In this article, we discuss the 10 best investments of billionaire Peter Thiel. If you want to skip our detailed analysis of Thiel’s history and performance, go directly to the 5 Best Investments of Billionaire Peter Thiel.
Peter Thiel, the German-American entrepreneur who is one of the most successful investors in the United States with a net worth of over $5 billion, recently joined a new $100 million fund setup by SNO Ventures, a venture capital firm based in Norway. The fund aims to tap into the rich tech startup culture in Norway, Sweden, Denmark, Finland, and Iceland. Thiel, often referred to as the man with the golden touch due to his investment exploits, will provide the early stage companies that SNO invests in with growth and scaling advice.
Thiel has made a name for himself on Wall Street by investing in early stage companies with explosive growth potential. He was one of the earliest investors in Facebook, Inc. (NASDAQ: FB), the California-based technology company that owns several social media platforms. Facebook, Inc. (NASDAQ: FB) has now become one of the biggest companies in the world with billions of users spread across platforms like Facebook, Instagram, and WhatsApp. Thiel still serves on the board of directors of the company.
Another success story of the incredible career of Peter Thiel is PayPal Holdings, Inc. (NASDAQ: PYPL), the California-based payments company that the investor co-founded in 1998 and afterwards sold for $1.2 billion. PayPal Holdings, Inc. (NASDAQ: PYPL) is now a household name across the world as it has become the platform of choice for those wishing to make cross border transactions at low fees. The payments company has recently allowed users to checkout with cryptocurrencies as well, tapping into the digital currency market that will boost revenue.
In addition to other high-profile investments in companies like Stripe and SpaceX, both of which are expected to make blockbuster IPOs soon, Thiel is perhaps best known for his stewardship of Palantir Technologies Inc. (NYSE: PLTR), the Colorado-based big data analytics company that he co-founded in 2003 and afterwards helped go public, only stepping down from his role as chairman in 2019. Palantir Technologies Inc. (NYSE: PLTR) is now one of the most trusted names in the data analytics business and has even won the backing of the US government.
Besides his work in finance, Thiel also leads the Founder Fund, the Thiel Fellowship, and the Thiel Foundation. He is a New York Times bestselling author as well for his 2014 book titled Zero to One: Notes on Startups, or How to Build the Future. His investment philosophy revolves around sound financial principles, a focus on quality, and the recognition of the power of venture capital as a force for the good. Thiel is especially bullish on the fintech industry that has transformed the finance world in the past few years.
The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
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With this context in mind, here is our list of the 10 best investments of billionaire Peter Thiel. These companies were selected based on the returns they offered to Thiel on his initial investment, the name they have made for themselves since Thiel became associated with their brand, and the basic business fundamentals driving their earnings.
Best Investments of Billionaire Peter Thiel
10. Asana, Inc. (NYSE: ASAN)
Number of Hedge Fund Holders: 22
Asana, Inc. (NYSE: ASAN) is a company that operates a popular work management application. The stock has returned more than 83% to investors year-to-date. Asana went public through a direct listing in September 2020 and was valued at close to $4 billion on the first day of trading. The market capitalization of the firm has since grown to over $7 billion. Thiel led a Series B round of funding for Asana in 2012 through Founder Fund, his venture capital firm. He served on the board of directors for the firm before exiting in 2018.
Asana, Inc. (NYSE: ASAN) recently crushed market expectations on earnings per share and revenue for the first three months of 2021, raising guidance for the year ahead in the process. The company is placed tenth on our list of 10 best investments of billionaire Peter Thiel.
At the end of the first quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $374 million in Asana, Inc. (NYSE: ASAN), up from 18 the preceding quarter worth $323 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Asana, Inc. (NYSE: ASAN) is one of the best investments of billionaire Peter Thiel.
9. Lyft, Inc. (NASDAQ: LYFT)
Number of Hedge Fund Holders: 60
Lyft, Inc. (NASDAQ: LYFT) is a ride-sharing company with stakes in the food delivery business as well. The company’s shares have returned more than 63% to investors over the course of the past twelve months. It is ranked ninth on our list of 10 best investments of billionaire Peter Thiel. The investor was one of the earliest backers of the ride-sharing platform through the Founders Fund. Lyft has a market capitalization of over $19 billion and posted more than $2.3 billion in revenue last year despite the coronavirus crisis.
On May 4, Lyft, Inc. (NASDAQ: LYFT) missed market estimates for earnings per share in the first quarter of 2021 but beat on revenue. The company is expected to improve earnings in the second quarter as bookings improve following the vaccine rollout and the gradual reopening of the economy.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Alkeon Capital Management is a leading shareholder in Lyft, Inc. (NASDAQ: LYFT) with 5 million shares worth more than $321 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Lyft, Inc. (NASDAQ: LYFT) is one of the best investments of billionaire Peter Thiel.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Lyft, Inc. (NASDAQ: LYFT) was one of them. Here is what the fund said:
“New purchase Lyft, the No. 2 U.S. rideshare operator, is exclusively focused on the secular growth opportunity in the rideshare market and stands to be a direct economic reopening beneficiary. The company made tremendous progress on margins during 2020 and improved its ability to meet long-term targets. Lyft is also leveraged to the eventual transition to autonomous driving.”
8. Yelp Inc. (NYSE: YELP)
Number of Hedge Fund Holders: 20
Yelp Inc. (NYSE: YELP) is a company that operates a platform which connects users with businesses and uses crowd-sourced reviews to help the users make better choices. Thiel was one of the earliest funders of Yelp Inc. (NYSE: YELP), helping the company with seed money. Yelp went public in March 2012 and was valued at close to $1.5 billion on the first day of trading. The company has since doubled in market capitalization. It is placed eighth on our list of 10 best investments of billionaire Peter Thiel.
Yelp Inc. (NYSE: YELP) stock has returned more than 65% to investors over the past year. The share price of the firm jumped more than 2% in early May after it beat market predictions on revenue for the first quarter of 2021 and raised guidance numbers for the rest of the fiscal year.
At the end of the first quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $513 million in Yelp Inc. (NYSE: YELP), down from 31 in the previous quarter worth $527 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Yelp Inc. (NYSE: YELP) is one of the best investments of billionaire Peter Thiel.
7. Airbnb, Inc. (NASDAQ: ABNB)
Number of Hedge Fund Holders: 52
Airbnb, Inc. (NASDAQ: ABNB) operates an online platform for vacation rentals. Thiel was one of the earliest backers of the firm, reportedly in talks to invest close to $150 million in the company in 2012 that would have valued it at over $2.5 billion. Thiel eventually helped the firm go public in late 2020 at a valuation of over $47 billion. The company finished the first day of trading at a valuation of above $100 billion, setting an IPO record. It has since slid to $92 billion in market capitalization. It is placed seventh on our list of 10 best investments of billionaire Peter Thiel.
Airbnb, Inc. (NASDAQ: ABNB) stock has offered investors returns exceeding 11% over the past month. On May 25, the firm announced several upgrades to its platform in expectation of a travel boom following the reopening of the economy after more than a year in lockdown.
Out of the hedge funds being tracked by Insider Monkey, California-based investment firm Silver Lake Partners is a leading shareholder in the firm with 2.5 million shares worth more than $481 million.
Just like Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Airbnb, Inc. (NASDAQ: ABNB) is one of the best investments of billionaire Peter Thiel.
6. Zynga Inc. (NASDAQ: ZNGA)
Number of Hedge Fund Holders: 47
Zynga Inc. (NASDAQ: ZNGA) is a game developer that concentrates on marketing of social game services. The stock has returned more than 14% to investors in the past year. It is ranked sixth on our list of 10 best investments of billionaire Peter Thiel. The billionaire was one of the angel investors in the company back in 2011 before a blockbuster IPO that valued the firm at over $7 billion on the first day of trading. The company has since crossed $11 billion in market capitalization.
Zynga Inc. (NASDAQ: ZNGA) stock was upgraded to Buy from Neutral by investment advisory Bank of America on May 6 with a price target of $13.5. The shares of the social gaming company jumped close to 6% after the ratings update.
At the end of the first quarter of 2021, 47 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in Zynga Inc. (NASDAQ: ZNGA), down from 52 in the previous quarter worth $1 billion.
Just like Asana, Inc. (NYSE: ASAN), Lyft, Inc. (NASDAQ: LYFT), Yelp Inc. (NYSE: YELP), Airbnb, Inc. (NASDAQ: ABNB), Facebook, Inc. (NASDAQ: FB), PayPal Holdings, Inc. (NASDAQ: PYPL), and Palantir Technologies Inc. (NYSE: PLTR), Zynga Inc. (NASDAQ: ZNGA) is one of the best investments of billionaire Peter Thiel.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Zynga Inc. (NASDAQ: ZNGA) was one of them. Here is what the fund said:
“We also added to our position in Zynga. Our multiyear investment campaign in Zynga has been based on a new management team’s ability to drive steady growth in the company’s base portfolio of games, expand margins, reinvigorate the new game development pipeline and use its strong balance sheet to acquire complementary games and studios. Shares have been pressured in recent quarters, presumably because of investor concerns about the company’s moderating growth rate and Apple’s pending new privacy policy which will make it more difficult for Zynga to both efficiently acquire new players and sell advertising in its games. We believe the company has multiple growth levers it can pull in the periods ahead, including the rollout of new games, acquisitions, further penetration into international markets and entry into new gaming categories, to name a few. Furthermore, our research suggests the Apple privacy policy change is manageable for larger mobile game developers such as Zynga. Given our strong conviction in the profit cycle, we used recent weakness to add to our position.”
5. Twilio Inc. (NYSE: TWLO)
Number of Hedge Fund Holders: 99
Twilio Inc. (NYSE: TWLO) is a firm operating a cloud communications platform. It is placed fifth on our list of 10 best investments of billionaire Peter Thiel. The company’s shares have returned more than 67% to investors in the past twelve months. Thiel was one of the big names who invested in the cloud business when it was still in infancy. Thiel later sold off a majority of his stake in Twilio in 2018 amid controversy over his support for the presidency of Donald Trump that did not win him many friends in Silicon Valley.
On May 27, Twilio Inc. (NYSE: TWLO) stock was given a Buy rating by investment advisory UBS with a price target of $385, implying an upside potential of 14%, on the back of expected 30% revenue growth for the company for the next several years.
Out of the hedge funds being tracked by Insider Monkey, California-based investment firm SCGE Management is a leading shareholder in Twilio Inc. (NYSE: TWLO) with 2.7 million shares worth more than $948 million.
4. Spotify Technology S.A. (NYSE: SPOT)
Number of Hedge Fund Holders: 46
Spotify Technology S.A. (NYSE: SPOT) owns and operates one of the most popular audio streaming platforms in the world. Thiel invested in the company early on through his venture capital firm, Founders Fund. Spotify has a market capitalization of over $46 billion and more than $9.6 billion in revenue last year. It debuted on the stock market in 2018 and was valued at close to $30 billion on the first day of trading. It is ranked fourth on our list of 10 best investments of billionaire Peter Thiel.
Spotify Technology S.A. (NYSE: SPOT) stock has offered investors returns exceeding 9.7% in the past year. The company recently announced that it was launching a new live-audio chat feature called Greenroom to rival the dominance of Clubhouse in the space.
Out of the hedge funds being tracked by Insider Monkey, New York-based investment firm Tiger Global Management LLC is a leading shareholder in Spotify Technology S.A. (NYSE: SPOT) with 3.1 shares worth more than $852 million.
In its Q4 2020 investor letter, Guardian Fund, an asset management firm, highlighted a few stocks and Spotify Technology S.A. (NYSE: SPOT) was one of them. Here is what the fund said:
“At the current share price, Spotify basically only represents a fraction of the value they will be able to unlock in the growing market of audio entertainment. The key for Spotify is to change a variable cost base into a fixed cost base just like Netflix has. As the market share of the big labels, measured by the daily hours of engagement of the big labels, is declining, Spotify will be able to adjust its business model and create enormous operational leverage meaning that profitability will grow faster than expenses.
The music catalogue is not the business model. The value lies in the machine learning that drives discovery and engagement, the original content from people like Michelle Obama, Kim Kardashian, and Joe Rogan, the data analytics and distribution for artists, the direct and social relations artists can have with fans through music and videos. We believe that Spotify will be worth at least five times more in 2030.”
3. Palantir Technologies Inc. (NYSE: PLTR)
Number of Hedge Fund Holders: 32
Palantir Technologies Inc. (NYSE: PLTR) is a software company that focuses on big data analytics. Thiel was one of the founding members of the company and helped it to a public listing in September 2020. The firm was valued at close to $20 billion on the first day of trading. However, it has since climbed to more than $45 billion in market capitalization. Regulatory filings reveal that Founders Fund owned a 17.7% stake in the firm before the IPO. News platform Forbes estimated that Thiel directly owned an 8% stake in the firm worth close to $2 billion.
Palantir Technologies Inc. (NYSE: PLTR) is placed third on our list of 10 best investments of billionaire Peter Thiel. The company’s shares have returned more than 22% to investors over the past month.
At the end of the fourth quarter of 2020, 32 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in Palantir Technologies Inc. (NYSE: PLTR), down from 38 in the preceding quarter worth $1.9 billion.
In its Q4 2020 investor letter, Guardian Fund, an asset management firm, highlighted a few stocks andPalantir Technologies Inc. (NYSE: PLTR) was one of them. Here is what the fund said:
“In October, we bought a stake in Palantir. Earlier, in June, our concentrated Tech Fund, which has a mandate to also buy shares in the secondary market, bought shares of Palantir from insiders, before the direct listing. At the price we bought, the equity had much more upside than downside. Palantir is operating a software platform that functions as the digital infrastructure for data-driven operations and decision making. The software helps to structure and capture context in data of large corporations. Governments are increasingly realizing that they have to deal with serious data challenges and cyber risk. As most governments cannot attract the most talented software engineers, they need private enterprises such as Palantir to help them build solid infrastructure. Foundry, Palantir’s software for enterprises, is used by companiesto make safer cars and airplanes or to accelerate cancer research. The speed to bring new clients on board is improving and revenues will grow faster than expenses. Palantir has a long runway of growth ahead.”
2. PayPal Holdings, Inc. (NASDAQ: PYPL)
Number of Hedge Fund Holders: 143
PayPal Holdings, Inc. (NASDAQ: PYPL) is a payments company that facilitates cross-border transactions at low fees. Thiel was a founding member of the company that represents one of his most successful investments to date. PayPal was sold to ecommerce platform eBay in 2002 for $1.5 billion, a mere four years after it was founded. The company is ranked second on our list of 10 best investments of billionaire Peter Thiel. The stock has returned more than 65% to investors in the past twelve months.
PayPal Holdings, Inc. (NASDAQ: PYPL) stock has been sliding in recent weeks amid a broader bear market around crypto stocks. The firm recently announced that it would soon allow third party wallet transfers of Bitcoin in a bid to boost crypto transactions on its platform.
At the end of the first quarter of 2021, 143 hedge funds in the database of Insider Monkey held stakes worth $14.7 billion in PayPal Holdings, Inc. (NASDAQ: PYPL), down from 147 in the preceding quarter worth $15.9 billion.
In its Q4 2020 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ: PYPL) was one of them. Here is what the fund said:
“For the full year 2020, one of the top performers was PayPal, which we purchased in 2019, the company continues to take market share in digital payments and has seen an acceleration in user adoption and engagement, especially within their “silver tech” or older user demographic. We expect many more years of ongoing double-digit growth from their various business segments and new initiatives.”
1. Facebook, Inc. (NASDAQ: FB)
Number of Hedge Fund Holders: 257
Facebook, Inc. (NASDAQ: FB) is a technology company that owns and runs some of the most famous social media applications in the world. Thiel invested $500,000 in the company in 2004, gradually increasing his stake in the firm before making a handsome profit when he sold almost all of it for $11.3 million in 2020. Theil has been a long-time board member of the tech giant and still serves on it despite shedding close to 80% of his holdings in the company. The stock has returned more than 42% to investors in the past year.
Facebook, Inc. (NASDAQ: FB) is placed first on our list of 10 best investments of billionaire Peter Thiel. The company has been stepping up investments in virtual reality products in recent years, reportedly testing ads inside VR headsets it is said to be developing.
At the end of the first quarter of 2021, 257 hedge funds in the database of Insider Monkey held stakes worth $40 billion in Facebook, Inc. (NASDAQ: FB), up from 242 in the preceding quarter worth $38 billion.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Facebook, Inc. (NASDAQ: FB) was one of them. Here is what the fund said:
“We continued to keep our learnings from 2020 in mind during the quarter as we sought to increase the up capture of the portfolio. We also made adjustments to the portfolio’s top 10 holdings to increase the participation of select stocks, including Facebook, while trimming our weighting to stable names, which now represent 47% of the portfolio. Our repositioning has been encouraging so far with the portfolio performing better on up days in the market while maintaining good down capture during more turbulent sessions.”
You can also take a peek at Billionaire Stan Druckenmiller’s Top 10 Stock Picks and Billionaire Julian Robertson On Interest Rates and His Top Stock Picks For 2021.
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Disclose. None. 10 Best Investments of Billionaire Peter Thiel is originally published on Insider Monkey.
