Member Info for steph

Thanks

Could not find in the Edison report your reference to 2.7x cash/NAV for trust pilot. Is this a generic assumption? Certainly bodes well for any new last round or IPO valuation as last trustpilot valuation was a sales multiple of peers average.

I really do think GROW have a business model and a market that can delivery 20% NAV/share increases into the foreseeable future and to do so in a sub sector that has high barriers to entry and no peer alternatives. Once the market prices that growth in we are in for a nice uplift on top of the 20% annually.

I think we are heading for a nice upside surprise on finals with regards to NAV/share and we should as a result jump into the mid to high 900's or so when released. Not bitcoin % increases but a lot less downside risk as well.

UK chancellor Rishi Sunak is expected to launch this week a £375m fund to invest in tech start-ups, while former European commissioner Jonathan Hill will report his findings after a review of UK listings rules to ensure London remains globally competitive.

https://uk.advfn.com/stock-market/stock-news/84454061/trustpilot-a-s-intention-to-float

Thanks
I suppose in common with all trusts we have a limit on the premium over NAV/share we can have regardless of the intrinsic value given by the "excess returns model", Slater, Graham or any other model that tries to bring forward future earnings above a "secure money" and/or sector average baseline to the present.

The limit of course is what those same investors can buy the same underlying assets for without us. That does not mean we would not be a stonking good buy even at that level just that the whole sub sector we operate in is a stonking good buy and there are thus other ways for investors to get access .

In the case of us retail investors there is no opportunity beyond another trust that holds the same private companies. None exist that have more than 20% or so overlap. Also none have the feeder funds we have. Basically for us tiddlers no way.

For large funds they can patriciate in the funding rounds of the underlying asset themselves directly. IN a rapidly appreciating market this can create a large arbitrage opportunity between last and a future round even for a large funds able to do that. Also no guarantee the private company will not make the last funding round the last round before IPO -so even the largest funds may not be able to buy directly into an opportunity pre-IPO. They would need in that instance go to the funds that own the underlying asset offering to buy them out pre IPO and that might be a lot more than the last funding round price. NAV doubling every funding round is pretty common.

They can in addition only imitate GROW's portfolio after GROW has made a move -not duplicate the whole of the ecosystem and pipeline knowledge GROW has. They can, thus, only be trailing parallel investors and thus might sometimes miss the more attractive buy in points of the earliest initial rounds.

Anyhow to make a long story short I'm very comfortable with SP being above trailing NAV/share between 70% and 100%. I'd get nervous if we overshot and went above 100% (which we have in the past which was followed by flat SP growth for a bit).

The analysts quoted seem to indicate a NAV/share of 800 by year end up from the NAV/share of 600 on the half yearly. So headroom all the way up to 12.00 to 16.00 over the next 12 months -until NAV/share is next upgraded when the headroom should go up.

We might always trade just a bit below 100% just because the market does not fully price in our unique niche but for my money I think we are underpriced (unlike some US tech) and gradual or rapid re-pricing will be on top of organic growth of NAV/share (which is booming right now anyway).

My target of 14.00 by July 2023 is pretty modest but will be life changing if it happens. My head says be patient. My heart says it might happen sooner than that.

SO for me add when I can up to 70% of trailing or expected NAV/share. Hold between 70% and 100%. And maybe reduce above 100%.

FEb 28 report mentions 2 analyists gave estimates of revenue used as inputs to report. Berenberg and Goodbody Stockbrokers.

Anybody know who are Goodbody??

thanks

Yes gives a fair value of 16.14. I expect the simply wall street repots are AI generated on available info so can make bloopers -like not noting that the broker recommendations of 6.60 is July 2020 in the middle of the COVID panic and best ignored if one has 2 recent broker Feb 2021 views. Forward revenue forecasts useful. Basically seem to expect the upwards earnings (that is NAV/Share growth) trajectory as if COVID did not happen continues with the COVID dip an aberration. Even that may prove too conservative because as the Edison report points out COVID accelerated trends that flatter GROW's portfolio.

I've penciled in 14.00 by end of July 2023 for no better reason than that is 10% from now to year end results and then 20% per year for 2 years all compounded. That is for all the reasons we have all discussed. Seems conservative to me ( Love to get 16.00 or more instead) but better to be surprised on the upside. No magic to July 2023 expect that I would like to do a reno around then.

http://www.privateequityvaluation.com/Portals/0/Documents/IPEV%20Special%20Valuation%20Gudiance%20-%2031%20March%202020.pdf?ver=2020-03-27-141010-720×tamp=1585318216714

tidbit that to my untrained eye look significant.

last bullet point on page 1 states that last round valuation however recent but pre covid may not be appropriate and that, therefore, the lower valuation based on crisis era multiple of sales should be used.

Of course post COVID last rounds are doing very nicely indeed so this precautionary approach was not needed. It may have baked in a bit of a low valuation in our last year end results that might get re-priced on top of organic growth. The two together might make for some juicy indeed year end results in July.

https://simplywall.st/stocks/gb/diversified-financials/aim-grow/draper-esprit-shares#summary

Trading at 47.5% below our estimate of its fair value
Earnings are forecast to grow 23.94% per year
Flawless balance sheet with high growth potential

1Executive Summary

Draper Esprit plc, formerly known as Ingleby (1994) plc, is a private equity and venture capital firm specializing in any stage in the lifecycle of a business from seed and series A stage, growth capital to pre-IPO investments, late stage, cross-stage investments, buyouts, PIPES, and also makes direct and secondary investments in portfolio companies. More Details

All 2 recent brokers above 900 and buys

I expect anouther upgrade on results in a few months.

If this ever dips to near 800 I’ll top up but for now all set to wait 2.3 years and my Target of 1400 for then

BERENBERG RAISES DRAPER ESPRIT PRICE TARGET TO 920 (750) PENCE - 'BUY'

nice

Jefferies giving us a 9.67 target gave some fund managers the cover they needed to add. It may have been holding back some for us to have overrun July 2020 broker guidance even though outdated.

Webinar today probably helping.

Thank you for your email regarding Draper Esprit’s investor Day. It is not possible to register to watch today’s event live, however we have added you to the list for the replay and will share that as soon as it becomes available.

Kind regards,

Harold Amoo
Analyst



1 Tudor Street
London EC4Y 0AH

can't seem to find a link to join or listen. On right now.

https://www.jupiteram.com/uk/en/professional/chrysalis-investments-limited/

see especially page 6 and the NAV/share dip we are also recovering from March 2020.

worth looking at FLib's recommendation of Chrysalis. Most similar to GRWO on the market but some key differences you either like or don't like.

1) more recent
2) Not the same feeder funds of Round 1's
3) half half split on core between EBITDA positive and negative. GRWO I believe is 100% EBITDA positive. This has advantages and disadvantages. GROW will turn down a future TESLA which was EBITDA negative for a long time. SO in this way MERC more adventurous and maybe with more upside but also more risk.
4) greater concentration in UK and USA than GROW who have a wider EU net.

Great rise today and after the traded tech sector has retraced.

I've taken profit on IAG and RR (great rise but not sustainable) and have trimmed my traded tech (Augmentum Fin Tech, arix, biotec trust, gb group, L&G ROBO Global,L&G battery Global,meridian crystalis, polar cap, scot m in trust ). SO I am now a bit more concentrated in GROW in relative terms. A bit over 90% now.

Even at 8.50 GROW still has a P/E average within it's core portfolio that is massively better than traded tech. I calculate around 8 based on extracting sales/share which is reported yearly and a once off statement of profit being 65% of sales on average. So still lots of hidden value.

Jefferies massive upgrade in target even ahead of year end results is good news. Berenberg and Peel Hunt should follow. at lest by year end. Maybe Numis and Liberum who have covered GROW in the past but not in 2020 will come back.

Reports of massive NAV/share upgrade of part of the core portfolio due to funding rounds all adds to the probability of a large NAV/share upgrade for year end -well beyond the 10% we need in the second half to have our 20% per annum increase.

As the Edison report pointed out in the decade before listing GROW achieved 20% pa NAV/share increases dipping to 15% for the 4 years while traded. I think that was pulled down by the COVID valuations and will bounce back. Indeed as GROW starts to scale up the opportunities to lead on rounds increases and thus cherry pick the best deals. Up to a point size should help returns. Economies of scale in evaluation of opportunities as well as being a lead VC gives negotiation power.

Jefferies raises price target to 967

I've trimmed a few IAG as think it has has a nice surge but harder slog from here. Still good long term hold but not as good as grow.

perhaps you are not particularly inclined to download a beauty influencer AGORA app. Anyway I don't have AGORA either. I am beautiful enough without the app and the influencers flogging products I don't need but happy to earn money off them all through GROW. Shallow lot.

Good on GROW for spotting the "quick win" opportunity. I don't want more than 10% or so of the GROW portfolio in this ephemeral area of apps leveraging social media but happy for GROW to take a measured punt.

I like best the part of GROW portfolio which is the upstream (AI, software architecture and ICT engineering) bit of the new trends and thus market rather than the downstream consumer end applications but a balanced portfolio across the whole of the new and emerging value chain great.

https://www.thetimes.co.uk/article/open-up-ipos-to-private-investors-treasury-told-gwsc2mmdd

https://draperesprit.com/news/draper-esprit-leads-5million-seed-round-in-beauty-influencer-platform-agora