Q4 2020 SuRo Capital Corp Earnings Call
Please standby.
Good day, ladies and gentlemen, and thank you for standing by.
Come to Sue ROE capital fourth quarter, and fiscal year, 2020 earnings call.
During today's presentation Wednesday March 10th 2021, all parties will be on listen only mode. Following the presentation. The conference will be open for questions.
This call is being recorded today.
I will now turn the conference over to todays Speaker clear Council of Zero capital. Please go ahead.
Thank you for joining us on today's call I'm joined today by the Chief Executive Officer of Zero capital, Mark Klein and Chief Financial Officer, Alison Greene. Please note that a slide presentation and that corresponds to today's prepared remarks by management is available on our website at www Dot zero cap Dot com.
On the Investor relations events and presentations.
Today's call is being recorded and broadcast live on our website Www Dot zero cap of Dotcom replay information is included in our press release issued today.
This call is the property of zero capital and the unauthorized reproduction of this call and in any form is strictly prohibited.
I would also like to call your attention to customary disclosures and today's earnings press release regarding forward looking information statements made on today's conference call and webcast may constitute forward looking statements, which relate to future events or our future performance or financial condition. These statements are not guarantees of our future.
For me or future financial condition or results and involve a number of risks estimates and uncertainties, including the impact of the COVID-19, pandemic and any market volatility that may be detrimental to our business our portfolio of companies our industry and the global economy and.
And that could cause actual results to differ materially from the plans and Tianjin <unk>.
Mutations reflects it and or suggested by the forward looking statements actual results may differ materially from those and the forward looking statements as a result of a number of factors, including but not limited to those described from time to time and the company's filings with the SEC management does not undertake to obtain of two update except for.
Forward looking statements unless required to do so by law.
For the update obtain copies of share capital's latest SEC filings. Please visit our website at www dot share of cap dot com or the SEC's website and SEC Dot Gov.
Now I would like to turn the call over to Mark Klein.
Okay.
Thank you Claire.
We are pleased to share the results of <unk> Capital's fourth quarter 2020.
These are obviously unprecedented times and we're living through and society is facing tremendous challenges, we observe capital continue to thank the frontline workers and responders, who have put themselves and the risks throughout the COVID-19 pandemic.
And as the country is continuing to get vaccinated. We are hopeful that we are nearing the end it will depend on it.
I would like to begin by discussing how our portfolio has fared during the COVID-19 the pilot.
And 19 pandemic and how the highlight how a few of our larger positions and even experienced degrees of business acceleration during these uncertain times.
Conclude and hand, the call over to Allison Green for a brief financial overview.
At the conclusion of our remarks, we will open the call for questions.
Let's start with slide three.
This quarter sort of capital reported its highest dividend adjusted net asset value per share since September of 2015.
At December 31, 2020, net asset value was $15 and <unk> 14 per share inclusive close of the dividends paid during the quarter of 47.
This is an increase from $12 and 46 per share at September 32020, and and increased from $11 38 per share at December 31, 2019.
Net asset value totaled $302 million at quarters end compared to $253 million and the third quarter.
Consistent with our ethos to be shareholder friendly zero Capital's board of directors of valuation of our portfolio on an ongoing basis to determine dividends and.
As such on March 13th the Board declared a 25 per share dividend to shareholders. This follows our recent past dividends of 25 cents per share declared on January 26, 22 cents per share declared on December 16, and 25 cents declared on October <unk>.
Eight.
Please turn to slides four and five for a review of of notable developments and our investment portfolio and the fourth quarter and subject to year end.
Zero capital is top five positions as of December 31 were powered tier Coursera of course hero next door and Aussie media.
These are two of these positions accounted for approximately 73% of the investment portfolio at fair value.
As of December 31 of our top 10 positions accounted for approximately 89% of the portfolio.
Now I would like to discuss notable developments and a few of our largest positions for.
And I want to highlight our investment and talent here and our largest position.
On September 30th Volunteer executed the direct listing and began trading on the New York stock exchange and consistent with Powershares Lockup agreement, 20% of share zero capital shares were freely tradable upon the execution of volunteers direct listing as previously announced between late September or so.
Timber and early October we sold our entire unrestricted portion of volunteer our power of our culture of shares the.
The lockup on our remaining restricted shares expired on February 18th.
System with our view of monetizing our public Securities we sold our remaining position and pallet tier we sold these remaining shares and a volume weighted price of $26.72 for net proceeds of approximately $123 million and for our net and for a realized gain of approximately of 100.
And of $11 million. This represents an increase to our year and valuation of approximately $29 million for approximately $1.42 per share increase to our net asset value.
Our shares of Palin tier and aggregate have generated $135 million of net proceeds and.
And net real and realized gains of approximately $119 million.
We are pleased to have delivered this positive outcome for our shareholders.
Next I would like to note that our investments and online learning through our positions and Coursera and of course hero represent approximately one third of our investment portfolio.
For our recent media reports as well as earning reports for public online learning companies. It is Ed that the initial spike and online learning generated by the COVID-19 pandemic has continued into the school year.
We continue to believe the effects of the pandemic have accelerated a long term structural change and how education is being and will be consumed with the clear transition towards online learning.
On March 5th Coursera, our second largest position as of year and publicly filed its form S. One registration statement.
And as noted and Coursera perspectives coursera generated of approximately $294 million of revenues and 2020 of 59% increase from 2019 as of December 31, more than 77 million learners had registered on of course, there are to learn from more of the 200.
Leading universities and industry partners and thousands of offerings. Additionally, as of December 31 over 2000 of enterprises, including over 25 per cent of Fortune 500 companies, we're paying customers of course, the or for business for.
Finally, and addition to consumers and enterprises over 100 government agencies and organizations, we're paying customers of course theres offering for governments. We are excited for this next step and of course, there's journey, which marks significant progress since our initial investment in 2013.
Previously on July 17th coursework, Coursera announced raise of $130 million and series F financing. The round was led by any a Kleiner Perkins C group learned cabin.
We participated with our $2.8 million pro rata follow on investment.
The information and online publication reported the round valued of course, there at approximately $2 5 billion.
At year end, our valuation of course, our of course, our position. According to our heuristics was driven by debt financing route.
As reported and in August 2020 Tech Crouch article of course hero, our third largest position raised a new $70 million tranche of series B capital at a $1 1 billion pre money valuation.
This round of range of the total primary capital raise and of course hero of series B to $80 million. According to edge and edge surge report. This financing included investments from TPG Goldman Sachs and others.
For the report also indicates the of course hero has over 1 million subscribers, who each pay between 10 and $40 per month and the of course hero of suppressed surpassed $100 million and revenue last year.
Search previously reported in February the of course, there are of course hero and raised $10 million and the initial series B round led by New view capital at one point and $1 billion pre money valuation.
Due to the impact of the COVID-19, pandemic related Quarantines and school college closures with less in person student access to teachers or study groups students have increasingly turned to online learning supplements for their studies, including of course hero's online document library.
<unk> a key competitor of course hero noted and it's February earnings call. The COVID-19 has meaningfully accelerated its business in 2020 checks all of 67% annual subscriber growth and total revenue growth of 57%. We believe coursera has been capitalizing on the <unk>.
And long term trend towards low online learning. Additionally in October of 2020 Tech Crunch reported the of course hero had acquired symbol F.
And it provider of artificial intelligence powered calculator for students to solve complex math problems. The acquisition aims to further expand course hero has set of offerings to students.
Next door, our fourth largest position is an outstanding platform that serves over 270000 neighborhoods across 11 countries and is used by one and for households, and the United States. According to our February of 2021 and Wall Street Journal article demand for next door as Aksel.
<unk> during the pandemic.
Sarah Friar next door of CEO noted the next door has seen daily active users increased by 50% and 2020.
She continues to say local has never mattered more debt in the pandemic with neighbors turning to next door for help navigating school closures, making vaccine appointments and handling of the stresses of long time of Lockdown and stay at home.
Orders as a result, we believe next door has tremendous upside to continue to monetize its user base and the $161 billion of United States local advertising market.
As reaching local audiences through digital advertising channels has become one of the most important mobile marketing trends. We believe next door has reached the critical mass of users that is highly valuable to advertisers. Please.
Please turn to slide six.
Segmented by six general investment themes, the top allocation of our investment portfolio is education technology, representing approximately 35 per cent of the investment portfolio at fair value Big.
Big data and cloud was the second largest category representing approximately 34 per cent of the portfolio. Our marketplaces accounted for approximately 12% of our investment portfolio, our financial technology and services category of accounted for approximately 9% and of our social and mobile category accounted for.
8% over our portfolio at fair value.
Please turn to slide seven.
As previously discussed we have broadened our focus beyond our core equity strategy into private credit and it's the pre spec merger of pipes.
Since we first started the company we believed in the mob democratizing access to asset classes and specific investments generally unavailable to the public.
For the last few quarters, we have highlighted the stack asset class was growing by a record of about <unk>.
Last year, there were approximately 81 and a half a billion dollars of stacking of issuance and increase from just $13 billion and 2019 of.
According to stack research over 74, and $5 billion have been already been raised in 2021 to 232 Ipos.
There were 248 stack ipos and all of last year.
According to Goldman Sachs 43, spec deals have already been announced and the first two months of this year cash.
<unk> and research notes the 14 deals have closed through the same period.
Last year, and 90 deals were announced 55 of which had closed.
This represented an increase of 37 and announced in 2019 with 25 closing during the same year.
We have begun to see the impact of this trend and our existing portfolio on February 11th Rover, The zero capital portfolio cap of the company announced its plans to merge with Nebula Terrible acquisition Corp. The stack sponsored by true wind capital.
Part of the successful closing of the transaction of the combined entity will trade on the NASDAQ the transaction values of the combined company and an enterprise value of $1.35 billion and.
<unk> to provide $325 million of gross cash proceeds to the company. This.
This transaction, which includes a $50 million type values Rover and enterprise value that is over three times greater than our year and valuation.
We are excited by this potential transaction for Rover, which we believe has emerged as the leading online marketplace for the pet care.
Beyond our existing stack portfolio, we believe we can offer ongoing proprietary access to the spec asset class.
While the investors have the ability to buy back common shares and warrants and the open market. Most investors have no access to the other parts of the stack structure, such as founders equity founders' warrants for purchase agreements and pipes.
As broadly reported founders equity and warrants are viewed to be valuable and for the most part only stack sponsors and I've had the opportunity to benefit from them.
Additionally, as we have previously stated we equate the.
Pipe issuance and spec business composite combinations as similar to pre IPO investments.
According to stack research for 190 for specs are currently looking for companies to effectuate business combinations.
This translates into potentially hundreds and hundreds of pop of opportunities over the next couple of years.
And in effort to be a leader in this democratization we continue on.
Ongoing dialogue with sponsors and investment banks to expand our participation beyond pipes to include founders equity and foundries words as a result, we are excited to provide shareholders proprietary axes that we believe no other public.
Vehicle presently provides.
Two of this and we are excited to announce two investments.
In founder Economics, one is a 200000 dollar investment and Churchill capital six sponsor company and the second is the 300000 dollar of investment and Churchill capital seven sponsor company.
Please turn to slide eight.
Churchill capital six and Churchill capital seven for special purpose acquisition companies within the true Churchill capital Churchill capital has enjoyed success since its inception, beginning with Churchill capital once the merger with clarity and most recently the announcement of and anticipated merger between lucid motor.
And the Churchill capital for Churchill capital six is focused primarily on the high growth technology names and is led by operating partner Sam Altman, formerly the president of Y Combinator Churchill capital seven is focused on larger global opportunities.
By investing and the founder of economics of both Churchill capital six and Sherpa Churchill capital seven.
And we believe we could expect we would expect a meaningful return upon the successful completion of our merger and each spec.
We are of having ongoing dialogue with church of capital to not only to continue but also to expand our relationship. Additionally, we are in discussions with other sponsor teams to participate and their sponsor of economics.
To reiterate the stack market opportunity is broadly exciting excite. Furthermore, it is our opinion that we are extremely well positioned to take advantage of this market opportunity and we believe we can deliver value to our shareholders through this proprietary access.
Yes.
Beyond stacks, we continue to see of high volume of attractive opportunities across our core equity strategy. A few industries of focus include E Commerce, and retail financial technology, food technology, and transportation and logistics as such we are excited to announce it.
$7 million of equity investment and sugar and the enterprises.
Please turn to slide nine.
Sugar and also known as hard as the software platform that helps professional contractors to grow their businesses will make it easier for homeowners to finance home improvement projects. The Companys technology is currently focused on distributing unsecured consumer debt to homeowners and non discretionary non discretionary.
Homework pairs, including HV AC and roofing repairs, which have historically been financed through credit card debt, but the nature of contractors working away from a desk and computer screen and we believe contract has long been underserved by technology and software that can make their business more efficient and a better experience for their.
We were impressed by show of guns, differentiate and differentiated product offering and an ability to rapidly rapidly penetrate this large and unsaturated market. We believe show gun has significant upside potential and its existing contract of vertical as it broadens its product offerings include.
And by adding payments and insurance products.
Additionally, we believe there is a large opportunity for short run to expand into other verticals and which consumer consumers face large and unexpected non discretionary expenses.
Looking ahead.
And we're excited about the Corsair IPO, we believe that our portfolio remains well positioned to drive long term value.
Thank you for your attention and with that I'll hand, it over to Allison.
Okay.
Thank you, Mike I would like the biomarker update with the more detailed review of our fourth quarter activity and financial the adult as of December 31st Q1, 2020, one and Beckman activity recently declared dividend.
Recently announced the redemption of our four points of and 5% convertible senior notes due March 2023, and our current liquidity position first of all review our investment activity and new investments during the fourth quarter included the 10 million dollar investment and the series a and series C preferred shares of Blink health and the $4 5 million dollar and Batman.
And second Avenue comprised of $1.5 million and the series a preferred shares and $3 million and a secured term loans and second Avenue for you.
And the fourth quarter. We also completed follow on investments of $500000 and the convertible notes. The current portfolio of company enjoy technology and the total of $1 million and additional investment and the common stock of Green acreage of real estate Corp.
The quote here and we invested $7 million and the series B, One and series B two preferred shares of Shogun enterprise, the $200000 and share units and Werent and you get the Attritional sponsored say Hello.
I'll cede the sponsored vehicle for Churchill capital thick, and $300000 and share unit and more units of Churchill sponsors that and see the sponsored vehicle for Churchill capital start any day.
Thank you Langley I'll spend about the and an additional $500000 and additional investment and the common stock of Green acres and real estate Corp.
Please turn to slide 10.
And the fourth quarter, we continued to sell our unrestricted publicly traded class a common shares of talents here on September 30th 2020, how would your technologies Inc. Completed its IPO on the New York stock exchange under the ticker of P. L. P. R.
And I P O, 80% of our shares remain restricted and tell the lock up period expired on February 18, 2021 on the date of IPO, We sold 400000 shares or approximately 7% of or how is your holdings going into the IPO for a net realized gain of approximately $3 million during the fourth quarter, we sold the remaining 754000.
And 738 share of our then unrestricted shares for a net realized gain of approximately five point for millions of dollars subsequent to year end and once the remaining 80% of of our shares became unrestricted on February 18th 2021, We sold 4 million and 618952 were all remaining shares as of March for it to.
And in 'twenty, one sort of and net realized gain of 100, and and and a half million dollars.
In total we have realized approximately $118 $9 million and net gain some of our commentary on Batman not including sales made in prior years.
During the fourth quarter. We also received proceeds related to our June 2020, and button and commentary lending at the D. A.
As of year end.
$8 $7 million has been received and talent of our lending trust of C. D and the proceeds received part of your and your $86 $9 million. We paid the total outstanding principle of the note $800000 was attributed to the guaranteed and pet and $1 million was generated by the equity participation and underlying collateral as of December 31, two.
And in 'twenty and the balance of the loan and all guaranteed interest had been fully repaid.
Subsequent to year, and we received an additional one $4 million some commentary of lending at C D and ease.
The additional proceeds are attributed directly to the equity participation and the underlying collateral as of March 10, 2020, $10 1 million had been received some of the commentary lending towards the C. D and 812290 shares and the underlying collateral of two which we retained and equity interest remains the cold.
We are pleased to report we ended the fourth quarter and fiscal year 2020, with and any per share of $15 and 14th day.
The breakdown of NAV per share as of year end as shown on slide a lot and and it's consistent with our financial reporting and on the increase of NAV per share during the fourth quarter was largely driven by approximately $2 92 per share of net unrealized depreciation of our investment portfolio approximately 36 cents per share attributable to net realized gain on the sale of a portfolio.
And I went back net and approximately eight cents per share attributable to the repurchase of our common stock.
These increases to any of you.
Share were partially offset by 47 cents per share and dividends declared during the quarter and a 21 cents per share decrease attributable to net investment losses.
During the fourth quarter zero capital declared two dividends for a total of 47 per share and dividend on.
On October 28, 2020, our board of directors declared a 25 cent per share dividend paid on November 30 of 2020 to shareholders of record on November 10, 2000, and 'twenty and on December 16, 2020, our board of directors declared a <unk> 22.
Per share dividend paid on January 15, 2021 to shareholders of record on December 30 of 2020 the dip.
And declared and been categorized net long term capital gains for tax purposes.
And the related realized gains are attributable to the monetization upon the sale or exit of the investment and our portfolio.
Subsequent to year end on January 26, our board of directors declared a dividend of 25 cents per share paid on February 19 to shareholders of record on February 3rd and as Mark and out on March eight our board of directors declared a dividend of <unk> 25 cents per share payable on April 15th to shareholders of record on March 30th vs.
These 2021 dividends I expect it to be categorized as net long term capital gains for tax purposes.
And the related realized gains are attributable to the monetization on sale of at that and the investments and our portfolio.
On February 19, 2021, we caused notices of redemption to be issued for the holders of our for 75% convertible senior notes due 2023 regarding exercise of our option to redeem and hold the issued and outstanding for 75 per cent convertible senior notes due 2023 per cent. The indenture dated as of March 28, 2000 and.
The team between Us and U S Bank and I check the.
And the first supplement on indenture dated as of March 28, 2018 between us and USA and shut in.
And I'm up to 38 million and $215000 and aggregate principal amount of the issued and outstanding for 75 per cent convertible senior notes due 2023 on March 29, 2021, the redemption date, the for 75% convertible senior notes due 2023 will be redeemed at 100% of their principal amounts of <unk> thousand dollars per <unk>.
Plus the accrued and unpaid interest there on from September 30 of 2020 through but excluding the redemption date.
What are the 4.75 per cent convertible senior notes due 2023 Mesa render such notes for conversion into shares of the stereo capital common stock in lieu of receiving cash at any time prior to the close of business on the business day immediately preceding the redemption date. The current conversion rate for the for 75 per cent convertible senior notes due 2023 is.
108.0505 chairs and throw capital common stock for each $1000 and pull them out of such notes, which represents a current conversion price of approximately $9.25 per share.
A copy of the notice of redemption was included as an exhibit for the current report on form 8-K filed with the SEC on February 19th 2021. Please refer to that kind of report on form 8-K for additional information finally, I would like to review throw capital at the parent liquidity, we ended the quarter with approximately $144 million of liquid assets, including $45.
$8 million of cash and $94 $6 million of public security subject to lockup restrictions at that time.
Cash balance of $45 $8 million as of December 31, 2020 consisted primarily of proceeds generated during the third quarter 2020, and via the ATM offering and the monetization of various portfolio positions throughout the year.
And the $94.6 million of the public security subject to lockup restrictions held as of December 31st represent our share it in Poland for your technology is valued at the December 31st 2020 closing price of $23 and to just I've been like the day.
For lack of marketability related to the then current lockup provision.
As noted earlier beginning with the exploration of the lockup on February 18th 2021 and through March for 2021, we sold all of our remaining previously restricted shares for approximately 123 4 million and net proceeds realizing approximately $110.5 million and gains.
That concludes my comments, we would like to thank you for your interest and support of stereo capital now I will turn the call over to the operator for the start of the Q&A session operator.
Thank you if you would like the signal with questions. Please press star one on your Touchtone telephone.
If you're joining us today use a speaker phone. Please make sure of new function is turned off to allow your signal to reach our equipment for the interest of time. Please limit your questions to one thank you.
And our first question will come from Kevin and false with JMP Securities.
Good evening and thank you for taking my questions.
Firstly, the private credit strategy was launched just over a year ago and in that timeframe. You've made a few investments I know, it's still or Youre still early and growing that part of the business, but can you give us a sense of how you view the long term opportunity set of the private credit strategy and relation of the total portfolio.
Sure and thanks.
Thank you for your question as.
As we discussed I guess, when we first launched of our intent was to allocate up to 20 per cent of our portfolio to the strategy and.
And to review the strategy the strategy is basically and asset based lending strategy to emerging venture backed companies that would carry the significant coupon.
Dissipation.
We have as you said, we've done a couple of those investments.
We're actively and discussions with several of other of them. We believe that the opportunity set is being now is when we initially.
Launched it and we continue to do our diligence on the.
Multiple opportunities and we have and.
And I expect that over the next period of time, we'll be able to communicate that we have made other investments and that.
Bassi.
And once again, if you would like the signal with the questions. Please press star one.
And that is star one for questions, we'll pause for just a moment.
And our next question will come from Jon Hickman with Ladenburg and Thalmann.
Yeah.
Yeah, Hi, Mark Thanks for taking my questions.
I I'm not that familiar with the founder side of the backward.
But the the investments that you made and those two specs seem relatively small compared to what you usually do.
Can you elaborate on that.
Sure.
And without the evolving into it.
The long conversation.
About the stacks and stacks founder equity stock.
The stack sponsors of required to put up so probably about three or 4% of the capital that they raised debt or raise for their specs and for the there given what.
And what amounts to a 20% fully diluted share of the capital that's raised plus warrants and.
And those securities so.
The basic relationship is for every dollar of the sponsor puts up there is a multiple of value that's created in the and stack of sponsors shares and warrants on the multiple can range anywhere from seven or eight times amount of money they put up of up to something in excess of 10.
<unk>.
So all of the.
That is there is a reason why there's 500 stacks out there and looking for transactions because of the economics are very exciting to the sponsors and we.
We believe the.
We have the ability with not just Churchill and with others to help to participate and the posting of the founders capital for sponsors and then to be able to get Recoups at economics that are significant multiples of our initial capital on the.
On those two investments are obviously relative to the small given the size of our capital base, but as you can imagine. These these economics broadly are quite dear to sponsors and so each each opportunity that we have will be will be different in size and scope.
Who was the sponsor is and what the potential upside opportunity is with them.
As a reminder, if you would like the signal with questions. Please press star one again the star one we'll pause for just a moment as the signals.
And our next question come from Lance GAAP with one senior Island capital.
Yes. So hi, my question is about the dilute of the fact of the convertible debentures I would assume that it's not in the 15 14 and Navy as of 12, 31, 'twenty, but it will.
Will be taken into account during the March 31 quarter am I correct.
Yes, you are correct and Allison will give you a brief overview of the potential dilution that that the support and so were levels that we.
He said we issued.
You should just convert in 2018.
And what was.
The 20% premium to the stock price and at a premium tour of NAV.
And.
Our ability to borrow money at four and three quarters per cent and deploy the against the investment and said that we've had and to be able to generate that significant rate of return against the money. We think is a.
More than of a very strong offset.
And the fact that our converts are so deep in the money is because we've been so fortunate and that our portfolio of companies and perform the way they have but I'll switch and try to give you a better idea of what the potential dilution will be upon the conversion.
Right and thank you Mike.
And so essentially when we issued the the redemption notice we hired that currently of $38.2 million of.
Principal debt was currently outstanding I think.
And she got rid of it when we did have one conversion of a thousand notes or approximately a million dollars of principal the did convert at the previous on.
The conversion rate is the right now we have about $37 2 million of principal outstanding that could be.
Redeemed for cash and if not converted prior to which we anticipate will happen and it should be should that entire $32 million be requested to be converted pirates of the redemption and that that would end up and just over 4 million additional shares.
And our next question comes from Alex Paris, with Barrington Research.
Hey, guys. Thanks.
Thanks for taking my question congratulation on the strong finish to the year. It sounds like we got some things to look forward to in 2020, one eye of a couple of questions and I'll try to roll it up into one long question on specs.
Mark you mentioned your existing snack portfolio I was wondering if you could just kind of go over that with US I know you have excuse me ex 60, and southern and there what else is and there are.
And the pardon me of asthma.
So okay I'm sorry, Alex go ahead, and I didn't mean to do your compound question and I apologize no go ahead.
Alright, it Devin.
And then and then also of I think of this surge and snack ipos and could lead to opportunities like you described with Rover and other opportunities for liquidity events true for.
Zero and to that and would your methodology for of holding public equity and the.
And the Rover. The the same you know would you would you sell it as soon as Lockups expired.
And then lastly follow up questions of the founders equity and a typical stack IPL the money's not invested and two years, you'll get your money back and says the same thing with founders.
And that's it.
And so those are the so let me do.
I think I got all of the questions and try to write it down and so thank you.
Obviously with the fact that there's 490, some odd stacks looking for deals.
And is sort of a phenomenal number.
I think broadly and not specifically to our portfolio pretty much any company and that's either held and of venture capital portfolio or on our private equity portfolio has been a pro debt as the value of greater than $600 million has been approached by multiple specs at the.
This point and time I think there is there or not it's not that they're being just reached into by the specs there on every.
Every investment bank right now are effectively running sell side processes that they now of course back offs, and which they and by five 610 specs to compete for and asset so given where given that backdrop, obviously ARPA.
Portfolio is is going to be attractive for at least some of the names of our portfolio will be highly attractive.
To the spec community, which is good.
For our shareholders.
And so that's number one and secondly, Oh, our view is not going to change, we're not and the public securities holding business.
And one of buy and sell public equities, and we think that they can do it on their own and they don't need them.
US to do that so and the case of Rover once debt stack is is consummated the deal is consummated and whatever the lockup period associated with that we would treat that as if it was of traditional IPO the.
And that's I think that answers the broader questions specifically the founder of economics.
The the good news and the bad news for founders. The good news is the post some amount of money and if the effectuate a business combination the theres a multiple of the amount of money that is rewarded.
That they have that they end up with and the event. After two years that they are unable to source of business combination than their founders equity is worth nothing so.
It is it's it's not a risk with the trade for anybody for founders or the.
And our cases.
Decided to participate with foundries and that's why you do as we go about this process. We will clearly we'll evaluate not just the economic opportunity that may be presented to us, but who's presenting it to us and what we feel the likelihood that they had the ability to identify.
Of course, and complete a business combination with the company that can and should be public.
And as a reminder, if you would like the signal with questions. Please press star one.
And again net.
Star One if you would like to ask questions and we'll pause for just a moment how did the signals.
The next will be Lee alper with hammock investors.
Hi, I think you answered the question, but let me make it.
A little clearer.
So if a company goes public and you were.
Bill.
Just so as soon as you can as opposed to try to shoot for future we sell it.
Well, what we've said lay over the last probably 18 months or so.
We don't believe that our investors are paying us to hold public securities with that said so we're not long term holders of our private companies that go public once they go public. We've also said that we will not just randomly.
And our indiscriminately sell the shares, especially in and around lockup periods, there's usually a fair amount of volatility associated with those those shares. So we will try to be inter.
Intelligent and judicious about our monetization and do it over a period of time unless the opportunity provides us to accelerate debt. So we're not long term holders after after something goes public.
And typically but we are we try to be somewhat.
Judicious about how we execute our exit.
And once again, if you would like the signal with questions. Please press star one on your Touchtone telephone again the star one if you would like the signal with questions and.
And our next question will come from Eric how with Sky Capital Partners.
Hi, Mark and Alex and Thanks for taking my quick call.
Quick question in regards to Ah I think you've already covered it mark but the dollar 40 for the pound here.
The proceeds that is in addition to the year and the Navy correct. The 15 15 at year end.
That's correct.
Okay, Great. That's good and secondly, what the that'll be included and that will be included obviously in our Q on Q1 reported.
Exactly okay.
And secondly, with the upcoming dilution and possibly with the converts and is it Britain.
Any ongoing chat of increasing buybacks with the with the stock trading below and a b and as opposed to a continuously increasing the dividends quarter to quarter.
Yeah.
Well, a couple of things and as you probably.
No we have been active as.
The group retiring our share is when there's a significant discount to NAV.
Up until actually pretty recently before we pre released our numbers for stock had been trading at a premium to NAV the.
Stock has come down a little bit of him with the volume.
Until the the market and the volatility and uncertainty of what we did with our Pelletier shares. This is sort of the first time that on the market.
Communicated to the market, what we've done with their pelletier shares so the market and will have an opportunity to digest that and.
And whatever way and sees fit.
And additionally.
As of the Coursera of going public announcement was Monday I think it was last Friday. So again I don't know if that's fully understood by the public. So we are is.
Those who have been investing with us for a while now that we've been active in repurchasing one of the purchasing is the appropriate tool to enhance shareholder value. We've also been we tried to community dividends to our investors and returned capital of that way as a Ric we are required.
And to distribute.
Distribution gains and so we will continue to do that as well.
As a reminder, if you.
We'll go ahead and turn the conference back over to you and that does conclude the question and answer session.
Thank you and thanks for taking the time to participate in the call.
And our mines, we were very fortunate that our portfolio has been very much appreciated by the marketplace on the monetization and the gain and talented or who is the tremendous return.
For our investors we are excited about.
The direct.
Filing of Coursera, and where that may take that position, which is now our largest position and our portfolio. We also are excited about some of the names that we mentioned and some of the names that we didn't have the time dimension, we do firmly believe that the.
The democratization of access to specs is something that we can provide that is different and the etfs that are out there or individuals simply purchasing the spec shares or spec warrants and not having the ability to participate in the sponsor X.
Omics to participate and pipes to participate and other elements and we're really excited about that opportunity for our investors. We believe that that is untapped and the marketplace and the we can drive.
Turns.
If we if we move against that strategy and it.
Shortfall matter. So we truly appreciate all the time and all of the <unk> and the <unk> and your support and thank you very much and I hope everybody stays healthy. Thank you very much.
Thank you and that does conclude today's conference. We do thank you for your participation have and excellent day.