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Wait until Paul Marshall of Marshall Wace takes control of the Telegraph.
Then their entire business news can be targeted at negative news about the companies they are short selling.
Solutions growth of 44% in 2023 makes it harder to get a similar figure in 2024 because of the law of larger numbers.
Also noticed that one of the weaknesses Ocado have is likely to be addressed.
Improved efficiency means they expect to start offering same day delivery
Some of the scepticism around the Ocado model in the industry is due to the adoption of in store picking and the operation of dark stores.
Certainly with the in store picking I don't think scale up to meet online growth is viable in the long run.
Issues with staff availability and cost (the high rate of sickness in the UK workforce and a future demographic decline in school leavers) the look and feel of fellow shoppers being supermarket staff or deliveroo staff with potential for in store conflicts over space or produce.
I mean if more Tesco shoppers switch to online resulting in more in store picking is that not likely to crowd out actual shoppers. Also there is a different mindset involved in an experienced staff member picking at maximum speed and a shopper wandering around browsing.
I think in store picking is a messy short term solution hence my preference for the more elegant Ocado model.
Sorry that was posted in error
The cases of Wincanton are Currys recently have shown how price discovery on the FTSE is broken.
The former has received 2 buyout bids that have doubled it's price from what it was trading at. Currys has also had a bid at a substantially higher price than what it was trading at.
So we can carry on marking to market or maybe be a bit more open minded about the value here.
A positive indicator this week was that Stripe updated it's value from 50bn to 65bn dollars. Still well down on it's 95bn high but something that can be read across to Revolut where we probably don't need to be cutting it's value in half.
I had a dream last night about the Isar Aerospace rocket taking off.
The cases of Wincanton are Currys recently have shown how price discovery on the FTSE is broken.
The former has received 2 buyout bids that have doubled it's price from what it was trading at. Currys has also had a bid at a substantially higher price than what it was trading at.
So we can carry on marking to market or maybe be a bit more open minded about the value here.
A positive indicator this week was that Stripe updated it's value from 50bn to 65bn dollars. Still well down on it's 95bn high but something that can be read across to Revolut where we probably don't need to be cutting it's value in half.
I had a dream last night about the Isar Aerospace rocket taking off.
Https://twitter.com/MoltenVentures/status/1759920909194785081
Yeah it's getting ridiculous now. Comparable small cap US tech stocks like Confluent, UI Path and the likes of Workday have also surged recently.
The moribund UK market is keeping this pinned down.
One of the former core companies Lyst I expected to go under but they seem to be doing better reporting £50m revenue for 2023.
Not a game changer but signs of solidity within the portfolio.
And I think core companies Iceye, Aiven, Coachhub, Thought Machine are close to breaking out.
Iceye are doing promo vids for selling multiple satellites for government contracts and they are about £10m a pop. On top of their most recent £100m revenue. And they are still not officially a unicorn.
There also must be some quality in the Forward portfolio. One of theirs, Robin AI raised last month with Temasek leading. I suppose Molten had to sit it out and got diluted but still a positive sign.
You could have the most valuable IP in the world but if you have no funds to exploit it....
Steph I have said this before.
Graphcore say they need 1bn to keep going until 2027 as that is when they hope to generate significant revenue.
Molten are unlikely to commit more as to play it would mean stumping up a lot of cash.
So if a raise at that scale took place it would wipe out Molten's position through massive dilution.
That is why Sequoia wrote it down to zero on their books.
Yep and he's off on a tour to promote it.
Nigel Toon gave up a while back and has spent the last 18 months writing a book, which he wouldn't have had time to do if he was busy running a successful business.
Steph, please Graphcore is dead. If it has no money their tech will be bought from the administrators.
The article has been generated by AI and offers no reference whatsoever for the claim that Graphcore is in a position to compete with Nvidia.
There are other companies in the portfolio that have much better prospects.
I also have a much better feeling about Coachhub. Their strategy was to go for big logo wins and it seems to be paying off with recent client wins like Amazon, Booking.com, easyJet, Virgin Atlantic, Cemex and Schneider Electric.
One of the biggest holdings is Aiven. The most recent NAV of 730 has them written down to a value of about 2.4bn dollars. This could still be a bit high but maybe not by that much.
They have a publicly listed comparator in Confluent. At peak bubble they were valued at close to 30bn but are now down to 8bn. This is on a multiple of about 12 of sales to price.
Both companies deliver data infrastructure services on the cloud, and cloud companies were battered a year or so back but cloud spend has been recovering fairly rapidly and their is an additional use case for their services involving streaming data from Generative AI.
Aiven posted revenue of 67m Euro for 2022 but this was almost double the previous year. So I think it's fair to assume 100m plus dollar revenue for 2023. So a multiple of 12 to that would give value of 1.2bn so contribute to a NAV of 365.
Confluent is still seen as suffering from market lack of confidence in small cap tech stocks. Once they break even they could get back over 10bn, which would again make Aiven's valuation seem a lot more realistic.
As would Aiven getting revenue closer to 200bn
Alas, most investment trusts hold listed equities so price discovery of the assets is a constant.
Here the valuations making up the NAV are based on funding rounds and comparisons with similar companies that are listed. So a much higher degree of subjectivity involved.
Other than Graphcore, which of the core portfolio companies do you see as distressed?
As for Graphcore I have said previously I expect this to be written down to zero. They will either run out of cash or be bought for pennies or the fundraise would be swerved by MV. They say they need a billion dollars for the next 2-3 years and I don't think MV have 50m to chuck at them, so their holding would be worthless due to massive dilution.
I suspect they were written down to about £10m at the interims as there was reference to a £30m write down from 2 companies.
Graphcore are regular tweeters but they have posted nothing since New Year, which is a long time for them to be quiet.
Maybe lights are off.
In
Funds typically vote stuff through even if they don't like it.
This stock is not exactly liquid. Dumping by the Border to Coast Pension fund and BG have caused a 15% drop.
There is a risk here because if the SP doesn't recover they would consider delisting it , especially if the price is vulnerable to a buyer.
That would render all the LTIP options worthless, which are currently massively underwater.