedge fund plunged 54% last year and 26% in 2021, meaning it will need to gain 194% to recoup investor losses.
Read more: Tiger Global Posts 7.3% First-Quarter Gain After Humbling 2022
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