[aptimpropriety]

Stasis' logic is along the right lines - you need to think about it in terms of portfolio management strategy. Effectively, the manager is trying to switch as much of the gains of their fund from being taxed at 40% to being taxed at 15%. A decent explanation here: http://www.nicholasfunds.com/dividend_info.html

You're right that it won't be a large drop in the bucket. It's not news because it's a large drop in a bucket, it's news because its a valuation change on companies many here follow. Nonetheless, one could object to poor management if Fidelity didn't take this action, regardless of size.

Note - this only gets at the 'why now' part of the motivation. What it means for 1) their internal company valuations and 2) implications for shareholders without liquidation preferences is more interesting.

[maxerickson]

Can you explain the mechanism where it is a tax loss and show where Fidelity has used it? That sounds like a gotcha, but I'm genuinely curious if it is clearly the case that they can recognize a tax loss here.

I think the mark down mostly does two things. It allows Fidelity to honestly inform their customers what they hold, and it signals to the startups that things aren't necessarily going the way Fidelity would like to see them go.