Member Info for steph

as i recall we had very little cash . most was credit

so worst case we lost some cash it would be not strategic. disruption of ability to draw cash from revolving credit not likely long term if it was a 4 bank consortium.

we dipped all the way to 3.00 at 11

i think this traction overdone.

hard to know the impact on grow directly. probably minor. strangely svb lostits money on bonds not vc.

bigger impact is sector confidence hit. investors in sector already jittery so any sector specific bad news will cause outsized gyrations.

us tech flat so it is only vc affected by sentiment. is tech flat wile we are down from an already low base is a buy signal for me.

wish me luck.

https://pitchbook.com/news/articles/silicon-valley-bank-vc-startup-liquidity-problems

Bought a small number of shares just now. Wish I could afford more.

Revolut received a lst round valuation July 2021 of 33bn led by softBank. As a result the fair value of Revolut in GROW portfolio jumped from 20.4 to 91.3. However…

GROWS’s Revolut holding was cut in fair value from 91.3m to 64.3m between the 31 march 2022 figure and the September 30 2022 figure in the half yearly results page 17

It is unknown what the trim to last round was on the march 2022 annual report fair value calculation but was likely approximately 23%.

52% of GRow core shares valued at last round had between 15% to 89% discount with a weighted average of 25% (page 162, note 28) . Money-week December 31 2021 reported grow’s fair value of Revolut was 119m so by year end when GRWO in the annual repot stated a fair value of 91.3m there was a likely discount applied of 23%

So total discount was from 119 to 64 46.2 %in total. SO on our books Revolut has an implied value of approximately 18bn. Maybe not so silly given Revolut has been growing fast, is fintech and states they are in profit. Overall in this bad market fintech valuations have held the best and attracted VC the most. We may get pleasantly surprised with Revolut on the upside if there is a trade sale that makes transparent the actual current value. If they are in profit however modestly low chance of a new round but who knows.

https://www.thisismoney.co.uk/money/saving/article-11830763/So-Revolut-hit-surge-scams.html

Tricky area. If it does get the full banking license it will fly though,.

cazoo at 1/100th of its peak. how the mighty have fallen.

if i could buy id do so they seem to have cash enough to find a niche and hold it

I don’t think there is another recent share broker guidance in the ftse 250 that has a 143% uplift on current sp. they tend t be a cautious lot as no downside for underestimating direction of such a major change and a major downside for overestimating. We have often in the past overrun 12 month broker guidance as a result.

Either Berenburg are fools or we are due a major surge some time over the next 12 months. I’m with the surge.

Berenburg has a recent 2/21/23 target of 900. This is 143% above the sp on day of issue,

Historically we ahd Peel Hunt buy on 6/23/21 1014 which was 7% above same day.

Numis Securities add on 6/23/21 980 whic was 4% above sp on day

Jefferies buy 617 on 7/30/20 which was 30% above sp on day of issue.

So unusual that 12 month broker guidance beyond 30% above SP. Berenburg clearly believe that within 12 months this doom and gloom will lift and we will get to and surpass our current NAV/share.

Thanks sang

Revolut, the UK’s most valuable fintech company, has made its first annual profit, long-delayed results show.
The London-based firm reported a net profit of £26.3m for 2021 compared with a loss of £223m in 2020. Revenues nearly tripled to £636m.
Revenues from its foreign exchange and wealth division, which includes crypto trading, jumped more than eightfold to almost £350m. Revolut stole a march on most of its rivals when it pushed into cryptocurrency trading in 2017.
The company has been praised as a high-growth success story

We usually go up after some big trades even if not immediately.

Good revolut confirmed as in profit. They indicated that but nice to be solid. No burn rate or runway for them.

it is roughly 150m which is mostly the credit facility.
they seem to be slow now to deploy after a fast first half of 2022 -maybe in case a portfolio company needs to raise cash best to have dry powder . they had circa 300m cash at end of 2021 year so quite a bit recycled upstream after the 2021 lucrative exits

https://www.edisongroup.com/research/key-takeaways-from-the-2023-capital-markets-day/31991/

I’d be very surprised if we are only 5 quid by q4. We have already been 4.8 in November 2022 which was a much worse macro economic background than now. IN November 2022 it was thought possible that interest rates might go over 10% to bring inflation down. Now even in US 6% is considered worst case as inflation measured month to month already down to a stubborn tail of 5% or so. Nothing like the 70”s spike.

I was disappointed at the last inflation data in US. We may have high rates for longer than I’d hoped but they will peak out and start to drop -maybe start dropping by q4 2023 or maybe q1 2024.

As mentioned enormous dry power for tech VC’s waiting for the moment the market turns. they will try to anticipate the market turn so will happen when it does fast and furious. Trouble is nobody knows when. Could be weeks, months or a year or two. For my money I think it will start May 2023 but that is a month pulled out of the thin air.

In the economist article one of the most startling charts is the staggering volume of VC dry powder in 2022. even more then 2021 and way above historic trends. Just sitting on the sidelines waiting for the market to turn.

This will rocket on any solid sign of stability.

From our narrow selfish point of view growth of economy not that important.

Japanese p/e is 20 right now and uk 14.2.

In fact if we get a nasty recession the resulting drop in interest rates will make our SP go up. Much more sensitive to interest rates than the short term market for GRWO portfolio products and services. .

How the titans of tech investing are staying warm over the VC winter

https://www.economist.com/business/2023/02/26/how-the-titans-of-tech-investing-are-staying-warm-over-the-vc-winter

Our post IPO have crashed with the sector and late stage valuations marked down appropriately.

Seed funds are up though and we have a lot of that. Also our preference shares means we have not dipped as much as these market averages.

I do think our nav calculations more than account for the sector dip and no reason for our SP to be substantially below NAV/share and I expect we wil have a bit of nav/share growth on results in 2 months time.

I also think this winter will ease in 2023. the risk free interest rate has not shot up that much. It is on 10 year bond rates equal and in short term interest rates touch above 300 year old norms. It is no going much higher. 2024-25 may see drops below 300 year old norms again.

Seems us house prices are coming down fast. Trouble is the builders can’t cancel constriction in progress so construction jobs figures have a 12 month lag at least between riased interest rates and job losses in the construction sector.

Can’t stand Powell. His interest rate rises have at least a 6 month lag on jobs data so he is using the wrong KPI’s when looking at last month's jobs market. ECB and BOE can only diverge a bit from FED. Canada, Australia and NZ following suit. Only Japan plowing it’s own furrow which is one to watch.

https://tradingeconomics.com/united-states/inflation-expectations

If only the FEd would allow wage catch up before raising rate to cool the economy to induce a unwelcome recession this crisis would be starting to recede. Of course Biden stimulating fiscally while the FEd de stimulates at the same time quite confusing for markets. Thanks to Truss no such problem in the UK. Fiscal policy firmly complementary to high interest rates as we have no choice.