Please note that today's conference is being recorded. I would now like to hand the conference over to CEO, David Nangle. Please go ahead.
Super. Thank you, Radia, and good morning and good afternoon, everybody, and welcome to the VEF Q2 first half 2024 results conference call. Very happy to have you all with us today. The slides for this, as ever, are online on our website, but also through the video portal. And as per usual, myself, and I'm joined by Alexis Koumoudos, our CIO. We'll go through a number of slides, about 15 slides in the next 15 minutes, and then we're very happy to open up to Q&A. Moving to slide number 2, I think the key events of the quarter, top 3 are probably most important here for you, the investor. From an NAV point of view, it's been a flattish performance year to date.
In the quarter, we were off a couple of % in USD and up a couple of % in SEK, given the weakness of the SEK, but up 14% from Q4 2022 lows. I think the key message here that Alexis will go through in a bit more detail, is underlying strength year to date in the portfolio that's driving the NAV, and we like that. But some headwinds in currencies which are exposed to in our local markets, as well as some multiples, from a valuation comms point of view. Feeding off that strength in the general portfolio, specifically, Creditas is always in focus, given it's our size asset and nearly 50% of our NAV, and recently reported its 1Q 2024 numbers itself, and it announced its first profitable quarter. And also, as important, is starting to re-accelerate growth.
So I'll double click on that. But, a key milestone for the company, key milestone for VEF as a key shareholder in that company, and we do love to see growth with profitability coming through in some of our key portfolio companies once again. And that leads more generally into the broad portfolio, where it's just—it's a portfolio that looks a lot better, or look at it month-on-month, week-on-week, year-on-year.
It's now the risk reward is quite nice in what was at one point, a high growth burning portfolio, as was the era and stage of the portfolio, is now majority break even, 90%+ of the portfolio at break even, and now starting to re-accelerate growth in some of the cyclical names like Creditas, Konfío, TransferGo, and then some of the structural names, a lot higher growth than that, and namely, Juspay and Gringo, point to two. But what we're expecting in the next 12 months from a revenue and gross profit point of view, is 30% and 60% weighted growth in that portfolio. So quality, break even, growing, and actually raising capital. The final two points, just a reminder on our bond.
We rolled over our sustainability bond in Q4 of last year to push out the duration to Q4 2026. In tandem with the last bond we did, we released our allocation report, earlier this quarter, allocating that bond monies to similar names that we did the first time around. And finally, just from a regional point of view or from an emerging market point of view, it's been an eventful quarter, in our world, albeit one could argue, it was an eventful quarter for macro and politics in the developed world as well, be it U.S., U.K., and France. But in our world, we had elections in India and Mexico. It's always an eventful period and one in focus, for investors in markets like ours.
We're quite happy to see a continuation of governments under Modi in India, and also the Morena Party winning again, the leftist government in Mexico, albeit with a new president, a female president in Mexico for the first time. So some continuity there in both markets, albeit you get volatility around election time. And then on the macro front, in Brazil, a lot of focus around some of the fiscal constraints from a balance sheet point of view, and the central banks targeting a move on interest rates and the government's opinions on them. But generally, it was a noisy window, and we saw some FX volatility as you do, and notably through the BRL and the MXN, Mexican peso, off 10% each quarter-on-quarter, albeit both have pulled back, as is the way in volatility we see in these names.
Moving on to slide 3, and just key highlight numbers. We have an NAV at the end of the quarter of $436.6 million. As I say, it's off a couple of percent quarter-on-quarter, but broadly flat year-to-date. From a SEK point of view, on a per share basis, we're at 4.45, so that's up from year-end 2023. I guess the key point here from a share price versus NAV per share, which we'll touch on, is the share price has been growing year-to-date faster than the NAV per share, but both directionally positive, and hence that discount is starting to gradually close. From an NAV, this is a dollar point of view. Slide 4 is the chart that we always show.
It shows the evolution of our NAV from a dollar perspective over time. You've kind of seen some consolidation since the downdrag of the highs of 2021. I think the key message to you, the investors, we keep on reiterating that we're starting to see, you know, confidence through the prism of our portfolio of tailwinds coming through in our NAV, and we can see that directionally over time, it is up and to the right, albeit it does gradually consolidate at some point in the cycle. Last slide from my point of view before I pass to Alexis. This is just really around the markets, and we can't get away from public markets. We're big respecters of public markets because public markets read across to private markets, read at valuation, exits, confidence and everything that we do.
Year to date, you'll have seen public markets, as indicated by the Nasdaq and the S&P, up strong year to date, and again in Q2, up 8% Nasdaq and 4% S&P. In our world, in the Fintech world, it's been a flattish year to date, you know, evolution-wise, in terms of indexes and broadly speaking, multiples, albeit a lot of individual variances within that which feed into our valuation process. And Q2 was quite weak. A lot of interest rate sensitivity, given the headlines that were coming through, off 8%-9% indexes in the quarter. And at this point, I'm gonna pass over to Alexis, who's gonna double-click on the whole area of valuations, NAV, and portfolio, and where we are today before it comes back to myself. Alexis?
Thanks, Dave. Good afternoon, good morning, everybody. As Dave mentioned, just gonna double-click a little bit on some of the points that Dave's made. I think the first point here on slide 6 shows the evolution of our valuation marks, and the theme for the quarter is relatively flat and stable. But what's important are the components of that stability. And the underlying trend of like portfolio performance comes through on this slide when you consider some of the headwinds that we've been facing, i.e., weak effects in the quarter and weak public comps. You can see that being the case for both Creditas and Konfío. So, in those cases, we've had FX headwinds of circa 10% in the quarter, and the performance of those portfolio companies offsetting that.
In Juspay's case, there was a double-digit decline in public comps for the payment space, which was almost all offset by Juspay company performance, but not quite. And I think the only one other company to mention on this slide, which has a larger quarterly percentage decline, is Nibo, which experienced both the FX headwinds and public comp headwinds. So the performance of the company and the growth in the company was not enough to offset both of those. One other thing that we do sometimes get questions on is the other bucket. This comprises companies that are less than 1% of the portfolio, or where the mark can't be disclosed due to regulatory restrictions. And in the quarter, the bucket saw an incremental decrease. This is generally because companies...
Because we have become a bit more conservative on the forecast for these smaller companies, and in some cases, there were fresh rounds in which we did not participate in. In one case, there was a down round versus a recent transaction that was Rupeek in India. So that's those accounted for the decline in the other bucket. On the next slide, slide 7, there's been no change quarter-on-quarter to the valuation approach for the portfolio. We still have 13% of the portfolio marked to the latest transaction and 87% marked to market, with over 80%-90% of those mark-to-market valuations incorporating multiples further down the income statement, as we detailed in the last quarter.
I think the important thing to mention here is the direction of travel for the marks over the course of the year will most likely be towards latest transaction as we see more transactions happening in our portfolio companies which then should help increase the confidence and validate our NAV and also create opportunities for realizations over the year. On slide 8 this is our NAV bridge which helps to quantify the drivers of the NAV over the quarter. As you can see the NAV the starting NAV for the first quarter is $448 million moved to $437 million in round numbers. The biggest driver of that was portfolio performance which contributed about 10% in the quarter for the mark to model holdings.
That was quantified at $41 million. That was broadly offset by FX headwinds in the quarter, mainly real and Mexican peso, moving down 10% each in the quarter, which contributed to $32 million of negative NAV contribution. And then you can see that there was a net negative contribution from comps as well, specifically because of the impact of payment comps, and their impact on Juspay, which was comfortably in double digits in the quarter and on a percentage basis. I think on the smaller side of contributions to the NAV move in the quarter, it's worth mentioning that, as you can see here in the latest transaction bucket, there was -$2 million, and that was part of that because of the down round in Rupeek in India.
And then you have some other cash changes and non-cash changes in the corporate bucket. The cash changes being our OpEx and coupon payments and FX being the translation impact from our SEC bond. On slide 9, so you know, sitting halfway through the year, we're feeling very confident, as Dave mentioned, in the portfolio and the outlook for the delivery, and therefore the opportunity for us to compound the NAV from here. I think the key thing to mention is, whilst in the past we've mentioned that 90% of the portfolio or more had the ability to achieve break even, we have now hit that point where over 90% of the portfolio is break even and growing on a self-sustaining basis.
That includes all three of the top names, Creditas, Konfío, and Juspay, but extends beyond that to TransferGo, Solfácil, and Nibo as well. So feeling very confident in the sustainable growth of our portfolio. On top of that, you know, we are now seeing companies turn a corner and starting to accelerate growth from this self-sustaining position. Dave mentioned, we're forecasting a 30% weighted next twelve-month revenue growth number for the portfolio, and 60% on, gross profit basis. And that's, in part driven by Creditas, but contribute to, from the rest of the portfolio. I think we're really moving past the phase of solving for break even for the portfolio, and portfolio companies are now self, fine-tuning the self-sustaining growth and re-accelerating.
And then, the last point to make is that from a position of strength, i.e., you know, well capitalized, and having reached break-even, we're now starting to see investors lean into the portfolio for fundraisers, like has happened at both TransferGo and Gringo. So, you know, these events will help validate our NAV and create opportunities for realizations on the horizon. Dave, back to you.
Super. Thanks, Alexis. Look, moving from a portfolio level, which Alexis delved into, to our most important asset from a size perspective, that's Creditas. You will have seen in Q1 numbers coming out, that they had their first profitable quarter, indicative of what's happening in the portfolio. And as important for future equity value growth potential, they're now starting to re-accelerate growth. I think if you pull back with Creditas, and you look back from our initial investment back in 2016, there's really been three distinct phases of the company, of which it's in phase three. But, you know, phase one was, you know, growth to reach scale, and that was aggressive growth.
That was the growth of the day, that was funded by the venture capital ecosystem, allowing them to grow their franchise, their customer base, their portfolio, their market share, to real size and scale and growing at 100%+ and burning, as we all know, in that period. Then you had the period of 2022 and 2023, you know, partly market force, partly general consolidation, but a real focus on getting to cash flow positive, break even, and be in control of one's forces and, and one's devices going forward. They did that. They're now at that point. And now we're in the phase, let's call it phase three, of profitable growth at scale.
And just be on the phone with Sergio Furio recently, it just feels to be a very comfortable, confident place that the company is in at this point in the cycle. You'll see from the data on slide 10, yes, the gross profit and the net income is very clear. This is reported numbers from the company of where they've got themselves to in terms of cash flow positive. What we will see, and this is not forward-looking guidance or anything, but this is just indicative of what we're seeing happening at the company, that the originations, the portfolio, the revenues will start to tick up now as we get into Q2, Q3, and beyond. It won't be back to that 100% growth of 2015-2019 or 2021, should I say, but this will be more reasonable, robust growth.
Once again, profitable growth at scale. That's what a company that intends to IPO someday needs, to be showing the market quarter-on-quarter for a year, maybe two, before it leans in to do something special. From a share price point of view, the next couple of slides talk about that, our NAV per share premium discount. I think first and foremost, on slide 11, the main thing for us is it's directionally positive. We always say it best, and to the team, to our board and our shareholders, it's gradual. In everything we do, it's focus, it's delivery, but we want things moving forward and gradually positive. And that's what's happening with our share price. That's what's happening to our discount to NAV.
It is moving in the right direction, and we're using all the triggers we can to get there as soon as possible. As I say to shareholders when we're marketing and, and to ourselves and shareholders, there's two very clear forces at work here, which are gonna see a good return on share price or shareholder investment. And that is one, an increase in NAV, of which a quality portfolio compounding is key, and the second is gradually or quickly reducing that NAV discount. And those two forces clearly give you the upside you've had year to date in the share price. Slide 12, we've played with this a bit to give a, a different perspective on how we're looking to close the discount to NAV, but a lot of the same kind of narrative is there.
I think first and foremost, what we're seeing is, you know, discounts do persist, in both VEF and the industry at large. But once again, we are seeing those discounts from a sector point of view, starting to come down. They're directionally positive. And also, there's a bit of quality differentiation from investors as well, as investors are starting to hoard or move towards the more quality names with the better portfolios, and we would like to think that we are in that pack. That's one aspect of what's happening here. On a micro level, I think what's important for us to close the discount, first and foremost, is the portfolio. It's those companies reporting, delivering credit tasks within it, which is the most public, of our private companies.
It's us, as stewards of this capital and communicating that story well through investor relations and PR, and you will see a lot more, and you have seen a lot more from us on that front. It's our companies raising capital, which once again, compounds the NAV marks that we put out there based on our own workings and valuation. But I think finally, and it's very clear to you and to us, that exits are real. That's when a NAV mark becomes very real, and that's when cash comes in. And that's something that we're looking to and confident we can deliver on in 2024 into 2025. And that's, that's the goal for us and what we're saying to you, and we've said that to our investors over the last few quarters.
That capital, in besides, you know, reaffirming the NAV mark that we have plus, minus, also gives us the capital that we need, want to strengthen our balance sheet. That capital goes straight to areas like paying down our debt and or, and buying back our equity, because they're the two most obvious things we can do with any dollar coming in right now, beyond getting back to investing and putting money to work in pipeline, which is very clear for long term value creation, both for us and our shareholders. From a capital position, this is an extrapolation of last quarter's data. Nothing that you wouldn't be able to see or work out from what we've shown, but we end the quarter with nearly $16 million of cash capital on balance sheet.
We will end year-end 2024 with $10.9 million. We did roll over our bond, as I mentioned, to year-end 2026. Our bonds are trading very well, and we look forward to our equity doing likewise. At the end of the quarter, we're in a net cash negative $22.2 million position, given the liquidity position and the bond outstanding. As a reminder, we did pay down 100 million SEK or $10 million of that 500 million SEK bond in Q4 of last year. It's worth touching upon our Sustainability Bond because it is a key part of our cap structure, and the bond markets in Sweden have been very good to us and very supportive into our second iteration of that bond at better pricing.
We put out our allocation report, in the quarter, and once again, we allotted that money to companies which feed within the sustainability bond framework, namely Konfío, Solfácil, Rupeek and Mahaana. So the same, very similar, and similar allocations, to the last bond. Finally, just to wrap up, and then we'll get into questions from the floor. But, you know, from our side, I think what you're hearing in this presentation is that it's all about the portfolio. Investment companies like ours have a lot of aspects which help them succeed, in life over time. But if you haven't got a quality portfolio under the hood, you are in trouble. We are the opposite of that. We're very confident in our portfolio. The top seven names specifically stick out. They're 95% of our NAV.
And as Alexis, you know, double clicked on around profitability, 90%+, quality, growing. You know, one thing is being profitable, we need growth. We're in growth markets, we're in a growth sector, and that's starting to not just come through, but ramp up in a lot of our names. And then capital is coming through to reaffirm NAV marks and give the companies in our portfolio more capital for more growth, and more expansion. I think around now, tailwinds. We want us to be careful. There's many aspects to NAV, be it the underlying portfolio company performance into FX, into multiples and markets.
But from what we can see, obviously, what we can control, but what we can see, we're very close to our companies. We're very confident on the NAV evolution through the prism of our company's performance, and that comes through obviously from a valuation perspective, looking ahead. And then balance sheets trade at discounts, and this area is something that we think a lot and focus a lot on. It is a priority. It is the top priority to strengthen the balance sheet, and that comes into the area of exits. And what we can say on the exits front is that we are working on a number of situations, general comments within the portfolio, for partial exits as opposed to full exits.
We'd like to think that we can deliver it within 2024 and 2025, a number of exits, which will fit into strengthening balance sheets at the right price from the right situations. That goes in tandem with our share price and our share price evolution. I'd like to think they're connected. One happens, the other will happen also. But we need to communicate well, we need to deliver, and our portfolio companies are doing that as well. So I like the direction of travel of the share price year to date. We just need more of the same or a lot more to go by year end. And then the big thing for us is getting back to investing, because there's short-term value creation for our investors, short to medium term, around the balance sheet, strengthening exits into the share price.
Then there's the long, medium to longer term, which is really about finding the next Creditas Gringo Juspay, which we're starting to do again, and we're looking forward to getting those into our portfolio as we go. Operator, I will stop there, and we will open the floor to questions, please.
Thank you. As a reminder, to ask a question, please press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Once again, please press star one and one on your telephone and wait for your name to be announced. Thank you. We are now going to proceed with our first question. The question's come from the line of Linus Sigurdson. Please ask your question. Your line is open.
All right. Thank you and good afternoon. So starting off, I mean, looking at your expectation of 60% gross profit growth, seems that is down from 65 in the last quarter. Could you just elaborate a bit on what's driving that change? Thank you.
Hey, Linus. What's up? Thanks for the question. I wouldn't say it's a big move from 65 to 60, but we hear you. And Alexis, would you mind grabbing that one?
Yeah, I would say, Linus, you know, what's been driving some of the faster gross profit growth versus revenues is obviously margin expansion and these companies reaching or, like, approaching steady-state margins. I think what you're seeing in that slight slowdown is as we roll forward one quarter, the margin expansion isn't going to be happening at as quicker rate. And so that's why you're seeing a slightly. I, you know, so I, I wouldn't say it's a reflection on the growth of the quality of the businesses, but it becomes incrementally harder to get that gross margin expansion quarter on quarter.
... No, right, understood. And then, I mean, a bit of a broader question, if I may. If we look a bit further out beyond sort of any potential exits and so on, I mean, I would assume you're already looking at a number of potential targets for new investments. Could-- It would be interesting to hear you talk about sort of what you're looking at in that area and where in the world. Thank you.
No, thanks, Linus. It's a very fair question, and, and let me talk generally, and maybe Alexis, feel free to layer in after specifically. But look, we spent nearly 10 years in this industry, Linus, building VEF into what it is today. Through the prism of our listed share, we have a team and a deep bench of experts who keep on scouring the emerging world for Fintech assets of note that we want in our portfolio, and we've got some of the best capital providers on the supporting us to go get there, and make sure that we all benefit from them.
That worked very well in the first seven years of what we were at, and the last couple of years have been a consolidation phase, mainly for market forces reasons, and hence we're talking about balance sheet strengthening, and exits of some names within the portfolio, which many of which are still performing exceptionally well. We never stop looking for the next Creditas, Tinkoffs, Easycos, Juspay. That's what we're constantly doing. What I'd say in the last couple of years, 2022 and 2023, they just haven't been there. Well, the companies have been there, but the opportunity to invest hasn't been there. It's been a theoretical buyer's market, but it's been reality. There hasn't been a lot of deals done because companies haven't wanted to raise or get out there unless they had to.
What we're seeing in 2024, though, is an opening up of that. From our side, on a general basis, the early stage capital has kept on going through in local markets, in Brazil, Mexico, India, many of the markets that we look at, and we're seeing a fresh iteration of growth stage companies, Series BC. That, that's always been our sweet spot. That's when we've come into Konfío, into Creditas, into iyzico. They're starting to come out, they're starting to bloom, and we're starting to see them again. So we're doing work on a range of companies in this era.
Also, what we've seen is companies that we liked on the way up in 2019 through to 2021, in a variety of countries and segments, that were quality Fintech companies, quite clearly that will be scale champions, but they were just priced to the hilt, and we looked away in that window. And what's happened is, these companies have consolidated, they've delivered, they're now profitable, and they're raising, but they're raising at more realistic valuations in this new cycle. So what I'd say, generally speaking, is it's starting to get to that investment window again, and it's kind of the window where we would like to lean in when we get ourselves in that place to do it. Now, this doesn't become a 3-month window, and it's closed. It can be a 3-year, 5-year window, as we've seen before.
But those opportunities are starting to show their head again, and those excite us. You know, that's a lot of what we're about. Alexis, do you want to add on to that?
Yeah, I just overlay a little bit with, from what Dave's saying, like, these opportunities are starting to rear their head. I think where we're seeing them is predominantly like in our big core markets, the ones that we know really well, where we have a good presence and a good reputation. So we, we're seeing a lot of, a lot of these deals are still, like, coming across our desk. And I think there are some, like, interesting themes as well in our portfolio, where we've become deeper because of our portfolio involvement in those themes, and so we feel that we've become more expert at them, and, yeah, I think there's... It continues to be great opportunities in our, like, in our wheelhouse, I'd say, to start to execute on as and when we bring in more capital.
That's very helpful. That's it for me. Thank you.
Super. Thanks, Linus.
Thank you. Once again, as a reminder to ask your question, please press star one and one on your telephone and wait for your name to be announced. Once again, it's star one and one for any question. We are now going to proceed with our next question. The questions come from the line of Herman Carrick. Please ask your question. Your line is open.
Good afternoon, gents, and thanks for taking my questions. So, maybe if we start off, could you tell us or give us some indication about how large percentage of your portfolio you expect to be out raising capital in H2 or the coming twelve months? Because, I mean, it ties into both your statements about exit, I suppose, because this could be a good opportunity for you to piggyback, but also on the confidence of NAV growing from here. I suppose the easiest way to have that crystallize is if you have new rounds with fresh transaction values you could use on your NAV.
Yeah, super. Hey, Herman. Thanks for that. So what I'd say is markets are open, they are active. They're nowhere near, obviously, 2021 or 2020, but what we've seen in the market and then obviously through the prism of ourselves with Gringo and TransferGo, is capital is being raised from good investors at decent valuations, so that's a healthy backdrop. Then you've got cross-reference with a portfolio like ours, which is now cash flow positive, 90%+. And then there's a need and there's versus a want for capital. And a lot of our companies do not need capital, but a lot of them want capital, because with incremental capital in a window like this, you can do more, be that more balance sheet growth, it can be acquisition of smaller names which aren't going to make it, and consolidation, etc.
So there is that want for capital from a number of our companies. What I would say is active in the market or slightly active in the market, would be in the range of 3-6 companies in our portfolio, out there having discussions people have come to them or they're going out to the market having discussions. So there's no one overtly out there raising, and actually, TransferGo wasn't out there overtly raising, but money did come, to them. So I would be disappointed by year-end if we didn't see at least 2 more transactions in our portfolio. Gotta be careful what I said. It's always fluid, timeline's always fluid, and then you can define what a transaction is, whether it's internal capital or internal plus external, and the size.
But we're definitely in that zone where, like the two that I've already mentioned, there will be more this year into next year, given everything we see right now. And then you cross-reference that with the exit opportunity for us as investors, and there's many ways to define exit, and the most simple is an M&A or an IPO and a full exit of a company, albeit IPOs are partial into full over time. But the other area is, you know, slicing or top slicing your position as a public market investor would. They owned, you know, a lot of Handelsbanken or, you know, I don't know, any listed PayPal company, and they wanted to take some money off the table, but they wanted to keep the position, they just sell 10%.
The same thing happens in the private world, where we are long quality assets, which we want to keep in the portfolio compound, but into any secondary or into any primary placement that these companies are doing, you get a price round, you get overdemand, you get interest from extra investors who want in beyond the amount that the company's raising. That then does create opportunities for us as potential sellers. So this is something we're very aware of, we're very much working on, and it does help that companies in our portfolio are or will raise capital this year into next.
That's super helpful. Thanks. Then, I mean, you, you, you've highlighted how Gringo and TransferGo did new rounds at or above the most recent marks you had for them, which, which I think has been quite helpful to kinda show that your NAV is holding up. I suppose Rupeek, could we get any more details on that one, how it deviated to your most recent mark on it, and if there's any specifics, why that was perhaps a down round also compared to your most recent mark?
Yeah, that's fair. We should always, we should be balanced in our approach in talking about those companies doing exceptionally well versus those taking on a bit, a bit of pain. I think we've been balanced through cycle by talking about the JUMOs and the Magnetises and the Guiabolsos, as well as the, the Tinkoffs and the iyzicos. Alexis, would you mind taking that and sharing what you can?
Yeah, sure. Yeah, so there is some information I can share. So Rupeek raised a round earlier on this year, and they raised from a good large investor. They raised a sizable amount. It was, I think, $6 million. And then-
Mm.
So we moved our mark in Rupeek to that latest transaction, and that happened, like, in the early part of this year. And then they were out looking to fundraise from some other VCs. Some other VCs approached them with additional opportunities to take in more capital. This was a much more sizable amount of capital, like $15 million. But they gradually chipped away at price, like, as the negotiation for the round continued and Rupeek decided, the board and the investors at Rupeek and management decided it's in the best interest of the company to take the capital today, even if it meant a down round versus actually quite a recent latest transaction. And so that's, that kind of explains the evolution of the marks there.
It wasn't that we'd, you know, moved it to a mark to model, and then we were completely wrong on price. It was that there were two back-to-back transactions, and they were differently priced. The company decided that it was in their best interest to take the capital rather than not.
Okay. How about that? That's, that's very fair. Then last question for me would be, you touched a little bit about, where you're seeing opportunities going forward for, for new investments, but, but could you maybe drill down on that even more? I think you mentioned like an Uzbekistan opportunity. That's not a country I would have expected you to talk about, perhaps. Is that just a pure one-off? And generally, how do you balance that, kind of taking a one-off investment in a market versus... I mean, you've talked about Indonesia several times. We know India, Brazil are core markets for VEF. Just how to think about that, and perhaps if I could add to that one also, if there's any specific segments or themes within Fintech you're particularly interested in currently.
Cool. I'll deal with Uzbekistan and that first point, and Alexis, be ready to get into specific themes and areas. But I was warned not to use the word Uzbekistan, because it turns out that it's a word that everybody's grabbed onto in all the aspects of what we've reported so far, so I've got a lot of questions on that. Look, let's be clear, from a strategy point of view, we do EM, emerging markets or growth markets and Fintech. Brazil, India remain the core of what we are in the portfolio and where we're focused into Mexico, and Indonesia is still a big part of the work that we're doing internally, focused analysts, and pipeline building. So those big four do not change.
Around that, what we've seen in the last 12 months, to my, I'd say my delight is, you know, as much as Russia's gone off menu, Turkey's come back on menu. And it's been a while, and we've had a great experience, good relationships and partners of being in the Turkish market through the prism of iyzico, and we've always tracked it from afar. But now we're starting to see companies coming through and real capital being raised again as the market's appetite for Turkey and Turkey Fintech has improved. On a personal level, obviously, the former Soviet states is something that I have a history of focusing on.
Think of in Russia, obviously, Kaspi is one of the benchmark fintech companies coming out of Kazakhstan, probably up there with Nubank, as the two benchmark EM fintech companies that everybody wants to be associated with for all the right reasons. You have a lot of other countries within the former Soviet Union, including countries like Georgia, Uzbekistan, current market. I would love to meet coming up, a la Kaspi, in these markets. And for a team and individual who is as connected in this world, that region, and has had experience and success, you know, we've always kept our finger on the pulse there. So recently went down a bit of an Uzbek rabbit hole. It is the most populous country, in that part of the world, and we're looking at analogies of Kaspi and what they delivered in Kazakhstan.
And we've seen two or three assets, let's call them, coming out from an early stage in that market in different ways. So it's caught our attention. It's getting work. We do lots of work on lots of different things, and it was ripe while I was writing the management letter, hence, it found its way in there at the same time. We're not going all in on Uzbekistan anytime soon. It was just to show that the breadth and depth of our knowledge and our reach, you know, a la what we did in, you know, looking at Nigeria, Egypt, Pakistan, in the past. More focused answer to that, Alexis, do you wanna layer in?
Yeah, sure. On themes and specifically what we're seeing, so as Dave mentioned, you know, we continue to stay relatively focused on, like, our core markets, and I think the opportunity varies quite a bit from market to market. But generally speaking, I would say we continue to, like, really like the opportunity in our core markets for payments. And that is either, you know, looking at new pipeline opportunities there or actually helping portfolio companies succeed and expand into some of our markets for payments. So, you know, Juspay has spoken about international expansion, and more recently, we've really been leaning in and helping them to evaluate the opportunity in some of our other markets, and then introduce them to partners and merchants there. I'd also say, like, embedded finance continues to be a very big theme.
A bit like, you know, the Solfácil and Gringo investments, we're seeing more and more opportunities like that, where there's great, great businesses that have the opportunity to capitalize on very large user bases with financial services, be it payments or credit, but on the face of it, might not look like fintech businesses. And then, in some other markets, we're looking at, like, cross-border financing themes, where you're seeing, like, nearshoring trends. And, yeah, I'd say those are, like, the big themes that we've been looking at of late.
That's super helpful. Thanks for taking the questions.
Thanks, Herman.
Have a nice summer.
You, too.
We have no further questions at this time. I'll now hand back to you, David Nangle, for closing remarks.
Super. Thank you. Look, thank you, everybody, for taking the time to be with us. Obviously, middle of summer, you've got better things to do. But I think the message is clear from our side. It's really about the quality of the portfolio, and that's where the compounding short to medium-term value comes from. And then we need to balance that with strengthening the balance sheet, getting the share price moving, and looking at medium to longer term value creation. That's through the prism of getting investing again and into pipeline, which we're very excited about. Any questions, as always, always feel free to come back to us direct, and we look forward to seeing you soon. Thank you.
This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you.