Member Info for steph

Eu gas prices now nearly back down to pre invasion levels. Much lower than predicted. Oil prices down to pre invasion levels.

Some short term help for some bits of inflation index but impact deeper on supply chains that have a significant energy input which is a lot of food. Food during low energy cost cycles is about 4% to 5% energy cost (mostly electricity) but in a spike that can be 20%. So adding 16% onto food prices directly in a sike such as we had. That 16% can disappear although not quite as fast as it comes. Prices sticky on the downside.

Anyhow I'm expecting a clear inflection point shortly where the central banks start to slow down on raising interest rates earlier than the market prediction on their way to pausing any rises and then decreasing interest rates again.

Once this inflection point is clear our sector will fly as it was brought low by concerns of very high interest rates not business performance. If rates had gone up over 10% to battle inflation as they did in the late 70's then of course our sector would need the decrease, it had That is not going to happen though.

mike thanks for oakly comp

sector is now about stock picking and quality.

i think we have done better than sp indicates on that. great companies growing st a rapid clip and no need for fresh cash for at least 12 months (even without cash preservation) by which point they will be 70 % bigger.

“Flush with cash from recent boom times, unicorns have avoided down rounds and are extending financial runways by cutting costs. Serious damage has been limited to a small handful of companies, but Klarna's 85% valuation haircut earlier this year showed how tenuous these former valuations can be. For now, these companies are in a kind of limbo, increasingly shunned by the crossover investors they rely on for cash and unable to access public markets.”

Almost half of a very conservatively calculated NAV/share with further downside protection due to 90% preference shares.

The downside on this is modest and the upside massive.

Even a flat market will see these rocket based on sales growth of 70%. A recovering market and we will have a SP space launch.

https://investors.moltenventures.com/storage/uploads/PLC/Documents/FY23%20Interim%20Report%20-%20Molten%20Ventures%20plc_fgkwj.pdf

Worth looking at page 5 of presentation. Said they concentrate on growth stage for the most part and start exiting pre ipo through trade sales. Said uplift most intense in growth stage. Also less frothy I suppose as they do not go in late stage. It is not a fund that simply holds unlisted tech.

To fund themselves and through the lending facility needs of portfolio and new opportunities. Not expecting much by way of realizations in second half. Say they do most of their realizations trade and before IPO so that market may be there sooner rather than later.

90% preference shares and the example they gave is powerful. We are the best protected unlisted tech fund from a horrific company specific decline in valuation.

Edison report coming out in next few weeks. Hopefully this will contain some profits projections.

Auditors (KPMG) own independent review and of course the 150m borrowing facility reviewed independently the nav’s. No significant differences between these and Management.

Can by their own shares and would love to but not right now as can’t do so on the borrowed funds. Must be on realizations.

over 90% are preference shares.

lots of protection if further market declines.

https://www.lse.co.uk/rns/GROW/interim-results-1qjq6wnvlkhxziz.html

only interesting bits floated before.

60% + revenue growth of core 2022 and 70% plus projected for 2023. Really really fast and in tough market conditions.

We have preference shares that mitigate losses

most recent last round was above not below our March 31 NAV valuation. Maybe for our portfolio was no need for the circa discount of 30% applied to average portfolio last rounds so maybe some spare fuel in the tank going forward.

https://pitchbook.com/news/articles/why-some-investors-may-have-rose-tinted-glasses

https://www.telegraph.co.uk/business/2022/11/18/george-osborne-saddles-taxpayer-133bn-bill-accounting-trick/

One of the reasons BOE rate rises will peak earlier than market expecting. The can’t talk about it though.

Great portfolio. No lemons. Value of experts who manage seed funds and thus have enhanced visibility of the next big thing to stock pick at the A level.

Imagine what our SP will be the other side of this jittery market. We will rocket.

You answered your own question. A bit above trailing nav/share. THus rights issues not likely in this funny sub nav market.

Thanks fo rall the portfolio updates. I am impressed with our protfolio quality and find the reported average sales growth of 65% credible.

Yes

I had thought GROW (being based on private companies who’s valuations are based on infrequent last rounds and technical criteria such as multiples of sales) would be less not more volatile than the market. Now we know that under certain market conditions not so.

IN the long run we should have a certian stability around a credible NAV/share. Given our impossible to buy portfolio, unique seed funds and fast growth of NAV/share we should trade long term at a premium to NAV/share based on growth potential and the uniqueness of buying that growth.

Our NAV/share right now significantly discounted from the last round valuations -many of which were in this poor market. Therefore future organic growth of the portfolio companies plus a revaluation upwards when the general market improves some time in the next 2 years (maybe earlier) we are due a huge NAv/share upgrade. Then IPO’s will be back in the frame and a lot of delayed exits and thus hard cash realizations will happen. .

That is why I say 20 quid in 36 months. It is lower than we would have been without this market crash so prices in some long term damage to our sp of our and the sector’s newfound volatility.

Generally we go up on results but when around the results varies. Sometimes drift up before results, sometimes after.

We have had a sharp rise so some profit taking creating minor retraces and some daily volatility. I expect we will be up nicely Monday from here. Then over the following days get into the 5 to 6 quid trading range and then stay there for a bit.

Crypto has many fault-lines. Biggest for me is energy cost of creating new bitcoin. Nearly equals current value. That is not sustainable both as a business model and environmentally.

Some day some central bank will issue a government backed crypto. Maybe china. That has interesting possibilities. They could issue as a % of GDP -which is effectively what actual money is. Issue (allow banks to issue credit beyond deposits) too much relative to GDp and it crashes. Issue too little and your exchange rate goes up to much.

Great portfolio. Ironic ledger can benefit from FTX collapse.

I said it at 2.4 and I’ll say it again at 4.7. We are heading for a trading range of 5 to 6 quid (2/3rds conservative NAV) by next week when we will have final half year results. Then upwards only as the general market improves due to decreases in inflation taking pressure off interest rates and then a GROW specific boost with our year end results in may. I expect the panic on valuations will be mostly over and our conservatively calculated NAV will start looking a bit overdone on the downside.

I think we will get back to 11.8 within 18 months and 20 quid by 36.

Monday 21 November

Molten Ventures PLC Half Year Results

Great portfolio. Significantly better than sector averages.