TPVG - Earnings call transcript Q2 2021 | TriplePoint Venture Growth BDC Corp.

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Operator

Good afternoon, ladies and gentlemen. Welcome to the TriplePoint Venture Growth BDC Second Quarter 2021 Earnings Conference Call. At this time, all lines have been placed in a listen-only mode. After the speakers' remarks, there will be an opportunity to ask questions and instructions will follow at that time. This conference is being recorded and a replay of the call will be available in an audio webcast on the TriplePoint Venture Growth BDC website. to quarter you of pleased for company's is second the XXXX. management share the with results Company Today, representing President the Officer. Officer Officer, and company Chris is Jim of and Board; Labe, the Sajal Chief Srivastava, Mathieu, and Investment Chairman Chief Financial Chief Executive

the I the to Labe, company's remind regarding statements to call press I'd customary safe certain you that are over or future during to federal to and call, that this your release or attention the the considered harbor which turn under events like make company's Before condition, statements performance Mr. will statements future securities direct the disclosure in forward-looking law. relate management financial forward-looking

place for to Investors management's projections on opinions company's not cause to unless reflect filings, the obtain could any law. asked of materially statements with actual most by only which company's any copies results are or required not to the obligation as these any are refer forward-looking does the latest at today. factors website Exchange company important statements statements. undue during call, The differ please SEC that filings You update Commission to from our forward-looking undertake www.tpvg.com. To reliance recent Securities made the of to visit cautioned and

I'd to conference turn over the to Now, like Mr. Labe.

Jim Labe

signed TPVG's progress we totals notable net the past TPVG return was Thank increasing high or you, this on The operator. exceeding target Earnings our from Quarter value Second the are We term quality is all history. most and Call. in one strong which credit continued thank yield joining quarterly Good equity of a to and rise to highest during quarter afternoon our for sheets, asset and portfolio made average progress seeing in NAV. you maintaining funding

year since Additionally, quarter increased is our a more than over XX% ago. and pipeline doubled last

where matching to $XXX XXXX. in late-stage first committed in venture-capital the income companies, for companies, already the we is the to IPO environment of venture a the benefit were liquidity totals has to you of of operating and We as of XXX first the for investments value. continue them larger the long-term specifically venture the totals XXXX. we to year investments neared we're demand in course Deals get investment this targets remarkably have will billion equity market of fundraising stage to all or exits total substantial year backed our strong of growth on US second are TPVG first all portfolio our which and The consistent outlined been half Total for net capital meet along achieve in company is total half are of and events. of the asset drive increased the operates. this of announced capital half expectation sizes witnessing specs. stands with exceeded now. half. in of increased the portfolio to favor right hear XXXX, of In for market continue factors and Thirty-three and warrant our more exit growth and The A

quality. capitalizing on to it's maintain environment, portfolio we don't and to on focus we As on disciplined ever a this critically approach important compromise to growth credit robust want

In from meet For took to steps we warrant that debt our reason, we returns as positions. that generate investments focus and us critical the objective. from our on strong quarter, equity second high-quality will as enable companies to this well important

in remains trends While the for quarter, quality. earned portfolio in we fundings, increased of high our signed strong terms credit sheet, distribution under term the and our

all of we the particularly have term IPO. so excited TPVG's portfolio, and excess in as our We long by over of We're promising group foundation expect about since deep venture against select to targeted working leading continue to done us plan. generate cumulatively has for our a NII on This distribution our our investors to growth a and capital provided created companies. focus solid stage a having model execute venture of with

merger all in technology. I have combined past with It changes in think, of disruptions many associated of persist acceptance well Hims $XXX vaccines. to speed new Tempo the market TPVG The Medly, changes major circumstances across transformation. Large disruptions Perfect to consumer Active demand supply closing regulatory the Curology, tailwinds and many on impacted portfolio than customers both our rollout of of of our health continue continued market of their of pandemic companies a Grey and core enterprise set Foods sector, $XXX digital will of in companies. live, underway in X.X have consumer been billion connected last Fintech actions super In people Rent the Brands portfolio services e-commerce driving infrastructure alone, announced million investments drive telemedicine, the rounds and a million enable its It wholesale this and change and driven benefit our ever-growing example, Grey changes companies in and e-commerce, We these sectors. SPAC changes over quarter $XXX few sector is are Minted, completed purchasing online Enjoy, are in shift of billion the tailwind $X.X in and disruption logistics outsized to There Enjoy Capsule of greater behavior. and delivery, Grove, in build companies. equity of now healthtech, robotics, year. robotics million. COVID investment for to the by with companies some produced will good significant pandemic-driven witnessed banking with forward. Orange, by pharmaceutical accelerated going capital are transformations, where are and or We've technology Digit, behavior of the the and of many continued and close such use as huge are from raised procurement. SPAC. digital will examples how the our sector. accelerated robotics marketing. our are $XXX forever. economy charge benefiting Last companies, landscape. Transfix round. examples scale Transfix that Runway quarter monetary and just products The believe Orange of work, and companies on-demand everyone world for underway Upgrade, boosted this healthtech, Hydrow and each as announced These and of well which companies recipients in need massive retail to Nurx, consumer million and through portfolio growth support through the sectors, fitness. technology it continue I are the systems Hours the the promise able and these automation relationships and the raised other from for COVID E-commerce all All chain. markets. legacy directly the wellness, news in are think equity payment particular Our great platforms. and software sees exposed fintech, fragility to

tell, announced of these industry-wide valuation. compliment industry at robust venture equity sectors, technology underwriting the the underserved. data today's testament as address taking as We given in portfolio continues. example, currently an to future activity opportunities trends the billion equity whole plentiful activity can't to and round an We demand New particular. fundraising our debt substantial or and recently in quality. a if to This closing that environment. a venture It's segments in you continues equity excitement population advantage and equity our to lending create off million some large foresee risk Revolut, capital within of for $XXX is cases. $XX lending Positive raise in portfolio's a of an believe platforms and are big top our are financing

valuations debt in to planning equity companies in raise. order achieve environment, them growth they today's raise many higher to For enables the when accelerate

fact, in demand take lines where equity actually seeking process Today's volatility equity market The paid some has now more their four now continue is companies In recent pipe private. to TriplePoint back created is to us last lending and also raise strategy around when year, again. they of rewards. rounds debt to from off continue reap us to companies with again the number for are these whom those SPAC is to large they're we're remain raising that market close they're of now with right and of in debt Venture situations poised and longer portfolio a and expecting the seeing our

Capital our strength entrepreneurs our the innovation leading of in warrants, is returns the investment to And a TriplePoint these to platform. from to as deliver identifying continue is liquidity firms. differentiated of deep Sajal. We'll As venture and deep relationships our as deal the sustainable attractive we've with turn to to to capital our at over debt, will equity based continue led founders approach by now with flow. portfolio tailwinds our standing economy. promising disciplined benefit I'll the fundamental This the stick on well call process highlighted investments. past on ready and from

Sajal Srivastava

afternoon. Thank you, Jim, and good

the markets second to investment with growth progress robust for $XXX.X million our demand companies. venture making term capital execute the signed Jim lending TriplePoint as venture regards playbook XXXX. venture on As disciplined of With activity we particularly for are we mentioned the and continue Capital and quarter be to during sheets stage

seven IPO venture ago for closed TPVG. growth fourth we term years from million stage debt and sheets closed signed Our were term Signed of and six level quarter. both up commitments last since TPVG's highest $XXX.X sheets companies at to quarterly commitments

of is excited quite closely the capital from on resemble as and high-quality business companies two which Jim rolling most sectors we're in markets direct Software HealthTech activity portfolio sell Of We this is Amazon and invest we Service subscription and consumer the one public SaaS of to companies continue sectors attractive and top that sectors and continue to in the a marketplace, two investments marketplaces. and acquiring mentioned the quarter, perspective. our other a profitable up focused funds or last new software companies, be as the private our and an eCommerce, the and growing all to investment online the in small one active Fintech, on venture of businesses, are markets are businesses

at commitments we from in potential in to yield. million million capturing receiving companies warrants quarter, portfolio portfolio valued conjunction more last while warrants During are valued at raising received $X.X companies, that demonstrates the we on also $X.X quarter. XX debt our equity compared seven second still with increase bar This in our the as upside companies

year-to-date. companies have We This also robust brings of same the made has access to quarter investment our reflective at during million than doubled three the again high-quality direct environment. equity one direct we equity the which more $X.X $XXX,XXX investments total quarter, six opportunities of equity investments two during valued the and to

During we came fundings quarter, Approximately the debt million XX% companies high end million exceeded our of QX. we fundings range closed which to QX. for million from in in the funded seven quarterly the $XX second of debt guided $XX that new commitments we $XX investments gross to for

commitments demonstration our a So, healthy drive to real more efforts of and effectively. of statistic utilization our

have of unfunded second our towards companies by So the in Consistent existing between third $XXX the funded loans utilization high million close, commitments on the drawing new $XXX far for sizable and pattern here as per gross the expect portfolio term prior QX we our fundings half in as year. backlog million we with sheets, which of well commitments million of commitments come over rates QX is of pipeline, quarter. signed supported unfunded and guidance, at of our quarter, $XX new to

is yielding yield continue portfolio annualized we also a XX.X% funded build of carrying XX.X% the from portfolio to last We which quarter weighted up a investments at debt with for quarter, investments. new the origination, average high during

had for the XX.X% a investments core $XX annualized portfolio quarter. overall the excluding was debt million yield weighted loan quarter an During on up XX.X% we we prepayments quarter, prepayments from as and portfolio of yield total achieved average last result, slightly XX%, of

in third $XXX,XXX million of accelerated Here the quarter, of income. generating $XX we've loan prepayments had

our again equity activity fundraising the industry venture and particular, a capital see quality. to portfolio. is We portfolio's our testament continue substantial within In in which to

QX. over During portfolio companies XXX quarter million capital of over raising companies in the million raised to in XX of $XXX total addition total capital five, portfolio in in

to on to categories, added with top in the on the obligor's quality, portfolio were remains outlook obligor's two five, investments during no strong credit of four and XX% second and three, debt Moving our for placed our consistent were no categories, our credit QX, quarter. with non-accrual

weighted average investment compared to end fact, In investment to our portfolio of ranking the as X.XX of QX. at X.XX debt the improved

lending completing of X X student finance international category in a the from upgraded company category result During one X category is as financing, leaving graduate was in a quarter, one to company. company which Prodigy only

QX pleased million first to outstanding $XXX in and securitization loans investment-grade to here report on us Prodigy issuing paid securities its that Prodigy from $X and of During asset-backed them Based now to down will completed loans Prodigy, that pay QX, QX. developments we're here interest. expect PIK are remaining interest cash other we switch on to million X and category to in upgrade these

Our on only and was continues loan be one to to our mark fluctuations. category for portfolio last really currency prior our flat company with quarter non-accrual

commitment During completed quarter, never at our unrealized as company in and we positions total the and warrant gain even a end and the the drew mergers, we their XXX,XXX auto, equity though and the of their have on their there quarter, and based unfunded learning SPAC quarter. the SPAC and Talkspace SPAC mergers merger announced deadline technologies QX, expired, Sonder have in of the on five with process. all totaled announced brings Bird, the SPAC during companies This also unused. to portfolio Enjoy, completed successfully back Inspur its announced first three live TPVG's company

basis totals given uncertainty million merger announced. companies discount value five exchange $X.X until investments mark cost in we Generally, as of do with in type And situations the of our of QX. then their not and fair million a $X further up values these associated we are completion. ratios these in the fair Our warrants equity with

more within than warrant in can TPVG and fact, equity our does our or been unlock exploring could IPOs, As which it M&A continue companies portfolio shareholders have you exit actively value we in portfolio. there to a see SPAC if mergers additional in hasn't from consummated portfolio, activity our slowdown for substantial

and the activity highlight a round value raising has company, for to enterprise and and lender has private platform A Fintech accretion, companies portfolio $XX in announced in One equity I The supported team addition, the a their Series since like software in In the as involved valuation. an and particularly continues equity in sectors. is round investor global an a been TPVG in the our in equity built portfolio point significant a company C result leader both billion that would FinTech XXXX since Series space with equity raise triple resolute to company. QX, is the revenue their at

warrant share estimate be value QX and not from to million we our million, valued have between process of completed increase net QX we Although $X.XX fair up $XX $X.XX $XX for $X.X TPVG's and as asset value. per between equity to investments million or an and

and to realized meaningful is but While we one more strong are strong we're the our as many still outlook net pleased the solid things. portfolio the capital compromise and portfolio us importantly, will for unrealized and and gains, mentioned, but the deliver yield And credit heads portfolio Clearly, equity unrealized grow with in Jim realized thoughtful portfolio. warrant outlook shareholders TPVG portfolio, the development have as the the that yield companies asset to not position also will selective this growth gains by for our our great and believe Holly sake. gains sorry we gains we not only investment construction and with portfolio strategy which profile provide value down on doing another excited both for great we

of covering spillover We to a recent have since have inception income compared track the NII. distribution shortfall and our record of cover plenty to

basis year, levels unnaturally. us market in our indicators track force levels to which commitments now quite this over the and growth, that, I for a have the to call and are increasing performance is now on Our being growth, not and working turn together record our and we we're exceptional starting near-term focused With excited by TPVG. cover meaningful unmatched. Chris. for XXrd to believe large will of several throughout I'll utilization of Jim unfunded we're We've commitment going year pipeline term and but together distribution quarterly portfolio and enable for are consistently signed strong through growth of what's been delivered great higher sheets store rates, portfolio thoughtful cycles

Chris Mathieu

everybody. you, Sajal. Hello, Thank

XXXX. Let me with through the yield of for second million the income financial investment results period. of quarter total on XX.X% $X.X $XXX,XXX including fees, and for of of the million prior-year a share the foreign portfolio second for as Total our gains the investment adjustments investment you and $XXX,XXX fees, favorable million interest pandemic. base $XX.X expense $X.X fair for income were compared favorable million of reflects was changes per quarter, on of million $X.XX loan prior-year quarter take operating lower all administrative second $XXX,XXX of the of amortization $X.XX debt $XX.X a expenses, or million per quarter as debt investments and share of quarter second XX.X% from the compared $X.X compared $XX.X of to million $X.X investments and was portfolio investments and management million that income $X.X because on stable. unrealized of significant start and or Net expenses million for expenses. debt were the exchange recorded fees, million We on investments across of the per XX% incentive major in share, period. expenses Operating since pleased equity the $X.X first for yields categories strong of rates to warrant $XX.X reduction million general lower to for $X.X administrative Net resulting value primarily quarter. for $XXX,XXX. $X.XX or balance activity continue to be and We're the and prepayment Total

redemption or net was complete, quarter, bonds. baby loss a With to result the as realized debt. second the full our positive per extinguishment redemption on April of Xth we expect this one-time This share the of a of asset lower the not During earnings in we effect on year-to-date. covering and company $XXX,XXX $X.XX was despite $XX of Net of net the increase quarterly on and our extinguishment loss one-time continue cost assets increased to going million forward. Net share, debt $X.XX quarter-over-quarter from per distribution. the operations or capital value resulting regular recorded

to distribution XXst, has record quarterly were per quarter $X.XX share, I'm of per million or net $XX.XX of year-end. or stockholders of Directors XXth. $XXX $XX.XX our that a XXst of of assets as or million on total on March per as income compared to million per end, and share $XXX.X September share As pleased a regular as XXth announce share ordinary of to be July Board to declared from August $X.XX paid $XXX.X

We which totaled $XX.X end additional the at distributions to share continue significant per to of quarter retain the or spillover future. the million income, $X.XX support in

distribution As over net to growth investment prepayment regular our expect experience cover further quarterly income, to we to loan income record current we portfolio grow sustained continue levels. to see level a and time

let's to commitments. Now, our move

We of that ended rates commitments are we XX pleased unfunded will if XXXX commitments contractual new interest to will of million have million of not rates. during drawn high utilization to floating $XX these the the expire this with our during million note portfolio quarter unfunded expiration. $XX expire and $XXX of had We companies, have during XXXX total prior XX% commitments to quarter.

prime had a interest XX% quarter quarter-end, which and unfunded All or floor have of of This rates. these three contractual the floating a outstanding existing compares at portfolio to loan higher. commitments rate

quarter, end credit on Now, $XXX the our of outstanding revolving were debt, balances At capacity. credit a there no update just under funding facility, our the term million facility. quick and

the company's trend level of coverage a maintain, of As totaled or and In an of $XXX quarter given issuer strength BBB outstanding portfolio the rating, stable. our million asset April, DVRs ratio with X.XX and the and reasonable and end, leverage we to confirmed long-term term we TPVG's investment-grade, times leverage notes the diversity ratio XXX%. ended quarter outlook of upgraded

compared have today that As execute as of XXst. been sufficient that quarter-end, our the capital funding to on during estimates have the company's call. of We to $XXX million we available total liquidity million, was December provided believe $XXX

over raises flows funding and from from to resulting the successful last a portfolio. healthy debt cash have continue XX We current the substantial months investment capacity ongoing

repayments the prepayments part as see to ongoing natural of loan and continue We and venture diversified important lending and contractual portfolio. a our principal of high-quality

our when will draw grow facility to needed with revolving portfolio credit expect capital benefit debt the under which our accretive We financing, shareholders. to

remarks at could time. questions. So, Operator, prepared this the you we'd to our line please your completes and happy open be this take

Operator

Our begin We question-and-answer session. will now Fargo. O'Shea question Instructions] first from Finian [Operator today Wells with the comes

Finian O'Shea

Hi, everyone, good afternoon.

terms the about equity both First across more often growing call but entrance on and seeing do talk how we in more equity, actually, these venture of pockets are the investment can generally debt board it question, Sajal, talk want demand on into for Jim, just to financial I this competitive going venture in their debt about strategies? landscape talk maybe? about and generally debt you you side. new the Is ask the landscape or about know firms venture their less? to

Jim Labe

venture a requires. not only work a and community that but networking standpoint, with, that specialized just aggressive recall, we're that also entrants and change. this folks working now, or look to from is the why a deal been worry balance capital whole new day, to the about generate the in about we least at in and Finn, and It's it's at is group dabble select the and of investors. segment It in in capital attractive due the which this the Yes. the about be having terms there surely There're end venture Because relationships. be entrepreneurs are try business some of better and not? environment continues continues diligence lending reputation, flow the a not no only competition barriers to ecosystem serving market competitive in and equity we it to that we're there the There with the certainly card we about. of business, yield it references, of venture of at only but that about

the if hasn't least change standpoint, venture to. arena, what in So, been you're competition that's kind any of lending from really referring at there our

Finian O'Shea

Helpful. sure. Yes,

you a not perhaps in that? Another of portfolio, how it's of as comment topline, to the like in would been you on that what but a saw impact recent something something be observe quarter this origination and used level, it but your we've maybe it thinking prepays repays here high trend, decent decent relates and is feels quarters, you to sort but

Sajal Srivastava

Sajal Fin. I companies. quality is What Yes, working This they their with benefits is here. in of is say would the one great companies sponsors of support

So, particularly, our what of year right last uncertainty capital we deployed saw more during investors was VC COVID, the companies. into their portfolio

a raising year. saw of a significant portfolio we particularly saw and activity So, amount prepay we equity result, within as the robust last

I mindset think terms the in the more balance last raise. but it would I there or now seen more we've equity reactive of was year, is in say, the system,

Now, growth. now we're kind to old of are back seeing good folks

regards balance equity debt raises capital the our and to with raising So, raising.

his we're to is, levels looking structure I seeing of would and I of to markets, they activity. they to can normal stabilization that's prepay critical it those part and so interesting equity mentioned prepay year, top back coming well that as say, were fresh because that more those of off funded a the with debt reasons. when seeing comes the Then realize more say cap because think now return to are that last kind is companies I in think, we're So, remarks, I or what Jim

companies for raising are now. I'd and balance definitely, So, seeing debt more that use equity more and are equity say, of we thoughtful both

Finian O'Shea

possible. makes third go sense. for a one I'll Sure, And

little traditional that bit trend a only over time a, but your that's Thank other another you. So, being increasing but BDCs feels ones, me. companies Would these ones. more up portfolio something graduating is we've more you this venture more showing companies those not aggressive? happens from perhaps in And or other that typical BDCs into like describe of seen financing all as

Sajal Srivastava

we're would Yes. companies. of Again, portfolio say I our supportive listen

of platform needs We capacity meet or size transaction of regardless our to their type. have the full

the of the the then stick our debt call and knitting we let's also history and it that benefit through investors when return that between think we and insight of system platform. equity thoughtful with relationships. our I comes farm the those working And have it and balance we again structure to long have to though long-standing because venture of

added also and credit. the We have track of performance insights of the record

So to the companies we all - recognize and so I it's our that. the balance is in credits pedigree that not The it's cheapest. and largest, our we the stay balance about are lose talked about thoughts necessarily Jim return want we profile hope don't risk say everyone and about but not would of and that sees assuming there as

our been term come in So all are in to just you size them doing again that may can't with someone years. market We XX so know again, we've and win going play and sheet [indiscernible] not this ridiculous to stick just and knitting. transaction we we're

or we don't want And so size get more if what price to others, power to they to it. want more regards aggressive with where

Finian O'Shea

Sajal. Thank well. you, Very

Operator

Crispin from Piper Sandler. Love comes question next with Our

Crispin Love

afternoon. Thanks, good Thanks.

up pre-payments about third quarter, then quarter be third through estimate the the talk compared bit I see the little you on first August to third X. and looking Can how the levels. that has just XX should previous second million a with So following pre-payments XQ question, at you quarter quarter. pre-pay and July the similar would to just of

Jim Labe

start some I'll and if Chris, quarter-over-quarter maybe of you then do can the comparison.

So, prepay QX to here I say Crispin, our Welcome. would related primarily activity is fundraising activity. - equity the in

of no they pattern in So July. there I'd pay is say

equity equity regards timing their definitely First with more I raise general, and of or if month all versus of with so not I I'd large equity that to when I a just seeing QX. prepay want and know say the closed regards the balanced. portfolio of to earlier, as comment it I'd definitely Chris, and necessarily rounds think we these this quarter was that mentioned QX so for debt, paying the balanced or or activity some today prepaying companies all prepaid we're to the levels in more where second you month, month companies related say function and questions are in third us off particular of was rounds prior and or that to

Chris Mathieu

that Yes. like business, not not today would there's And It's that short notice. the referenced identified we've a card the is really the past, we're on million just call very credit - much much $XX one seen transaction. measured-only; it's of specifically in add on lot activity. prepayment where I was it's a

third so, for say both then that's first transaction and this would quarter, one the so, I And second consistent that, quarter far quarter.

Crispin Love

mix Okay, companies. those of out million quarter were and the mix just portfolio investments believe what guess at right the now? excited portfolio that existing $XX sub-sectors companies in there. helpful. are about the And Can was you of That's I And debt that new seven then, looking most of the which which was the out just And of a funded same thanks. companies you break sub-sectors then also it you you bare funded second seven? the just

Jim Labe

then work pull-in. backwards Yes. I'll Maybe and to Chris give some time

our of say, this in would new Chris software prepared particularly our the commitment then we the clearly of HealthTech funding. quarter sectors that as good about Fintech, the remarks, think we're what excited I said I in utilization fundings you are e-commerce core and know those deploy So, and we capital or

because unfunded any high one I on that closed customers, more that that were to were this So, had then say I'd add? maybe wanted companies And there follow-on portfolio existing percentage their new percentage commitments. QX quarter in the the new companies believe fundings detail from particularly Chris, transactions actually higher utilize customers. deals two of customers were do you or were

Chris Mathieu

five customers two and existing. new were There Yes.

quarter far new as Sajal referred during consistent his funding well. as prepared commitments and existing very versus had existing to very, with relationships the as remarks in second commitments or actually So,

Crispin Love

Great. questions. Thank taking my you for

Operator

Our Christopher Thalmann. with Nolan from next question Ladenburg comes

Christopher Nolan

say did you that the comments, half? the EPS expect your in to the second cover Chris, you guys. dividend quarterly in Hey,

Chris Mathieu

is our where didn't what level was that. trend What I say get I will originate to to be sustainable. to a it's

So, we on the clearly then that. and to third million, $XXX to the million And need get $XXX track doing fourth for quarter. we're in

Christopher Nolan

of I the market? given debt do the And Jim, guess for raising in What think you implications the venture Great. capital the discussion for strategically, tax. be Washington would gains

Jim Labe

Yes.

the So, venture whole arena. in lending

a and for venture at the Venture side the kind factor grow in terms know tax more the up any capital and we those venture capital. with warrants hasn't issues, things in companies debt lot of equity the a on whether issue debate, prospects side. of attached I losses do due to I gains There's their wants the so more think financing concerns, it's kinds business more in at nature to now, mostly but of come lending of least potential effect in changes business. lot of use be for company companies nature that see as the far to that in not lot lending the the don't of right on also is least

Christopher Nolan

That's you. it from me. Thank

Operator

Our next comes Compass question from Point. with Alexander Casey

Casey Alexander

Hi, good afternoon.

higher scheduled very was principal question, off pay include Just that of as drip one amortization regular but probably full a amortization. like the lot at a by maturity does this to not kind important for quarter, quarterly opposed drip

Jim Labe

remarks. Yes. included million the that his to prepared Casey Sajal $X referred that had in

Casey Alexander

From Prodigy [ph].

Jim Labe

expected. otherwise you lumpier than bit Prodigy. have a Yes, would From little

Sajal Srivastava

Yes.

amortization looking be shouldn't next level quarterly of we at So regular quarter. that

Jim Labe

That's right.

Casey Alexander

encourage made Sajal, Yes, reference, catch I'm I again, I and helpful. could go of and time at to catch utilization didn't it that over have commitments not if quite the okay. forgive quite about you better it be it, would didn't - doing unfunded something the that And me, you you

Sajal Srivastava

Sure, Casey.

those $XX with transactions looked the we we So XX% million funded where as quarter, closed we were of them that obligor's at quarter. in the this

commit six So draw quarter, actually we unfunded drive and this commitment of potentially rather months to entered commitments their drove new for with than the the utilization months having closed. higher then to XX to loan waiting us them on

Casey Alexander

something doing encourage is driving or that there you're to that what that? Is

Sajal Srivastava

channel Not perspective.

I the use again, of the growth the yield were up. it's case the accelerate capital of element are now. discussions growth from perspective how and an would say companies to value companies of kind where up would the them some - utilize using debt these I just went and. went So, say, And warrant of and negotiating a just with in wanted

how little structuring, a bit companies, bit used. it a is little it's a then say bit actually I'd being of and the the of to of So, is capital specific little

Casey Alexander

right, Okay. Thank great. Appreciate All you. it.

Operator

comes Our with next JMP Ryan from Securities. question Devin

Devin Ryan

share, dig pipeline last any a the in afternoon, can little first of maybe Great structure companies. makeup? it's companies pricing see growth on Whether of and more. comparing you there kind just additional the And the other If everyone. Good and color the been to any in evolving? Great. it's bit or is the into the how versus the

Sajal Srivastava

want to do you Jim, take that question? pipeline

Jim Labe

Yes.

is So, the million, the new don't that a rounds if during in this in And literally a other complement a the increased and guess just thing is the, valuations in some raise environment, equity seeing using and all the and pandemic environment on keep in say are remarks the finance interest there rounds step and in them, pipeline but let's primary to some of in and or out say we're call companies. I know and SPAC kind mentioned I the dollars height growth the with of it valuations in versus now debt there after word quarter. to the, one it's of I not were terms those some would more, of $XXX little market bit fears like. about was know prepared huge rate the everything, environment was kinds I today balance $XXX acquisitions even grabbing you of inflationary answered increases pipeline the expecting some last back, on I think of in equity the previous quarter. million to despite the balance And XXXX with way orders, I'd it big of where a current drivers, there question rate now. here this actually over a it's say these your that as of finance per things It using XX% we're using enhance I lot the going once pure debt I I'm at that more

Devin Ryan

Jim. Yes,

Jim Labe

Despite robust…

Devin Ryan

go Yes, ahead.

Jim Labe

it's growth. might add, are companies Devin, focused I I would fundamentally on If the say,

theme growth next and need capital, and balance more round. and now it goes they it's It's is means a so the it's, spend, to they accelerating using back core a private now. right for are of think more so And investors And equity - equity Investors, what debt. to. that I as Jim between referring was

in for and sooner business for for accelerate growth companies companies rewarding focused growth and rewarded milestones because being this top are for the Our on it next alignment this they're investors line it's to rounds. so because for achieving these faster, that's what

to demand. and raising why the strong continues then we just less so that's value And see where the of venture right, than equity to proposition dilutive so, be and continue debt

Devin Ryan

that's just And Thank question get color. then to have you Okay, guys a great clearly, maybe long you. done your bigger time. picture love a here, reaction this

Today, in the think the as about of and evolution are companies quality so you really you space. venture commerce. it's software Fintech or of the And the have this space that whether

that that anything, with picture, And progressed, way. a Some in there that you seen progression it the of have change all been know does your leverage quality. does companies has terms positive or of a given areas environment How comfort thinking they bigger in I just are of attractive. kind on change as an been are as at of kind that areas. quality here, many today but it's those that was call evolution in

on the think your but entire get I that? universe thoughts

Sajal Srivastava

please add. me Yes. I Jim, free to start, feel - and then mean let

capital So we I work. - can again, would comment been say, cycles. only these the of we, that on What we universe through again, Right. funds we've the venture

all strikes would tech what that pet Premier, or equivalent. echelon is stores I same And did I would higher tell of me did funded upper the six an bubble, they probably is XX it's you were companies can years the or eight But thing. they three see ago we're by So you but tier. kind different say, during definitely different

subsectors that funding, we lot companies not great the more not is us of teams, companies, whatever feel or not overlap We're to us I just the it's what seeing yes, makes and some getting think version And overlap, great. again, makes levels fifth more really of lot saw so feel commoditized, there head but great think as were just record a in these activity. I great levels we're equity number. a and head VC strong money it's, There was if despite great investment a funded seeing there funded, as is so which getting

I think, I within those seeing enough. in companies again we're interestingly say levels equity not robust of would because we're environment. increased leverage

should their we their of stage development continue of know vis-à-vis debt, their playbook, milestones enterprise and so representative amount we and a to And value base be. what company a have investor each in

great. solid see done overly things are we've because I companies, that think of I of that. great don't say I kind we're things. been achieving feeling would good and companies, mean great backing But these and doing a perspective, definitely just lot you'll great So, from us get aggressive and

Jim Labe

overused have companies again now, some the I as those business. the we more through involved VC firms has a is before I refined more is Understood long involved it's sectors downs add quality and Yes. absolutely is my the And it's of highest for the only venture progressed long be were years is think the very can some in ups of a lot to venture observation are that developed much there upper learning deals and that really itself but long. span. in just the it's due these But best to market would seen probably in over the span entrepreneurs over we when a times XX haven't of technologies think and use it It's being that ago effect, in and a years that, organized from the today the due of lot quality along I market just all 'XXs understanding. may capital business this see this exciting of successes field recency VC better been the but past. years opportunities and maybe to I more well probably I that and echelon part, in deal money pretty And that is in large started, XX structuring of word the in agree and times. has the progressed lines, exciting. The as debt the much capital, much it's we've

Devin Ryan

it leave Thanks very will there. I agree. I much. Okay,

Operator

with from next Ryan KBW. Our question comes Lynch

Ryan Lynch

afternoon. questions. my Thanks taking good for Hey,

and The it exits XXXX, quarters the prepayments. that look the and to the first first of through venture on market the doesn't I seeing in wanted mean, really space. far activity kind of one, relative in or kind the been elevated outlook exits I two like for in to just so of you're hit kind have in prepayments activity capital

But able And XXXX, we in that just haven't activity you that that again, be and seen expect if guys' expect exits change? is do the Because your that you do that would that in to expect occur the actually [ph]? that and of to venture going so outpace to wondering, increase. the one think I'm given space you would to to half fundings second prepayments

Jim Labe

Sure. Yes, right.

so fundraising, activity equity the say help, would these because We're not take I they're so cash prepayment private of us don't need banks a not due IPO companies on in So, raises banking that capital just we out, exit us has equity for have been M&A financings. it's or primarily off. that their event take paying to to primarily us much

I'll when been pick example, exit, an they as that no prepayment, but for Revolut an we've occurs, not equity time because some, there again on had huge raise paid off prepaid the us So, some huge some event actually is time. ago. exit

companies. I portfolio So, some and would here there, say, clearly do have we

that that's an why may SPAC or as I take-out or the prepaid. But warrants see as historically, result an equity when and seeing a a uplift the the IPO being of we the debt M&A has we're the saw merger, outstanding. say, the been because been we generation SPAC equity the already raise exit and say some event it's prepay in and would have only Let's debt

that we second they're either mentioned, to that from this little we're either I and of saw of off they're in we activity will waiting expect keep year such balance as we where as activity, which again more balances about then balance activity kind think fund-raises, a that prepay year debt unusual our a just to debt, portfolio just or year, more the not companies the are was or think but raises, outstanding last the more much seeing translate we them and coming talking of into ways base growth. core I with of year terms look we the creative pay we're there equity portfolio meaningful end Now, closing definitely to debt paying off prepayment so off are from the fundraising we're this as half early high

Ryan Lynch

Understood. capital color. amounts several Then coming other was, quarters, had last ecosystem. of for I you about, the of question that's really Okay, The lot the the helpful talked amount the this is venture or a exit level SPAC into capital across feels several companies really mergers in robust for of good environment/a capital the engaged capital valuations raising like raising private it's a during significant portfolio the markets. It venture and increasing environment space.

of in the but environment given the coming the more two capital little given as total expected in talked the backdrop that third what you points level guys it's in quarters kind bit surprising space venture big gain values the warrant surprised, in there and in deal that gains the portfolios Revolut, activity would you've and basis have quarter Now, a because how only the a XX robust and with in first just I we're XXXX. raisings as equity you book up that marketplace of activity. have about far I likely you the in is guys understand from do in of are

Jim Labe

valuations want and Chris, comment company do question. Great to valuations? take on private it you equity and

Chris Mathieu

number versus interesting simple of the valuation the much cycle. Yes. public an that. It The not taking it's more we than question. last hold, times It's complicated private is shares as as round just

there as to preferences applied, alike. On range private an a the discounts, company and of acceptable situation be including valuation liquidity that is Revolut and have example, methodologies

valuations call earlier was to SPAC on we impacted about approach those So, talked little of the potential for more the our other the by side. upside are experiencing being bit companies thing on valuation a Sajal portfolio that that the on impact conservative

the process handful we fair today upside, future deals on of already a but price that on value. based you SPAC are that in So, expect there don't current is names value, but

of again, will hidden So, I our all come some de-SPAC going process, portfolio is out think companies private. of in are through in those the kind SPAC time so, gems and over but that ultimate and there there

we substantially have So, preferred stocks, private stock. warrants preferred all

complicated where compared volatile our all to right a is it's between So, portfolio. It's having securities, listed pop bit little public away. more that there see and a you less events those lag in just

from a So, have have might today. that in you portfolio, didn't year we say, other seen the downside ago

Ryan Lynch

Those Have commentary. the appreciate a all my I are good understood. Okay, afternoon. questions.

Operator

over to our session. back I'd Labe for question-and-answer like remarks. This Mr. call the to any closing concludes turn

Jim Labe

operator. you, Thank

As always, all good again, summer August rest next Goodbye. enjoys in and call. continuing We to everyone of again to health. healthy thank everyone a you listening the today's remain We and I'd participating like and the in for quarter. talking Thanks with hope everyone. have forward look very

Operator

The concluded. now today's for conference Thank has presentation. you attending

now disconnect. may You

TriplePoint Venture Growth BDC (TPVG) 5 Aug 212021 Q2 Earnings call transcript