Bought a few more yesterday. I want to see some visibility in the non core as it is such a large percentage so I can get a feel with how it is doing. Most of the core I at least have some idea. |
 I’ve been looking at the revenue multipliers for the sector vs those GROW actually used for 2017 to the present.
There is a close correlation between when we trade at a premium to NAV/share and when the revenue multiplier GROW used is below sector averages (hidden value). This held true for the whole of the September 2017 to March 2021 period.
Conversely when GROW has used above sector averages for revenue multipliers we have traded at a discount -up to 66%. This applies for the whole of the March 2022 to September 2024 period.
However with sector norms about to rise to maybe 7.3 and GROWs' September 2024 multiple (excluding Revolut) at "only" 6.0 we may be in for a treat. Either GROW raise the multiple used or the market prices in that they can do so. either way we will get a boost.
It has always puzzled me that the big funds that have access to the company level valuations themselves (which we retail investors do not have) have behaved they way they have and allowed such large discounts to NAV/share to materialize. However, looking at this data it is logical even if an overshoot. Overshoots of a trend are rational as the big funds with the data we don't have have an incentive to let the trend run it's course before they change direction -even though they are already minded to do so. They time the market.
The dip yesterday I think will be short lived. The stars are aligning for a sustainable 3 year trend up which will be the mirror opposite of the 3 year trend down we just have had. Top up and buckle in. We are about to have a giant 5 year wide U shaped dip, bottom and recovery. |
2027 report =2017 report |
Revenue multipliers to be used for valuations of the tech and tech sectors (especially our heavy weighting in enterprise tech and deep tech) are key to profit” or Loss” (NAV/share increase or decrease). NAV/share. Increase or decrease critical to share price
I’ve been looking at valuations since 2017. We were steady on 3x revenue multipliers up to September 30 2019. IN the 2027 report it stated they were using 3x for a long time pre IPO.
Post 2016 IPO the portfolio when they raised capital in a formal round or IPO’d outperformed the conservative 3x by a factor of nearly triple. I assume this is the key reason our share price was consistently at a premium varying between 8 and 66%. There was hidden value.
The period March 31 2022 to September 2024 saw multiples used ranging from 6.0 to 8.4 combined with sharp discounts of share price to NAV/share. The market did not believe anymore in hidden value and was concerned about down valuations.
Between March 2024 and September 2024 there was a modest decline in revenue multipliers (captured in GROW’s reports as 6.6 down to 6.0. This hurt our valuations by enough to offset our strong portfolio sales growth.
However the September 30 2024 to March 2025 half year is seeing a modest rebound in revenue multipliers betwen 10% and 30%. Once the market absorbs this good news we should have very positive year end results. When GROW do the valuations for the year end results they will likely use a revenue multiple that is around 6.6 with good prospects for further improvements going forward. That 10% boost per half year plus organic sales growth should drive a substantial NAV/Share increase.
Then of course Revolut is on our books for 120m at a discounted valuation (around 30bn us rather than the 45bn the secondary sales were at). Recent news on secondary sales for Revolut suggests an appetite for a 60bn US valuation. That would be a circa 120m uplift in our NAV (about 10% for one portfolio share alone. While I expect GROW not to book all of the 60bn valuation indicators they should now accept the 45bn without a need for a 60m discount. |
From Chat GBT
Yes, that’s correct. Across the U.S., EU, and UK, for sectors like General Tech, Enterprise Tech, and Deep Tech, the revenue multiples show a general trend of rebound between September 2024 and March 2025. This is due to expectations of market stabilization and investor confidence returning after a period of economic uncertainty. While the specifics vary by region and sector, the overall forecast suggests a recovery in valuations during this time.
Broadly, the expected recovery in revenue multiples between September 2024 and March 2025 is around 10-30%. This range depends on the sector and region, with more volatile sectors like Deep Tech potentially seeing higher rebounds, while General Tech and Enterprise Tech may experience more moderate recoveries. The rebound reflects expectations of market stabilization, easing economic concerns, and increasing investor confidence, but the exact percentages can vary depending on the specific industry and regional dynamics. |
Molten Ventures VCT is currently open for investment.
The VCT launched in 1998 and has been managed by Molten Ventures plc (formerly Draper Esprit plc) since 2017.
The VCT co-invests alongside the plc’s own balance sheet and currently has a portfolio of around 35 active companies. The bias is towards early-stage digital technology businesses in four sectors where the manager has considerable experience and a strong track record: consumer technology, enterprise technology, deep tech & hardware, and digital health & wellness.
Molten Ventures VCT targets dividends of 5% of NAV p.a. – dividends are variable and not guaranteed. In the five years to 31 December 2024, it delivered a NAV total return (including dividends) of 1.5%, paying out cumulative dividends equivalent to 25.4% of the starting NAV. Past performance is not a guide to the future. |
Steph, thanks for thisAs per my email below what's your view on buying the Molten Ventures VCT instead of GROW. They invest in same companies but the VCT has the tax benefits |
Hard to format but all info below. Wild variation on premium or discount to NAV/share. We vary from 66% above NAV/share (30th September 2017) to 67% below (30 September 2023). For first 5 years (march 2017 to March 2022) we traded at a very substantial average premium to NAV/share (with the exception of the covid crash for 6 months).
Then for the last 3 years we have been trading at a very substantial discount to NAV/share.
We seem hypersensitive as to forward speculation as to if NAV/share rising or falling (or in the case of COVID might fall). Small anticipated falls in NAV/share cause outsized decreases in share price The reverse may also be true.
US interest rate expectations seem to be (outside of COVID) biggest correlation. We are happy with 2.5% just not 4.5%.
Fair Value March 2017, Fair value Sept 30 2017. Fair Value march 31 2018 Fair Value Sept 30 2018 Fair Value march 31 2019 Fair Value Sept 30 2019 Fair Value march 31 2020 Fair Value Sept 30 2020 Fair Value march 31 2021 Fair Value Sept 30 2021 Fair Value march 31 2022 Fair Value Sept 30 2022 Fair Value March 2023 Fair Value Sept 30 2023 Fair Value 31 March 2024 Fair Value 30 Sept 2024
NAV/share 352 370 431 444 524 574 555 600 743 887 937 837 780 735 662 644
SP on same day 435 615 640 685 720 624 240 940 910 1006 765 303 273 243 226 404
% over or under 23.58% 66.22% 48.49% 54.28% 37.40% 8.71%. -56.76% 56.67% 22.48% 13.42% -18.36% -63.80% -65.00% -66.94% -65.86% -37.27% |
Page 49 of interim report 2025 states that
“a significant portion …the principal exposure to change in the rate is to change in the GBP and USD/EUR.”
It does not say the weighting between the Euro and Dollar.
We had a strong currency headwind in 2025 6 month results. Looking at Dollar and Euro rates in the March 31 2024 to Sept 30 2024 period that must have been mostly dollar. It was a 5% impact for dollar and 3% for euro.
So far dollar has pound dollar rate declined sharply (5%) and euro stable. From Sept 30 2024 to now about the same as it went up relative to pound in March 31 to Sept 30 period. SO we are in for a circa 25m boost to our valuations. .
PLus we were overly conservative on our valuation of Revolut which means at least a 30m boost to NAV. We assumed the 45bn valuation would not hold but it has and may now be credibly 60bn. Revolut now stating a billion per year profit and still rapidly growing sales so may grow into that valuation. We shall see.
A windfall is due just to accept the e45bn valuation. Plus exists at or above valuation September 30 2024. Plus sector multiples of sales to valuttion going up again according to pitch book.
I can’t see how we are are going to avoid booking a substantial profit (NAv/share increase) year end. I suspect within the accounting rules they will suppress the jump in order to do a bit of smoothing going forward so we don’t have a half loss again. We had profit every half year report between launch in 2016 and March 31 2022 inclusive. That consistency is why our share price can go above NAV/share if:
1) market conditions are stable
2) Nav/share growing faster than the market.
3) large parts of our fast growing portfolio is inaccessible to retail investors in any other way.
We have not had a “profit” (nav increase) since the spectacular 37% increase for the fiscal year ending March 31 2022. Then our NAV/share was 937p. I’m convinced we will get back up there due to fast organic growth of the portfolio even if multiples of sales based valuations are never at 2022 levels again.
Anyhow good luck all. |
Why invest with GROW when you can invest with Molten Ventures VCT with 5 percent dividend, tax clawback and no tax on divs - this isn't a rhetorical question, it looks to me they invest in same companies? Thoughts? |
This is good news re Revolut if they can go secondary on these figures of valuation and IPO in the US and Thought Machibe IPOs in London this could be good for the SP |
Can they register a profit, isn't this more about holdings going to IPO |
QRT have had that short position for years peaking at .9 during 2022. Currently .5.
They will have to close it at some point before we start registering a profit or they will get badly burned. |
The recent decline appears to have coincided with QRT taking its short position earlier this month...it will be interesting to see how this plays out over the next couple of months against the quadrupling of the buyback |
hxxps://www.uktech.news/fintech/more-than-1-billion-wiped-from-thought-machine-valuation-by-investor-molten-ventures-20241212
Any bouce back of thought machine will have an outsized impact on our year end results. The 35m decrease in our valuation on our books hurt our half yearly results hard and turned, on it’s own, overall profit into a loss -amplified by adverse currency movements. Looking likely we will have neutral currency movements and maybe thought machine looking better as well
No idea why we dipped to 3.04 right now. Just general market sentiment I guess. Shares a steal at below half NAV/share. |
It looks like Thought Machine may be back on track. The raging success of their Singapore client implementation will hopefully drive both new and mainstream banking clients their way. |
hxxps://pitchbook.com/news/articles/european-vc-roars-back-2024-sees-soaring-valuations-and-deal-sizes
Also good news |
Only low interest rates again will really make this instantly fly but we have a portfolio that has been sharply growing sales and not in any significant % going under so that sooner or later our portfolio performance grows into whatever the valuations are. Plus our valuations were discounted and were never as inflated as the 2021-2022 market -so less to grow into. Revolut typical. We woudl be justified to put it on our books at 45bn but it is on our books at 30bn. That caution means some hidden value and downside protection. That caution is why all component companies that we have recently exited are at our book value or better. Our book value is solid. No reason for a 50% discount to NAV/share. As soon as we start growing NAV/share again this scale of discount will quickly disappear.
Whether we get a premium to NAV/share again depends on market stability.
I think we are already there and our NAV/share will start rising and consistently rise going forward. 6 to 8 quid by April 2026. 10 to 14 quid by April 2027. A giant 5 year wide U shaped dip and recovery |
Double edged sword Stef, but at least some level of visibility when 100% wing and a prayer with most of the portfolio. |
hxxps://files.pitchbook.com/website/files/pdf/2024_Annual_European_VC_Valuations_Report.pdf
Very good news. Should be a very good 2 years ahead. |
Should help solidify NAV this year.
“The Private Intermittent Securities and Capital Exchange System is expected to launch in May as a regulated secondary market for private share trading. It is intended to unlock more investment for fast-growing UK companies, of which the ScaleUp Institute estimates there are around 14,000 with a combined turnover of £372.3bn.
Several firms are set to kick-start venues under Pisces. Interested parties range from the London Stock Exchange Group to private trading specialists looking to expand their platforms.
People familiar with the matter say these include Globacap, JP Jenkins, Asset Match and startup-focused Envestors.
This push into trading in private markets comes at a time when the UK’s public markets have floundered. Last year, there were just 18 new listings in London, which is the worst number since the financial crisis.
Bankers have long argued that there is a secular trend of companies staying private for longer because of the pressures of going public and increased liquidity in private markets.
Goldman Sachs chief executive David Solomon said at a recent conference that private firms should exercise “great caution” when considering going public and that they “get capital privately, at scale”.” |
and not a moment too soon |
Register for Free to get streaming real-time quotes, interactive charts, live options flow, and more.
Hot Features
Premium
