Q2 2025 SuRo Capital Corp Earnings Call
This call is being recorded and for the duration your lines will be on listen only however, like you will have the opportunity to ask questions. At the end of this can be done by pressing star one on your telephone keypad. If you require assistance at any time, Please press star zero and Youll be connected to an operator and you over to your host.
<unk> Li to begin today's conference. Thank you.
Yeah.
Thank you for joining us today on today's call I'm joined today by Chairman and Chief Executive Officer of sort of capital Mark Klein and Chief Financial Officer, Alison Greene. Please note that a slide presentation corresponding to todays prepared remarks by management is available on our website at www Dot zero cap dot.
Speaker #1: Welcome to the SURO CAPITAL's second quarter 2025 earnings call. My name is Ellen, and I will be your coordinator for today's event. Please note this call is being recorded and for the duration, your lines will be on listen only.
Speaker #1: However, you will have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad. If you require assistance at any time, please press star zero and you'll be connected to an operator.
Com under Investor Relations events and presentations today's call is being recorded and broadcast live on our website at Www Dot <unk> Dot Com information is included in our press release issued today. This call is the property of <unk> capital and the unauthorized reproduction of this call in any form is strictly prohibited.
Speaker #1: I will now hand you over to your host, Vidi Lee, to begin today's conference. Thank you.
I would also like to call your attention to the customary disclosures in today's earnings press release regarding forward looking information statements made in 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 performance.
Speaker #3: Awesome. Thank you for joining us today on today's call. I'm joined today by Chairman and Chief Executive Officer of SURO CAPITAL, Mark Klein, and Chief Financial Officer Allison Green.
Speaker #3: Please note that a slide presentation corresponding to today's prepared remarks by management is available on our website at www.surocap.com under Investor Relations. Events and presentations.
Future financial condition or results and involve a number of risks estimates and uncertainties, including the impact of any market volatility that may be detrimental to our business our portfolio companies our industry and the global economy that can cause actual results to differ materially from the plans intentions and expectations reflected in.
Speaker #3: Today's call is being recorded and broadcast live on our website www.surocap.com. Replay information is included in our press release issued today. This call is the property of SURO CAPITAL and the unauthorized reproduction of this call in any form strictly prohibited.
In or suggested by the forward looking statements actual results may differ materially from those in the forward looking statements as a result of a number of factors, including but not limited to those described from time to time in the Companys.
Speaker #3: I would also like to call your attention to the customary disclosures in today's earnings press release regarding forward-looking information. Statements made in today's conference call and webcast may constitute forward-looking statements, which relate to future events, or are future performance, or financial condition.
<unk> with the SEC management does not undertake to update such forward looking statements unless required to do so by law.
Speaker #3: These statements are not guarantees of our future performance or future financial condition or results, and ve a number of risks, estimates, and uncertainties, including the impact of any market volatility, that may be detrimental to our business, our portfolio companies, our industry, and the global economy.
10 copies of Cerner Capital's latest SEC filings. Please visit our website at www Dot Cerro cap dot com or the Sec's website at SEC Gov now I'd like to turn the call over to Mark Klein.
Thank you Willy.
Speaker #3: That can cause actual results to differ materially from the plans, intentions, and expectations reflected in or suggested by the forward-looking statements. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including but not limited to those described from time to time in company's filings with SEC.
The second quarter was a milestone quarter for Cerro capital as of June 30, we were proud to report a net asset value of $9 18 per share a 38% increase from the prior quarter and the largest increase since inception.
Exceptional growth was fueled by broad market recognition of the value being created by our AI focused investments. We believe this performance reflects the strategic foresight, we have maintaining companies of this innovation cycle.
Speaker #3: Management does not undertake to update such forward-looking statements unless required to do so by law. To obtain copies of SURO CAPITAL's latest SEC filings, please visit our website at www.surocap.com or the SEC's website at sec.gov.
For several quarters, we stated our belief that AI capital expenditures with continued to accelerate and that the IPO market would reopen and this quarter our belief in those trends was affirmed.
Speaker #3: Now, I'd like to turn the call over to Mark Klein.
Speaker #4: Thank you, Willie. The second quarter was a milestone quarter for SURO CAPITAL. As of June 30th, we are proud to report an net asset value of $9.18 per share of 38% increase from the prior quarter and the largest increase since inception.
<unk> IPO, coupled with its post IPO performance led the way.
Based on news reports open AI recently closed the second tranche of its landmark $40 billion financing round at a $300 billion post money valuation the largest private capital raise ever biotechnology company.
Speaker #4: This exceptional growth was fueled broad market recognition of the value being created by our AI-focused investments. We believe this performance reflects a strategic foresight we have maintained in backing the defining companies of this innovation cycle.
This second tranche was reportedly oversubscribed by approximately five times.
Speaker #4: For several quarters, we stated our belief that AI capital expenditures would continue to accelerate and that the IPO market would reopen and this quarter our belief in those trends was affirmed.
In the last 24 hours several publications <unk>.
Including the financial times, Reuters Bloomberg and the information have reported that open AI is also in discussions to conduct the secondary sale at a valuation of $500 billion.
Speaker #4: CoreWeave's IPO, coupled with its post-IPO performance, led the way. Based on news reports, OpenAI recently closed its second tranche of its landmark $40 billion financing round at a $300 billion post-money valuation.
Which would make it the world's most valuable private technology company.
Additionally, Camden is reportedly reportedly preparing for a secondary tender at a $37 billion valuation.
Speaker #4: The largest private capital raise ever by a technology company. This second tranche was reportedly oversubscribed by approximately five times. In the last 24 hours, several publications including the Financial Times, Reuters, Bloomberg, and the information have reported that OpenAI is also in discussions to conduct a secondary sale at a uation of $500 billion which would make it the world's most valuable private technology company.
<unk> that comes and stigma recently completed a highly successful IPO.
Underscoring the growing public market enthusiasm for design software platforms.
Columbia acquisition Corp, two completed its merger with grab again further building on our stack sponsors strategy success.
Now I would like to discuss each of these portfolio companies in more detail starting with <unk>.
Please turn to slide four.
Speaker #4: Additionally, Canva is reportedly preparing for a secondary tender at a $37 billion valuation. A development that comes as Figma recently completed a highly successful IPO underscoring the growing public market enthusiasm for design software platforms.
<unk> is the foundation for our AI thesis and zero capital's largest aggregate investments since inception.
In the weeks immediately following its IPO, we consistently publicly stated that <unk> was underappreciated in the public markets.
Throughout the second quarter, we saw a thesis in core we play out.
Speaker #4: Columbia Acquisition Corp, too, completed its merger with Grabagon, further building on our SPAC-sponsored strategy's success. Now, I would like to discuss each of these portfolio companies in more detail starting with CoreWeave.
The stock Cline price climbed over 200%.
And has remained well above its offering price.
<unk> share performance reflects continued investor conviction, which was powerfully validated by last week's earnings reports from Microsoft and meta both companies announced staggering capital expenditure plans dedicated to AI with Microsoft forecasting a record 30 billion.
Speaker #4: Please turn to slide four. CoreWeave is the foundation for our AI thesis and SURO CAPITAL's largest aggregate investment since inception. In the weeks immediately following its IPO, we consistently publicly stated that CoreWeave was underappreciated in the public markets.
And capital expenditures for the current fiscal quarter.
And net of raising the bottom end of its full year spending range by $2 billion 66, and <unk> $72 billion to support its own AI roadmap together without Amazon alphabet. These four companies are set to spend nearly $400 billion. This year on capital expenditures.
Speaker #4: Throughout the second quarter, we saw our thesis in CoreWeave play out. The stock price climbed over 200% and has remained well above its offering price.
Speaker #4: CoreWeave's share performance reflects continued investor conviction which was powerfully validated by last week's earnings report from Microsoft and Meta. Both companies announced staggering capital expenditure plans dedicated to AI with Microsoft forecasting a record $30 billion in capital expenditures for the current fiscal quarter.
Historic wave of investment underscores the immense demand for GPU compute affirming <unk> critical position as a leading provider in the long term value of its differentiated relationship with Nvidia.
As previously stated it is our customary practice to begin monetizing monetizing our investments once portfolio companies become public and our shares are freely tradable.
Speaker #4: And Meta raising the bottom end of its full-year spending range by $2 billion to between $66 and $72 billion to support its own AI roadmap.
During the quarter, we sold approximately 40% of our initial <unk> investment generating $25 3 million in net proceeds and a $15 $3 million in realized gains.
Speaker #4: Together with Amazon and Alphabet, these four companies are set to spend nearly $400 billion this year on capital expenditures. This historic wave of investment underscores the immense demand for GPU compute, affirming CoreWeave's critical position as a leading provider and a long-term value of its differentiated relationship with NVIDIA.
This partial monetization represented significant liquidity event for our shareholders.
We continue to hold the majority of our position.
Which we have marked at a material discount to the quarter end trading price due to non registration fees, we remain highly optimistic about the company's future trajectory.
Speaker #4: As previously stated, it's our customary practice to begin monetizing our investments once portfolio companies become public and our shares are freely tradable. During the quarter, we sold approximately 40% of our initial CoreWeave investment generating $25.3 million in net proceeds and a $15.3 million in realized gains.
In addition to the sale of a portion of our core we've investment we fully exited our investment in service tightened for a significant realized gain of approximately $6 million.
In light of these gains in our core our current liquidity position as previously announced our board of directors declared a cash dividend of <unk> 25 per share paid on July 31 to shareholders of record as of July 21.
Speaker #4: This partial monetization represents a significant liquidity event for our shareholders. We continue to hold the majority of our position, which we have marked at a material discount to the quarter-end trading price due to non-registration fees, we remain highly optimistic about the company's future trajectory.
Based on current portfolio activity and subject to board approval, we intend to announce additional distributions throughout the remainder of the year.
Please turn to slide five.
Speaker #4: In addition to the sale of a portion of our CoreWeave investment, we fully exited our investment in Service Titan for a significant realized gain of approximately $6 million.
Transitioning to open AI.
But AI has firmly established itself as the most transformative technology company in private markets.
As mentioned earlier based on news reports open AI recently closed the second tranche of its landmark $40 billion financing round and a $300 billion post money valuation the largest cap private capital raise everybody a technology company in the last 24 hours several publications, including the financial times.
Speaker #4: In light of these gains, and our current liquidity position as previously announced, our board of directors declared a cash dividend of 25 cents per share paid on July 31st to shareholders of record as of July 21st.
Speaker #4: Based current portfolio activity and subject to board approval, we intend to announce additional distributions throughout the remainder of the year. Please turn to slide five.
The information I have reported that open AI is also in discussions to conduct the secondary sale at a valuation of $500 billion.
Which would make it the world's most valuable private technology company. This comes as the Companys traction with users has scaled at an astounding pace. According to the same source open AI is now generating over $13 billion in AI.
Speaker #4: Transitioning to OpenAI, OpenAI has firmly established itself as the most transformative technology company in private markets. As mentioned earlier, based on news reports, OpenAI recently closed its second tranche of its landmark $40 billion financing round at a $300 billion post-money valuation.
With projections pointing towards $20 billion by year end.
Okay.
Speaker #4: The largest cap private capital raise ever by a technology company. In the last 24 hours, several publications including the Financial Times, Reuters, Bloomberg, and the information have reported that OpenAI is also in discussions to conduct a secondary sale at a uation of $500 billion which would make it the world's most valuable private technology company.
According to the information open AI now has approximately 700 million weekly active users across its chat GPT products up from $500 million in late March.
This scale is unprecedented and I will just scores open AI has unique ability to commercialize cutting edge research at a speed rarely seen in software or platform technology.
Speaker #4: This comes as the company's traction with users has scaled at an astounding pace. According to the same source, OpenAI is now generating over $13 billion in ARR with projections pointing towards $20 billion by year-end.
Opening is remarkable growth has been supported by new enterprise features CPT for business and deep research as well as continued enhancement to memory capabilities and a gentex function functionality.
And both of usage and revenue perspective opening I remains the clear leader in generative AI and we believe zero capital is one of the only ways investors can gain exposure to this revolutionary and transformative technology company in the private markets.
Speaker #4: According to the information, OpenAI now has approximately $700 million weekly active users across its ChatGPT products up from $500 million in late March. This scale is nearly unprecedented and underscores OpenAI's unique ability to commercialize cutting-edge research at a speed rarely seen in software or platform technology.
Moving to move continues to reinforce its leadership and performance and health technology.
Speaker #4: OpenAI's remarkable growth has been supported by new enterprise features including ChatGPT for Business and Deep Research, as well as continued enhancement to memory capabilities and agentic functionality.
With the recent launch of five O and the MG variant long duration battery life enhanced sensing for EKG in blood pressure and novel software analytics, including health span, scoring and new page page.
Speaker #4: In both the usage and revenue perspective, OpenAI remains the clear leader in generative AI, and we believe SURO CAPITAL is one of the only ways investors can gain exposure to this revolutionary and transformative technology company in the private markets.
These tools are not only used by elite athletes, but by military special operation Fortune 500 wellness programs.
This enthusiastic easiest and clinical research away.
These hardware and software enhancements underscores whoops differentiated approach lending hardware health coaching and subscription monetization.
Speaker #4: Moving to WHOOP. WHOOP continues to reinforce its leadership in performance and health technology. With a recent launch of WHOOP 5.0 and the MG variant, WHOOP now offers long-duration battery life enhanced sensing for EKG and blood pressure, and novel software analytics including health span scoring and WHOOP age.
According to SNS insider, the wearable fitness technology market.
<unk> 7 billion in 2032 up from approximately $15 billion in 2024, reflecting the powerful tailwind supporting demand for preventative health tools that combine <unk> robust analytics with personalized insights we remain confident in our.
Speaker #4: These tools are not only used by elite athletes but by military special operations, Fortune 500 wellness programs, fitness enthusiasts, and clinical research alike. These hardware and software enhancements underscore WHOOP's differentiated approach blending hardware, health coaching, and subscription monetization.
<unk> and are excited to continue as long term investors and what we see as a uniquely positioned playable player in the wearable health space.
Please turn to slide six.
Turning to Columbia acquisition Corp, two and June Colombia completed its merger with Metroplex trading the parent company of grabbing done this transaction marks an important milestone in our spec sponsored strategy and validates our ability to source and execute unique off.
Speaker #4: According to SNS Insider, the wearable fitness technology market is projected to reach $37 billion in 2032 up from approximately $15 billion in 2024, reflecting the powerful tailwind supporting demand for preventative health tools that combine robust analytics with personalized insights.
Opportunities outside of traditional investment channels.
With the addition of Donald Trump Junior to the board and strong consumer demand across the platform as.
Speaker #4: We remain confident in our position and are excited to continue as long-term investors in what we see as a uniquely positioned playable player in the wearable health space.
Is well positioned to succeed as a newly public company.
This.
This outcome is another testament to the success of our stack sponsor strategy.
Speaker #4: Please turn to slide six. Turning to Columbia Acquisition Corp, too. In June, Columbia completed its merger with Metroplex Trading, the parent company of Grabagon.
That which we established several years ago.
As with all our public positions, we will monetize our investments based on market condition and as lockup agreements expire.
Speaker #4: This transaction marks an important milestone in our SPAC-sponsored strategy and validates our ability to source and execute unique opportunities outside of traditional investment channels.
Moving onto Camber canvas continues to build on its position as a category defining digital communications platform.
It has expanded its visual suite introduced new AI powered design tools and maintained strong expertise traction. According to several industry sources canvas is exploring a secondary tender offer at a 37 billion dollar valuation.
Speaker #4: With the addition of Donald Trump Jr. to the board and strong consumer demand across the platform, we believe Grabagon is well-positioned to succeed as a newly public company.
Speaker #4: This outcome is another testament to the success of our SPAC-sponsored strategy. Which we established several years ago. As with all our public positions, we will monetize our investment based on market condition and as lockup agreements expire.
If completed this would represent a meaningful uplift from previous private market valuations and reflects continued investor confidence in the company's long term. According to capital breathe canvas annual recurring revenue is now $3 3 billion.
Speaker #4: Moving on to Canva. Canva continues to build on its position as a category-defining visual communications platform. It has expanded its visual suite introduced new AI-powered tools and maintained strong expertise traction.
Up 50% since May 2024, with 240 million monthly active users. These updates come amid a constructive public market environment for design software companies last week Sigma stock more than tripled in its New York stock Exchange debut.
Speaker #4: According to several industry sources, Canva is exploring a secondary tender offer at a $37 billion valuation. If completed, this would represent a meaningful uplift from previous private market valuations and reflects continued investor confidence in the company's long-term potential.
Valuing the company at roughly a $50 billion valuation.
Good.
The blockbuster reception highlights the significant public market appetite for higher growth design software companies like Campbell.
Speaker #4: According to Capital Brief, Canva's annual recurring revenue is now $3.3 billion up 50% since May 2024, with $240 million monthly active users. These updates come amid a constructive public market environment for design software companies.
Please turn to slide seven.
Turning to our recent investment activity as previously announced during the quarter, we made a $5 million investment in Plaid through a sole limited partnership interest in $17 89 capital, Nevada to LP plant remains a foundational pillar of the.
Speaker #4: Last week, Figma's stock more than tripled in its New York Stock Exchange debut, valuing the company at roughly a $50 billion valuation. The blockbuster reception highlights the significant public market appetite for higher growth, design software companies like Canva.
Fintech ecosystem connecting over 12000 financial institution.
<unk> to more than 8000 digital apps with over 500 million linked accounts and over 100 end users globally. Our investment was part of <unk> $575 million financing led by Franklin Templeton Fidelity, NEA ribbon and others.
Speaker #4: Please turn to slide seven. Turning to our recent investment activity, as previously announced during the quarter, we made a $5 million investment in Plaid through a sole limited partnership interest in 1789 Capital Nirvana, to LP.
According to Tech Crunch, the round was completed at a $6 1 billion.
Post money valuation of <unk>.
According to CNBC see this financing is anticipated to be black clad latest.
Speaker #4: Plaid remains a foundational pillar of the fintech ecosystem, connecting over 12,000 financial institutions to more than 8,000 digital apps with over 500 million linked accounts and over 150 million end users globally.
Private financing before the company listed on the public markets.
According to pitch book this financing brings the total capital raised to date by plan to approximately $1 3 billion.
Well that is widely regarded as one of the most critical pieces of infrastructure in the U S financial data stack with an estimated two thirds of U S impacts of relying on its API network. According to Jpmorgan Plaid generated approximately 300.
Speaker #4: Our investment was part of Plaid's $575 million financing led by Franklin Templeton, Fidelity, NEA, Ribbit, and others. According to TechCrunch, the round was completed at a $6.1 billion post-money valuation.
In revenue in 2024 supported by consistent double digit growth in its core business.
Speaker #4: According to CNBC, this financing is anticipated to be Plaid's latest private financing before the company lists on the public markets. According to PitchBook, the financing brings the total capital raised to date by Plaid to approximately $1.3 billion.
New good new products that represented over 20% of our rating margins.
According to the same source.
<unk> is pursuing a more than $30 billion total a total addressable market across adjacent verticals, including real time payments alternative credit data.
Speaker #4: Plaid is widely regarded as one of the most critical pieces of infrastructure in the US financial data stack. With an estimated two-thirds of US fintech's relying on its API network.
Hello.
And fraud prevention reached.
Recent product launches such as plan protect our real time fraud intelligence system and plant transfer platform supporting bank payments across multiple rails highlights the company's ability to innovate a top its core infrastructure.
Speaker #4: According to JP Morgan, Plaid generated approximately $300 million in revenue in 2024, supported by a consistent double-digit growth in its core business. New products that represented over 20% of ARR and positive operating margins.
We believe pledged developer centric platform and expanding network effects effects position it to remain a category defining leader in open financed.
Speaker #4: According to the same source, Plaid is pursuing a more than $30 billion total addressable market across adjacent verticals including real-time payments, alternative credit data, and prevention.
Additionally, subject subsequent to quarter end, we made a $250000 in follow on investment in liquid debt. This investment follows reports of liquid debt will be entering the energy drink category with their first release anticipated in January the.
Speaker #4: fraud Plaid's developer-centric platform and expanding network of effects position it to remain a category-defining leader in open finance. Additionally, subsequent to quarter-end, we made a $250,000 follow-on investment in liquid debt.
Speaker #4: Recent product launches such as Plaid's Protect, a real-time fraud intelligence system, and Plaid Transfer, a platform supporting bank payments across multiple rails, highlight the company's ability to innovate atop its core infrastructure.
The new beverage will feature no sugar no artificial sweeteners added vitamins and what the company calls and unexplained caffeine level of 100 milligrams per can position for you alternative in a market increasingly saturated with hi, Catherine options. According to liquid desk energy drinks and the most common other.
Item in the physical and digital shopping baskets of liquid debt buyers.
According to the Wall Street Journal and Minto analytics better for you options will include some low sugar, but high caffeine drinks saw the biggest increase in consumption.
Speaker #4: This investment follows reports that liquid debt will be entering the energy drink category with their first release anticipated in January. The new beverage will feature no sugar, no artificial sweeteners, added vitamins, and what the company calls an unextreme caffeine level of 100 milligrams per can, positioning it as a better-for-you alternative in a market increasingly saturated with high caffeine options.
Larger estimated $24 billion energy drink category between January 23, and 24, we are excited to see liquid deaths continue to expand into new product categories and capitalize on creative collaborations.
Yes.
Speaker #4: According to Liquid Death, energy drinks are the most common other item in the physical and digital shopping baskets of liquid death buyers. According to the Wall Street Journal and Mintel Analytics, better-for-you options will include some low-sugar but high caffeine drinks saw the biggest increase in consumption in the larger estimated $24 billion energy drink category between January '23 and '24.
This is an exciting period for <unk> capital at quarter end, nearly a third of our investment portfolio at fair value was directly in AI infrastructure companies and Blue and we believe we are in the early innings of seeing these investments pay off.
With meaningful liquidity from our partial.
Sale and a full exit of service tightened accelerating capital expenditures the reopening of the IPO market and continued progress across key portfolio company opening camber and the successful completion of the Columbia transaction, we believe our portfolio is well positioned to creep.
Speaker #4: We're excited to see liquid death continue to expand into new product categories and capitalize on creative collaborations. This is an exciting period for SURO CAPITAL.
<unk> substantial long term value to our shareholders.
Speaker #4: At quarter-end, nearly a third of our investment portfolio at fair value was directly in AI infrastructure companies, and we believe we are in the early innings of seeing these investments pay off.
Yes.
Thank you for your attention and with that I'll hand, it over to Alison Greene, our Chief Financial Officer.
Thank you Martin I would like to follow Mark's update with a high level review of our investment portfolio at quarter end and a more detailed review of our second quarter financial results, including our liquidity as of June 30th I'll begin with a brief highlight of investment activity and portfolio company realizations during the second quarter and subsequent to quarter end and the investment.
Speaker #4: With meaningful liquidity from our partial CoreWeave sale and our full exit of Service Titan, accelerating capital expenditures, the reopening of the IPO market, and continued progress across key portfolio companies, including OpenAI, WHOOP, va, and the successful completion of the Columbia transaction, we believe our portfolio is well-positioned to create substantial long-term value to our shareholders.
Breakdown of our investment portfolio at the end of the second quarter based on the recently declared and paid cash dividend and our intentions related to distributions for the remainder of 2025, Please turn to slide eight slide.
Hey.
Speaker #4: Thank you for your attention and with that, I'll it over to Allison Greene, our Chief Financial Officer.
As Mark mentioned on April 4th we made an approximately $5 million investment in our class a common shares are flat to 17, 89 capital Nirvana Q L. P and SPD in which style capital Corp is the sole limited partner the $5 million does not include a 7% or $350000 origination fee paid at the time of investment and other capitalized cost.
Speaker #2: Thank you, Mark. I would like to follow Mark's update with a high-level review of our investment portfolio as of quarter-end and a more detailed review of our second quarter financial results, including our liquidity as of June 30.
Speaker #2: I'll begin with a brief highlight of investment activity and portfolio company realizations during the second quarter and subsequent to quarter-end, and the investment theme breakdown of our investment portfolio at the end of the second quarter.
<unk> auction Adil.
Additionally, we have prepaid and will continue to prepay expenses at the STB on an annual basis.
During the second quarter, we sold the entirety of our 220 Barney direct public common shares of <unk> for net proceeds of approximately $25 $3 million, resulting in a realized gain of approximately $15 $3 million.
Speaker #2: I will also include an update on the recently declared and paid cash dividend and our intentions related to distributions for the remainder of 2025.
Speaker #2: Please turn to slide eight. As Mark mentioned, on April 4th, we made an approximately $5 million investment in the Class A common shares of Plaid through 1789 Capital Nirvana to LP, an SPV in which SURO CAPITAL Corp is the sole ited partner.
Accident charges represented approximately 40% of our original initial aggregate $25 million investment in <unk>, alongside our $50 million investment in CW opportunity to L. P M.
CW opportunity to L. P as an SCB for which the class a membership interest is solely invested in our class a common shares of <unk> capital.
Speaker #2: The $5 million does not include a 7% or $350,000 origination fee paid at the time of investment and other capitalized costs of the transaction.
Capital is invested in the class a common shares of <unk> through its investment in a class a membership interest of CW opportunity to up here.
Speaker #2: Additionally, we have prepaid and will continue to prepay expenses of the SPV on an annual basis. During the second quarter, we sold the entirety of our $222,240 direct public common shares of CoreWeave for net proceeds of approximately $25.3 million.
The quarter end and to date, we continue to have exposure to <unk> through our investment in CW opportunity to our team.
During the quarter following the lockup release of our common shares in June we fully exited our position in service tightened by selling the 151515 common shares for net proceeds of approximately $15 $9 million, resulting in a realized gain of approximately $5 9 million.
Speaker #2: Resulting in a realized gain of approximately $15.3 million. The exited shares represented approximately 40% of our original initial aggregate $25 million investment in CoreWeave, alongside our $50 million investment in CW Opportunity to LP.
Okay.
Finally, subsequent to quarter end, we made a $250000 follow on investment in liquid Thats convertible note and note bears an interest rate of 4.12% and matures in June 2028. This brings our aggregate investment today and like what that to approximately $10 $3 million.
Speaker #2: CW Opportunity to LP is an SPV for which the Class A membership interest is solely invested in the Class A common shares of CoreWeave.
Speaker #2: SURO CAPITAL is ested in the Class A common shares of CoreWeave through its investment in the Class A membership interest of CW Opportunity to LP.
Speaker #2: As of quarter-end and to date, we continue to have exposure to CoreWeave through our investment in CW Opportunity to LP. During the quarter following the lockup release of our common shares in June, we fully exited our position in Service Titan by selling the $151,555 common shares for net proceeds of approximately $15.9 million.
I would now like to turn to our portfolio with quarter end, Please turn to slide nine.
Our top five investments as of June 30th where core we've open AI Columbia sponsored two and learning out these positions accounted for approximately 53 portfolio at fair value. Additionally, as of June 30th our top 10 positions accounted for approximately 76% of the investment portfolio. Please turn to slide 10.
Speaker #2: Resulting in a realized gain of approximately $5.9 million. Finally, subsequent to quarter-end, we made a $250,000 follow-on investment in liquid deaths convertible note. The note bears an interest rate of 4.12% and matures in June 2028.
Okay.
Doug mentioned by seven general investment themes, the top allocation of our investment portfolio at June 30, with the artificial intelligence infrastructure and applications, representing approximately 33% of the investment portfolio at fair value.
Speaker #2: This brings our aggregate investment to date in liquid death to approximately 10.3 million. I would now like to turn to our portfolio as a quarter-end.
Financial technology, and services and consumer goods and services over the next two largest categories with approximately 17% and 16% of our portfolio are effectively.
Speaker #2: Please turn to slide nine. Our top five investments as of June 30th were CoreWeave, OpenAI, WHOOP, Columbia-sponsored, too, and Learnio. These positions accounted for approximately 53% of the investment portfolio at fair value.
14% of our portfolio was invested in software as a service and education technology companies accounted for approximately 10%.
Speaker #2: Additionally, as of June 30th, our top 10 positions accounted for approximately 76% of the investment portfolio. Please turn to slide 10. Segmented by seven general investment themes, the top allocation of our investment portfolio at June 30th was to artificial intelligence infrastructure and applications, representing approximately 33% of the investment portfolio at fair value.
Logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio and thorough capital sports accounted for approximately 2% as of June 30th Please turn to slide 11.
We ended the second quarter of 2025 with a net asset value of approximately $219 4 million or $9 18 per share, which is consistent with our financial reporting. This compares to an NAV at $6 66 per share as of March 31, and $6 68 per share as of year end 2024.
Speaker #2: Financial technology and services, and consumer goods and services, were the next two largest categories with approximately 17% and 16% of our portfolio, respectively. 14% of our portfolio was invested in software as a service, and education technology companies accounted for approximately 10% of the fair value of our folio.
Increase was driven primarily by valuation appreciation and several of our top positions and realized gains from the sale of a portion of our call. We didn't last that more specifically the increase in NAV per share from <unk> 66 cents at the end of the first quarter was primarily attributable to a $1 88 per share increased driven by the net unrealized depreciation of our investment portfolio.
Speaker #2: The logistics and supply chain category accounted for approximately 8% of the fair value of our portfolio, and SURO CAPITAL Sports accounted for approximately 2% as of June 30th.
Speaker #2: Please turn to slide 11. We ended the second quarter of 2025 with a net asset value approximately $219.4 million, or $9.18 per share, which is consistent with our financial reporting.
During the second quarter, and an 89% per share increase due to net realized gain on sale of investments during the second quarter.
Increases were offset by a <unk> <unk> per share decrease due to net investment loss and <unk> per share decrease from the impact of stock based compensation during the quarter our corner.
Speaker #2: This compares to an NAV of $6.66 per share as of March 31st, and $6.68 per share as of year-end 2024. The increase was driven primarily by valuation appreciation and several of our top positions, and realized gains from sale of a portion of our CoreWeave investment.
June 30th and currently there are $23 million 888107 shares of the company's common stock outstanding.
Our liquidity as of quarter end, we ended the quarter with approximately $52 $4 million of liquid assets, including approximately $49 $9 million in cash and approximately $2 $5 million in unrestricted public securities.
Speaker #2: More specifically, the increase in NAV per share from $6.66 at the end of the first quarter was primarily attributable to a $1.88 per share increase driven by the net and realized appreciation of our investment portfolio during the second quarter, and an $0.89 per share increase due to net realized gain on sale of estments during the second quarter.
Not included in our unrestricted public securities or approximately $49 million of public securities subject to lock up our other sales restrictions as of course represents our investment in <unk> via the class a interest in CW opportunity to our team.
Speaker #2: These increases were offset by a 16-cent per share decrease due to net investment loss, and a 9-cent per share decrease from the impact of stock-based compensation during the quarter.
As I mentioned previously CW opportunity to opiates, an SCB or for which the class a membership interest is the only invested in our class a common shares of <unk>.
Speaker #2: At June 30th and currently, there are 23 million 888 thousand 107 shares of the company's common ock outstanding. Regarding our liquidity as of quarter-end, we ended the quarter with approximately 52.4 million of liquid assets, including approximately 49.9 million in cash and approximately 2.5 million in unrestricted public securities.
Okay.
Throw capital confirmed as of June 32025, the underlying class a common shares held by CW opportunity choppy, we're not registered and are therefore subject to certain restrictions on salary transfer, which faro capitalize applied a discount to the closing share price as of the reporting date as such at quarter end, our CW opportunity to LP position was materially discounted.
Speaker #2: Not included in our unrestricted public securities are approximately 40.9 million of public securities subject to lockup or other sales restriction as of quarter-end. This represents our investment in CoreWeave via the Class A interest of CW Opportunity to LP.
Finally, I'd like to conclude with additional commentary on our recent dividend declaration and payment subsequent.
July 3rd Zero Capital's board of directors declared a cash dividend paid on July 31, the company's common stockholders of record as of close of business on July 21st. This dividend is generally attributable to the successful monetization of certain necessary capital public securities and other promising developments in our investment portfolio as Mark mentioned based on ongoing portfolio activity we have.
Speaker #2: As I mentioned previously, CW Opportunity to LP is an SPV for which the Class A membership interest is solely invested in the Class A common ares of CoreWeave.
Speaker #2: SURO CAPITAL irmed, as of June 30th, 2025, the underlying Class A common shares held by CW Opportunity to LP were not registered and are therefore subject to certain restrictions on sale or transfer for which SURO CAPITAL has applied a discount to the closing share price as of the reporting date.
The pace of acquiring additional distributions throughout the year.
Date of declaration and amount of any dividends or distributions, including any future distributions are subject to this whole discussion of Cerro Capital's board of directors the aggregate amount of distributions declared and paid by throw capital will be fully taxable to stockholders.
Speaker #2: As such, at quarter-end, our CW Opportunity to LP position was materially discounted. Finally, I'd like to conclude with additional commentary on our recent dividend declaration and payment.
<unk> character of <unk> capital distributions cannot be finally determined until the close of stereo capitals taxable year, which is December 31 31.
Speaker #2: Subsequent to quarter-end on July 3rd, SURO CAPITAL's board of directors declared a cash dividend of 25 cents per share, paid on July 31st to the company's common stockholders of record as of the close of business on July 21st.
Zero capital will report the actual tax characteristics of each year's distributions annually to stockholders and the IRS on form 10, 99 civ subsequent to year end.
Speaker #2: This dividend is generally attributable to the successful monetizations of certain of SURO CAPITAL's public securities and other promising developments in our estment portfolio. As Mark mentioned, based on ongoing portfolio activity, we anticipate declaring additional distributions throughout the year.
As a result of the 25 cents per share cash dividend paid on July 31 to stockholders of record as of close of business on July 21st effective as of July 21, the conversion rate applicable to the six 5% convertible notes due 2029 was adjusted to $7 53 per share or 132 spot 7530 shares of the company's in dollar principal amount of the.
Speaker #2: The date of declaration and amount of any dividends or distributions, including any future distributions, are subject to the sole discussion of SURO CAPITAL's board of directors.
Speaker #2: The aggregate amount of distributions declared and paid by SURO CAPITAL be fully taxable to stockholders. The tax character of SURO CAPITAL's tions cannot be finally determined until the close of SURO CAPITAL's taxable year, which is December 31st.
Six 5% convertible notes due 2029.
The initial conversion price of $70 <unk> per share or 129, five <unk> three shares of the company's common stock per $1000 principal amount of the second half convertible notes due 2029, which has been effective since issuance.
Speaker #2: SURO CAPITAL will report the actual tax characteristics of each year's distributions annually to stockholders and the IRS on Form 1099-DIV, subsequent to year-end. As a result of the 25-cent per share cash dividend paid on July 31st to stockholders of record as of the close of business on July 21st, effective as of July 21st, the conversion rate applicable to the 6.5% convertible notes due 2029 was adjusted to $7.53 per share, or $132.7530 shares of the company's common stock per $1,000 principal amount of the 6.5% convertible notes due 2029.
The conversion rate of six 5% convertible notes due 2029 was made pursuant to the note purchase agreement governing that note that concludes my comments, we would like to thank you for your interest and support of soil capital now I will turn the call over to the operator to start the Q&A session operator.
Sure.
Thank you if you'd like to ask a question or make a contribution on todays call. Please press star one on your telephone keypad to withdraw your question. Please press star please limit to only one question per person.
Speaker #2: From the initial conversion price of $7.75 per share, or $129.0323 shares of the company's common stock per $1,000 principal amount of the 6.5 convertible notes due 2029, which has been effective since issuance.
Would be at wife's went to ask your questions.
Okay.
We will take our first question from Brian Mckinnon citizens. Your line is open. Please go ahead.
Speaker #2: The adjustment to the version rate of the 6.5% convertible notes due 2029 was made pursuant to the note purchase agreement governing said note. That concludes my comments.
Thanks, Good evening, Mark analysis, and congrats on all the recent momentum so looking at the public holding at six <unk>.
Speaker #2: We would like to thank you for your interest and support of SURO CAPITAL. Now, I will turn the call over to the operator to start the Q&A session.
<unk> in the quarter realized gains totaled $21 million in aggregate, that's roughly 85 per share you're only declared a 25 cent dividend I know this will continue to move higher in the coming quarters, just as you monetize some of your additional that's what the thought process a little bit around the second quarter dividend and then is there any.
Speaker #2: Operator.
Speaker #1: Thank you. If ou'd like to ask a question or make a contribution on today's call, please press star one on your telephone keypad to withdraw your question.
Speaker #1: Please press star two. Please limit to only one question per person. You will be advised when to ask your questions. We will take our first question from Brian McKenna, Citizens.
The way to think about the potential size of dividends in <unk> and <unk> based on the current mark to market of your public positions today.
Speaker #1: Your line is open. Please go head.
Thanks, Brian and again for your ongoing support.
Speaker #5: Thanks. Good evening, Mark and Allison, and congrats on all the recent momentum. So looking the public holding Act exits in the quarter, realized gains totaled $21 million.
Support and efforts around coverage with us.
As we've done in the past, we sort of we project out what we think our dividend payout.
Speaker #5: In aggregate, that's roughly 85 cents per share. You only declared a 25-cent dividend. I know this will continue to move higher in the coming quarters, just as you monetize some of your additional investments.
Patients will be in sizing.
As you remarked we did take.
A reasonable amount of gains to date, we also did come into the year with.
Speaker #5: But can you just talk about the thought process a little bit around the second quarter dividend? And then is there any way think about the potential size of dividends in 3, 2, and 4 to you based on the current mark-to-market of your public positions today?
With realized losses, which we become as we look forward.
We expect to have ongoing monetization of some of our public companies become freely tradable.
Speaker #6: Thanks, Brian. And again, thank you for your ongoing support and efforts around your coverage with us. As we've done in the past, we sort of we project out what we think are dividend cadence will be and sizing.
<unk> being one of them.
The grab a gun Columbia too.
Parts of that will be others. So we anticipate once we see how those monetization monetization occur.
To declare.
At least one and most probably two distributions.
Speaker #6: As you remarked, we did take a reasonable amount gains to date. We also did come into the year with realized losses, which we were able to overcome.
Targeting one towards the end of Q3 and another as we get towards the end of the year.
Thank you.
Speaker #6: As we look forward, we expect to have ongoing monetizations of some of our public companies that will become freely tradable, CoreWeave being one of them, the Grabagon, Columbia 2, parts of that will be others.
Yes, no further questions on the line. So I will now hand, you back to your host for closing remarks.
Thank you all for attending our call. This is really an extremely exciting time for so we're very fortunate to have positioned the portfolio in a way to take advantage of what is transpiring in the AI ecosystem and we appreciate you joining us and being shareholders.
Speaker #6: So we anticipate once we see how those monetizations occur, to declare at least one and most probably two distributions targeting one towards the end of Q3 and another as we get towards the end of the year.
Thank you very much.
Thank you for joining today's call you may now disconnect.
Speaker #6: Thank ou.
Speaker #1: There are no further questions on the line, so I will now hand you back to your host for closing remarks.
Speaker #6: Thank ou all for attending our call. This is really an extremely exciting time for SURO. We're very fortunate to have positioned the portfolio in a way to take advantage of what is transpiring in the AI ecosystem and we appreciate you joining us and being shareholders.
Speaker #6: Thank you very much.