GSV Capital Reports Fourth Quarter and Fiscal Year 2011 Results of Operations
Woodside, CA – March 12, 2012 –GSV Capital Corp., “GSV”, (Nasdaq: GSVC) today reported financial results for the fourth quarter and fiscal year ended December 31, 2011.
Management Commentary
“The fourth quarter marked tremendous progress for GSV as we continued to execute on our strategy of investing in high-growth, venture-backed companies that we believe will drive significant value creation. We made follow-on investments in Facebook and Twitter, which represent the largest positions in our portfolio. Our investment activity during the quarter also included new positions in companies such as Dropbox, Grockit, and ZocDoc. In addition, Groupon and Zynga completed their initial public offerings during the quarter,” said Michael T. Moe, GSV's CEO and founder. “2012 is off to a great start for GSV, as we successfully raised $96.2 million in a secondary offering which was completed on February 15th. We are highly encouraged that we were able to quickly complete a significant capital raise that provides us with the resources to execute on our investment strategy and take advantage of what we believe are exciting opportunities in the market.”
Fourth Quarter 2011 Portfolio Investment Activity
GSV invested in the following new portfolio companies during the fourth quarter of 2011: Control 4 Inc.; DreamBox Learning, Inc.; Dropbox, Inc.; Grockit Inc.; StormWind, LLC; The Echo System Corp.; The rSmart Group, Inc.; and ZocDoc Inc.. Additional investments in Facebook, Inc., Kno, Inc., and Twitter, Inc. were also made by GSV during the quarter.
Current Portfolio as of December 31, 2011
Our investment portfolio consists of companies that we believe represent the “megatrends” that have the potential to drive the market in the decades to come. GSV invests in companies that combine what we believe are powerful technological, economic and social forces that create growth opportunities in the economy. At the end of the fourth quarter of 2011, GSV’s portfolio included investments in the following companies: Bloom Energy Corporation; Chegg, Inc.; Control 4 Inc.; DreamBox Learning, Inc.; Dropbox, Inc.; Facebook, Inc.; Gilt Groupe, Inc.; Grockit Inc.; Groupon, Inc.; Kno, Inc.; PJB Fund LLC (loan linked to the value of Zynga, Inc.); Serious Energy, Inc.; SharesPost, Inc.; Silver Spring Networks, Inc.; StormWind, LLC; The Echo System Corp.; The rSmart Group, Inc.; TrueCar, Inc.; Twitter, Inc.; ZocDoc Inc.; and ZoomSystems.
Financial Results
| December 31, 2011 | ||||
| Total Portfolio Investments | $ | 64,078,150 | ||
| Total Investments | $ | 91,078,194 | ||
| Total Cash | $ | 385,995 | ||
| Total Assets | $ | 91,798,242 | ||
| Total Liabilities | $ | 20,294,994 | ||
| Net Assets | $ | 71,503,248 | ||
| Net Asset Value Per Share | $ | 12.95 | ||
| For the three months ended December 31, 2011 | For the period from January 6, 2011 (date of inception) to December 31, 2011 | |||||||
| Total Investment income | $ | 108,920 | $ | 162,328 | ||||
| Net Investment Loss | $ | (677,663 | ) | $ | (2,033,864 | ) | ||
| Net Change In Unrealized Depreciation on Non-Control/Non-Affiliated Securities | $ | (1,025,996 | ) | $ | (1,579,800 | ) | ||
| Net Decrease in Net Assets Resulting From Operations | $ | (1,703,659 | ) | $ | (3,613,664 | ) | ||
Net Decrease in Net Assets Resulting FromOperations Per Average Share(1) | $ | (0.31 | ) | $ | (1.07 | ) | ||
Portfolio Investments
The total value of GSV’s portfolio investments was approximately $64.1 million at December 31, 2011. During the fourth quarter of 2011, GSV originated approximately $23.5 million of investments in eight new and three existing portfolio companies. At December 31, 2011, GSV had equity investments in 19 portfolio companies and debt investments in two portfolio companies.
Results of Operations
Investment income was $108,920, or $0.02 per share, for the quarter ended December 31, 2011, and $162,328, or $0.05 per share, for the period from January 6, 2011 (date of inception) to December 31, 2011. Net investment loss was $677,663, or $0.12 per share, for the quarter ended December 31, 2011, and $2,033,864, or $0.60 per share, for the period from January 6, 2011 (date of inception) to December 31, 2011. Net change in unrealized depreciation was $1,025,996, or $0.19 per share, for the three months ended December 31, 2011, and $1,579,800, or $0.47 per share, for the period from January 6, 2011 (date of inception) to December 31, 2011. Net decrease in net assets resulting from operations was $1,703,659, or $0.31 per share, for the three months ended December 31, 2011, and $3,613,664, or $1.07 per share, for the period from January 6, 2011 (date of inception) to December 31, 2011.
| (1) | Weighted average common shares for the period from January 6, 2011 (date of inception) to December 31, 2011 was calculated starting from the issuance of 100 shares on February 28, 2011. Weighted average commonshares were 5,520,100 and 3,377,429 for the three-month period ended December 31, 2011 and since inception period, respectively. |
Conference Call and Webcast Information
The GSV Capital fourth quarter and fiscal year 2011 teleconference and webcast is scheduled to begin at 2:00 p.m., Pacific Time, on Monday, March 12, 2012. To participate on the live call, analysts and investors should dial 1-877-941-1427 at least ten minutes prior to the call. GSV Capital will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the Company’s Web site athttp://gsvcap.com.
About GSV Capital Corp.
GSV Capital Corp. (Nasdaq: GSVC) is a publicly traded investment fund that seeks to invest in high-growth, venture-backed private companies. Led by industry veteran Michael Moe, the fund seeks to create a portfolio of high-growth emerging private companies via a repeatable and disciplined investment approach, as well as to provide investors with access to such companies through its publicly traded common stock. GSV Capital is headquartered in Woodside, CA.
Forwarding-Looking Statements
Statements included herein may constitute “forward-looking statements,” which relate to future events or our future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission. GSV Capital Corp. undertakes no duty to update any forward-looking statements made herein.
Media:
Kim Hughes
(415) 516-6187
kim@blueshirtgroup.com
Investors:
Alex Wellins
(415) 217-5861
alex@blueshirtgroup.com
STATEMENT OF ASSETS AND LIABILITES
(Unaudited)
| December 31, 2011 | ||||
| ASSETS | ||||
| Investments at fair value: | ||||
| Investments in non-control/non-affiliated securities (cost of $65,658,866) | $ | 64,078,150 | ||
| Investments in United States treasury bills (cost of $19,999,128) | 20,000,044 | |||
| Investments in money market funds (cost of $7,000,000) | 7,000,000 | |||
| Total Investments (cost of $92,657,994) | 91,078,194 | |||
| Cash | 385,995 | |||
| Due from: | ||||
| GSV Asset Management | 13,470 | |||
| Portfolio company | 9,249 | |||
| Accrued interest | 158,389 | |||
| Prepaid expenses | 92,750 | |||
| Deferred offering costs | 56,436 | |||
| Dividend receivable | 1,063 | |||
| Other assets | 2,696 | |||
| Total Assets | 91,798,242 | |||
| LIABILITIES | ||||
| Due to: | ||||
| GSV Asset Management | 78,427 | |||
| Other affiliates | 10,782 | |||
| Payable for unsettled securities transaction | 19,999,128 | |||
| Accounts payable | 206,357 | |||
| Accrued expenses | 300 | |||
| Total Liabilities | 20,294,994 | |||
| Commitments and contingencies | ||||
| Net Assets | $ | 71,503,248 | ||
| NET ASSETS | ||||
| Common Stock, par value $0.01 per share | ||||
| (100,000,000 authorized; 5,520,100 issued and outstanding) | $ | 55,201 | ||
| Paid-in capital in excess of par | 73,027,847 | |||
| Unrealized depreciation on investments | (1,579,800 | ) | ||
| Net Assets | $ | 71,503,248 | ||
| Net Asset Value Per Share | $ | 12.95 | ||
STATEMENTS OF OPERATIONS
(Unaudited)
| For the three months ended December 31, 2011 | For the period from January 6, 2011 (date of inception) to December 31, 2011 | |||||||
| INVESTMENT INCOME | ||||||||
| Interest income | $ | 106,167 | $ | 158,389 | ||||
| Dividend income | 2,753 | 3,939 | ||||||
| Total Investment Income | 108,920 | 162,328 | ||||||
| OPERATING EXPENSES | ||||||||
| Investment management fees | 233,961 | 618,865 | ||||||
| Costs incurred under administration agreement | 249,166 | 554,232 | ||||||
| Professional fees | 138,435 | 409,983 | ||||||
| Organization expenses | - | 198,831 | ||||||
| Insurance expense | 47,193 | 142,494 | ||||||
| Directors’ fees | 42,500 | 127,500 | ||||||
| Investor relations expense | 36,250 | 89,250 | ||||||
| Other expenses | 39,078 | 55,037 | ||||||
| Total Operating Expenses | 786,583 | 2,196,192 | ||||||
| Net Investment Loss | (677,663 | ) | (2,033,864 | ) | ||||
| Net Change in Unrealized Depreciation on Investments | (1,025,996 | ) | (1,579,800 | ) | ||||
| Net Decrease in Net Assets Resulting From Operations | $ | (1,703,659 | ) | $ | (3,613,664 | ) | ||
| Net Decrease in Net Assets Resulting From Operations Per Average Share(1) | $ | (0.31 | ) | $ | (1.07 | ) | ||
| (1) | Weighted average common shares for the period from January 6, 2011 (date of inception) to December 31, 2011 was calculated starting from the issuance of 100 shares on February 28, 2011. Weighted average common shares were 5,520,100 and 3,377,429 for the three-month period ended December 31, 2011 and since inception period, respectively. |
FINANCIAL HIGHLIGHTS
(Unaudited)
| For the three months ended December 31, 2011 | For the period from January 6, 2011 (date of inception) to December 31, 2011 | |||||||
| Per Share Data(1): | ||||||||
| Net asset value at beginning of period | $ | 13.26 | $ | - | ||||
| Issuance of common shares | - | 14.67 | (2) | |||||
| Underwriters’ discount | - | (0.86 | ) | |||||
| Offering costs | - | (0.19 | ) | |||||
| Net investment loss | (0.12 | ) | (0.37 | ) | ||||
| Change in unrealized depreciation | (0.19 | ) | (0.30 | ) | ||||
| Net asset value at end of period | $ | 12.95 | $ | 12.95 | ||||
| (1) | Financial highlights are based on shares outstanding as of December 31, 2011. | |||||||
| (2) | Issuance of common shares is based on the weighted average offering price for the shares issued during the period. | |||||||
SCHEDULE OF INVESTMENTS
December 31, 2011
(Unaudited)
| Portfolio Investments* | Headquarters / Industry | Shares / Par Amount | Cost | Fair Value | % of Net Assets | |||||
| Bloom Energy Corporation | Sunnyvale, CA | |||||||||
| Common shares | Fuel Cell Energy | 96,389 | $ 1,815,818 | $ 1,771,335 | 2.48% | |||||
| Chegg, Inc. | Santa Clara, CA | |||||||||
| Common shares | Textbook Rental | 774,193 | 6,003,694 | 5,999,996 | 8.39% | |||||
| Control 4 Inc. | Salt Lake City, UT | |||||||||
| Common shares | Home Automation | 666,667 | 1,034,827 | 1,000,000 | 1.40% | |||||
| DreamBox Learning, Inc. | Bellevue, WA | |||||||||
| Preferred shares, Series A | Education Technology | 3,579,610 | 757,955 | 750,000 | 1.05% | |||||
| Dropbox, Inc. | San Francisco, CA | |||||||||
| Preferred shares, Series A | Online Storage | 552,486 | 5,015,333 | 4,999,998 | 6.99% | |||||
| Facebook, Inc. | Palo Alto, CA | |||||||||
| Common shares, Class B | Social Networking | 350,000 | 10,465,981 | 10,462,500 | 14.63% | |||||
| Gilt Groupe, Inc. | New York, NY | |||||||||
| Common shares | e-Commerce | |||||||||
| Flash Sales | 203,100 | 5,576,979 | 5,499,250 | 7.69% | ||||||
| Grockit, Inc. | San Francisco, CA | |||||||||
| Preferred shares, Series B | Online Test | |||||||||
| Preparation | 2,728,252 | 2,005,945 | 2,000,000 | 2.80% | ||||||
| Groupon, Inc.(2) | Chicago, IL | |||||||||
| Common shares | Online Deals | 80,000 | 2,128,585 | 1,188,288 | 1.66% | |||||
| Kno, Inc. | Santa Clara, CA | |||||||||
| Preferred shares, Series C | Digital | 440,313 | 2,262,006 | 2,250,000 | 3.15% | |||||
| Common shares | Textbooks | 50,000 | 214,303 | 205,000 | 0.29% | |||||
| Total | 2,476,309 | 2,455,000 | 3.44% | |||||||
| PJB Fund LLC(1) (3) | San Francisco, CA | |||||||||
| Structured note, 10%, due 8/15/2012 | Social Gaming | 4,000,000 | 4,029,259 | 4,000,000 | 5.59% | |||||
| Serious Energy, Inc. | Sunnyvale, CA | |||||||||
| Common shares | Green Materials | 178,095 | 739,130 | 712,380 | 1.00% | |||||
| SharesPost, Inc. | San Bruno, CA | |||||||||
| Preferred shares, Series B | Online | 1,776,970 | 2,257,984 | 2,256,752 | 3.16% | |||||
| Common warrants, $0.13 strike price, expire 6/15/2018 | Marketplace | |||||||||
| (Finance) | 770,934 | 23,128 | 17,731 | 0.02% | ||||||
| Total | 2,281,112 | 2,274,483 | 3.18% | |||||||
| Silver Spring Networks, Inc. | Redwood City, CA | |||||||||
| Common shares | Smart Grid | 110,143 | 1,153,381 | 1,101,430 | 1.54% | |||||
| StormWind, LLC | Scottsdale, AZ | |||||||||
| Preferred shares, Series B | Electronic | 1,711,111 | 959,209 | 946,335 | 1.32% | |||||
| Preferred warrants, $0.64 strike price, expire 12/1/2012 | Marketing and Business Services | 1,568,518 | 53,665 | 53,665 | 0.08% | |||||
| Total | 1,012,874 | 1,000,000 | 1.40% | |||||||
| The Echo System Corp.(1) | New York, NY | |||||||||
| Structured note, 6%, due 1/28/2013, and warrant, $0.20 strike price, expires 11/14/2016 | Social Analytics | 500,000 | 505,823 | 500,000 | 0.70% | |||||
| The rSmart Group, Inc. | Scottsdale, AZ | |||||||||
| Preferred shares, Series B | Higher Education | |||||||||
| Learning Platform | 480,769 | 513,311 | 500,000 | 0.70% | ||||||
| TrueCar, Inc. | Santa Monica, CA | |||||||||
| Common shares | Online | |||||||||
| Marketplace (Cars) | 377,358 | 2,014,551 | 1,999,997 | 2.80% | ||||||
| Twitter, Inc. | San Francisco, CA | |||||||||
| Common shares | Social | |||||||||
| Communication | 735,600 | 12,304,345 | 12,113,493 | 16.94% | ||||||
| ZocDoc Inc. | New York, NY | |||||||||
| Preferred shares | Online Medical | |||||||||
| Scheduling | 200,000 | 3,563,178 | 3,500,000 | 4.89% | ||||||
| ZoomSystems | San Francisco, CA | |||||||||
| Preferred shares, Series A | Smart e-tail | |||||||||
| (Retail) | 1,250,000 | 260,476 | 250,000 | 0.35% | ||||||
| Total Portfolio Investments | $ 65,658,866 | $ 64,078,150 | 89.62% |
| * | All portfolio investments are non-control/non-affiliated and non-income producing, unless identified. Equity investments are subject to lock-up restrictions upon their initial public offering. |
| (1) | Investment is income producing. |
| (2) | On November 8, 2011, Groupon, Inc. priced its initial public offering, selling 35,000,000 shares at a price of $20.00 per share. GSV Capital Corp.’s shares in Groupon are subject to a lock-up agreement that expires on May 1, 2012. |
| (3) | Represents a $4 million unsecured promissory note with an interest rate of 10% and maturity date of August 15, 2012 that was issued by PJB Fund LLC that may be repaid, at PJB Fund LLC’s election, either by transfer of a certain number of shares of common stock of Zynga, Inc. or with a cash amount of equivalent value. The amount payable under the note will be equal to the face amount, plus the greater of accrued interest (at a rate of 10%) or a return based on the relative value of Zynga, Inc. To the extent the borrower repays the note in cash, GSV Capital Corp. would have no further direct or indirect interest in Zynga, Inc. On December 15, 2011, Zynga, Inc. priced its initial public offering, selling 100,000,000 shares at a price of $10.00 per share. |