Member Info for steph

Small decrease in nav/share. Basically a stability messaging. I like the 5% of core with runway over 24 months. Lots of salve grwoth but did not say specifically what that is. Cash position seems to be no borrowing yet as realizations exceeded spending.

No good reason to be less than 2/3rds of NAV/share or around 5 quid -even in this market. The minute the market improves a bit we will go to NAV/share pretty fast.

As soon as exit market reappears this will fly really high. Very low failure rate of core portfolio and smaller copanies progressing nicely and ready for funding rounds. When that market gets stronger.

I think they are done with bad news. I’m expecting update and future updates to be mildly positive on NAV/share.

When IPO market repairs itself we will really fly but for now catching up to 2/3rds of NAV/share a more realistic expectation over the next 6 months or so. .

Now unlikely until next week. Update later than normal. I hope it is verifying good news and not delaying bad news.

No profit warnings (and market not deteriorated while sales continue to grow of core portfolio) so I assume at least NAV neutrality. Maybe the upside surprise of a modest NAV/share upgrade. Market assuming further NAV/share downgrades or at least a long period of no NAV/share movement upwards. SO would not take much good news for this to fly.

Later than normal. I hope the delay is to quantify good news.

Https://www.telegraph.co.uk/business/2023/11/07/ftse-100-markets-news-house-prices-mortgages-latest/

Fintech hasn't had its funnest year — but perhaps the tables are turning. Klarna's reported its first quarterly profit in four years, Monzo's reportedly in talks to raise a big new round via a share sale and three veteran fintech bosses are setting up a new wealthtech platform.

Https://www.telegraph.co.uk/business/2023/11/06/bank-of-england-huw-pill-interest-rates-could-fall-election/

I think we overshot on the downside and are about to correct pretty rapidly. Even 2 hot wars are not going to hold us back unless they spin well out of the localized ares they are being fought. Indeed counterintuitively the loss of business confidence due to the uneasy geopolitics results in lower interest rates through the mechanism of slowing growth and thus central banks feeling the inflationary fight takes care of itslelt and start worrying about a recession (rate cuts and no QT),

I belvie we we excessively volatile on the downside (but will not be overly volatile on the upside) because we were a rare retail wrapper in a sector that most of our big investors hold the same assets in an illiquid form. Thus when they wanted to reduce exposure to teh sector (and move money into long dated bonds) they disproportionally sold us avergagin gdown their whole holdings and insensitive to the undervaluation of our retail trust. They figured quick violent wins on bonds outweighed the losses on us and was part of an overall strategy to reduce exposure to the sector anyway.

Will not be (nor have been) had an over valuation of GROW on the upside. When the same funds are building exposure to our sector they will move more judiciously and in any case GROW itself did not use the maximum valuations it could have during the 2001 peak. Saving something for a rainy day approach. We have suffered an excessive dip and are about to reap the rewards of patience.

Was usually first week in November. Any day now. Maybe NAV calculations especially fraught with technicalities as fewer core companies have had a recent solid price discovery of a recent funding round.

Was very concerned about sharp dip to 2.00 week before last and cheered by sharp rise to 2.60 last week. Movement up or down near a results usually indicates if the update will be helpful or not. A “buzz” or a “concern” feeling stimulates investors who are in contact with staff -informally of course.

I was hoping Graphcore would get some good news (fundraising completed to extend runway) ahead of results but same same. Lot’s of potential but only a trickle of actual sales. With that the valuation could be anything in a wide range. As they get closer to end of runway the value will drop regardless of future potential as risk of running out of funds to continue go up exponentially the closer to the end of the runway they get. Anyhow Graphcore only 37m of our portfolio so room for volatility there.

Can have one or two high risk high reward companies in a broadly based unlisted tech portfolio. If Graphcore “makes it” it will be worth many times the 37m on our books. If it does not it will have some liquidation value to someone as they have valuable staff teams and intellectual property.

Https://www.telegraph.co.uk/business/2023/10/04/giant-asset-price-crash-nobody-talking-about-bonds/?WT.mc_id=e_DM226997&WT.tsrc=email&etype=Edi_EIn_New&utmsource=email&utm_medium=Edi_EIn_New20231031&utm_campaign=DM226997

Amazing sensitivity for tiny changes in long term US interest rate expectations.

. I suspect that the net present value of 30 year bonds is very volitive. They move up or down by large amounts on relatively small changes in Central Bank rates. The same money that moves into and out of our sector also moves in and out of the long erm dated bond market where large short term profits can be made if to predict it correctly.

So our very long term nature which I thought erroneously as an economist would mean less volatility coudl mena hihg volatility as a chunk of our investors move money fast in and out while speculating on short term movements in net preset value of 30 year type bonds.

Bizarre but maybe true.

Anyhow as we went into this extreme dip on the back of rising long term bond rates we will come out on the reverse. Plus organic growth of our portfolio has been chugging away. Failure rates in sector slightly higher than 2021/22 but not unusually high historically. A few extra percentage fails is more than compensated by strong sales growth of the portfolio as a whole.

I’m gaining self confidence in my predictions that we will get back to our previous high within 24 months. A 4 year dip but a dip never-the-less not a permanent repricing. From there onwards and upwards at a 20 to 30% rate compounded. Great sector great managed selection within the sector.

Https://www.nytimes.com/2023/11/03/business/stocks-bonds-interest-rates.html?smid=nytcore-ios-share&referringSource=articleShare

Https://pitchbook.com/news/articles/ai-chips-semiconductors-startups-nvidia-vc

We should be getting an update on half yearly results any day now.

hoping ghat will help sp by solidifying evidence behind nav/share and forward guiding that it should start going up again if not immediately at least by next year .

Https://files.pitchbook.com/website/files/pdf/Q4_2023_PitchBook_Analyst_Note_The_Seed_Blip.pdf

Right now biggest black swans are war risk. Israeli risk of breakout higher than Ukraine but both hotspots that can spin outwards.

Must be tempting for Russia just to play spoiler and help arm Hamas but they are not and even if they wanted to hard to get any arms to Gaza.

Technically Russia could help arm Hezbalah in Lebanon though and might be doing as as we speak. In practice Russian fears islamic terrorism on it’s own soil and thus has been more cautions than USA to fund. Don’t forget USA funded Bin Laden and Taliban -which caused blowback to be sure.

Just one big mess and risky for us tiddler investors to be sure. If one is to stay fully invested one needs to have a decent price with enough upside to compensate for the elevated risk to be sure.

Https://www.mondaq.com/corporate-and-company-law/1376156/venture-equity-valuations-in-2023-from-darlings-to-dogs--part-two

FTSE 100 can also go to zero in a scenario that includes a surprise Communist Party of Britain registration in most seats and then a parliamentary victory and immediate nationalization of fall Uk registered companes without compensation.

Odds of happening 1/1,000,000 but possible. For my money I’ll stay invested.

Mike

well summarized. we all have to do our own probability assignment to those extreme outcomes. you know where my money will be.

Https://www.bloomberg.com/news/articles/2023-10-27/worst-october-in-five-years-is-chasing-stock-bulls-out-in-droves