Good day, and thank you for standing by. Welcome to the VEF fourth quarter 2023 earnings call and webcast. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please note that today's conference is being recorded. I would now like to hand the conference over to your speaker, David Nangle, CEO. Please go ahead, sir.
Thank you very much, operator, and welcome everybody to our Q4 year-end 2023 results presentation after the results released earlier on today. As always, I've got our CIO, Alexis Koumoudos, with me today on the call, and we'll go back and forth through the slides, which are available on the webcast that we're going through, as well as on our website. We'll spend about 20 minutes working our way through the slides in the usual format, giving you guys an update on what's been happening at VEF in the last quarter and indeed the last 12 months, with some outlook guidance for 2024. But getting into the slides, on slide 2, just the key events of the quarter, what's worth highlighting, and what will we get into as we get into the deck.
I think first and foremost, it's around the NAV, and NAV moving in the right direction through Q4 and 2023. On average, we're up 5% on the quarter in dollar terms, and 16% for the year. That's a directionally positive move, quarter on quarter sequentially, after the pullback that we and the market had in 2022. So it's nice to have those tailwinds back, and that's been a number of factors feeding into those micro-level performance within the NAV, be it markets, macro, currencies, and indeed, the company performances in our portfolio. Specifically, Creditas, which is approximately 40% of our NAV and are still our biggest holding, and our North Star. Very clear communication from Creditas and us for Creditas on their priorities.
In this window, it's been prioritizing a path towards profitability, moderating growth as it got there, and that's been coming through in the numbers as we see. You know, back before 2021, it was about growth and burn as they built market share, 2021- 2023, prioritizing profitability, with 2024 being a balanced growth profitability drive for Creditas as a business as it looks towards an IPO. India is a market where we have three of our 15 holdings today, and it's one which we obviously are on the ground every quarter, but we brought our board there in Q4 of 2023. It was a fresh event just to look at that market through the prism of our board.
It's clear, it's clear, it's also clear to them why it's one of the most promising emerging markets, not just for fintech, but I think for growth in general. It's a top two geography for VEF at this point in our cycle, along with Brazil. I'll get Alexis to focus on the Indian market for us within this presentation, to double click on that market, why we like it so much, with a focus on Juspay within that, which is about 15% of our NAV and a real rising star and a value creator for us as a company. It's also worth talking about the future.
A lot of the value, clearly, for VEF investors is in the portfolio today and what you see, but a lot of it's also in the team and the platform, the relationships and the track record that we've built, and that will be able to take part in the next cycle, which is starting to evolve in venture investing. So we'll double click on that as well in the presentation as we get down to the positive moving parts and what we're doing to try and take advantage of them as we look forward. And then the final kind of key event of the quarter was our bond refinancing. We redeemed our existing bonds, issued new ones, pushed out the maturity, improved the terms of those bonds.
Just real balance sheet and risk management, and something that we're always looking to do as a company, to balance and manage the firm as a whole, as well as the investments that we're looking to do. So moving on to slide number three, just a couple of key numbers. We did end the year 2023 with a NAV of $442 million. Slightly lower quarter on quarter from a SEK point of view, albeit up in dollars. The SEK move versus the dollar was a 9% positive swing for the SEK, and that obviously affected the difference in movements in the quarter. On a per share basis, people tend to look at the SEK, from our NAV per share.
It was at 4.26, and that compares clearly to our share price trading under 2 SEK a share, albeit it's having a good day today off the back of our results. On slide four, you got the NAV evolution in dollar terms over time. It has been a gradual up and to the right, and as we always say, had a spike in the middle, which is 2021, when valuations went massively up and to the right before pulling back in 2022. We have stability in the NAV, clearly in a dollar level since then, and a gradual uplift through the year of 2023, as I said, 16% year on year, and we're looking for that to continue as we look forward.
Getting into the markets, which are tailwinds through what we do, or at least they have been in 2023. Strong performance from the fintech indices, 42% year-on-year and 27%—sorry, quarter-on-quarter, for the ARK and the FINX. Also markets as a whole, be it the Nasdaq, S&P, were very supportive for what we did. Prices were up a lot, multiples weren't up as much as Alexis will get into, and obviously a lot of this feeds through to our individual portfolio companies, albeit with specific comps and not market index-based evaluation. And the final one for me for now, before I pass to Alexis to talk about valuations in our portfolio in the quarter a bit more.
You know, a number of our companies were up in value in the quarter, notably the top three, to different extents based on the input parts, from Creditas up 3% quarter-on-quarter to Konfio, a more comprehensive 19% quarter-on-quarter, and some pullback in TransferGo, once again, with comps related, which Alexis will get into. But those moving parts all fed into an NAV uplift in the quarter, which is the most important aggregate note to take away.
... Alexis, do you want to take the next few slides and just get into valuation approach details and what happened over the quarter, please?
Sure, Dave. Hi, everyone. That's a great segue for slide 6, where I'll take you through some of the highlights of some of the most significant changes in NAV on a portfolio company basis in the quarter. Starting with Konfio, which increased 19% quarter-on-quarter. The mark increased 19% quarter-on-quarter. About half of that was driven by the median comp base, which increased around 10% quarter-on-quarter. And then the rest came from rolling our forecast forward, i.e., growth in the company and FX strength in the quarter. Juspay is also one to highlight, where we saw 11% growth quarter-on-quarter in our NAV mark.
Again, a large part of this was the recovery in the median comps and the payment comp group that we use there, and rolling those forecasts forward one quarter growth. I think the third name to highlight is Creditas. Creditas benefited, but to a smaller extent, versus Konfio from a median comp recovery. There was also a slightly more muted forecasting growth as it runs a couple of quarters behind Konfio in growth recovery. And some of this, some of those net positive impacts were impacted by dilution from a convertible round, which crystallized in the fourth quarter, and also some cash burn, which we'll mention a little bit in the NAV bridge later on in the presentation.
Another notable increase, which is further down the ranks, but a significant quarter-on-quarter change is Solfacil, where we saw very large growth in median comp multiples, and they benefited from a very strong finish to the year. The last quarter was very strong. Therefore, the underlying growth of Solfacil. To balance this, I'll just highlight a couple of the names that had a negative trajectory quarter-on-quarter. One of which is TransferGo, where the company continued to deliver very well. We just saw the median comp within the group retreat a bit in the fourth quarter, so it's essentially driven by one comp.
And then on BlackBuck, a bit further down the order, there were some adjustments have been made to the business and our business plan as the company formalizes its move towards an IPO, which is targeted for 2025. So we've made up some adjustments to our business plan, which has resulted to that, but we feel comfortable that it's growing from a new base of strength, into a what can be a very positive event in 2025. Just on the next page, Dave. So this is, a summary of where we stand in terms of the methodologies for valuation of our portfolio companies. Of the 14 portfolio companies, 10 are marked to market, representing 93% of our NAV, and four are based on latest transactions, which represent 7% of our NAV.
And you can see the bulk of those transactions, how recent they were and how significant they were. There's no real change in methodologies from quarter to quarter. I think the only thing to highlight here is our portfolio has shrunk by 2 portfolio companies, which fall into the other category. Those are Magnetis and JUMO, which have left the portfolio, and we'll cover that a little bit later in the call. On page eight, we've, we're presenting our regular disclosures here, but so as Dave mentioned, over the course of 2023, our NAV saw 16% organic growth, which is driven by the underlying growth and valuations of our portfolio companies. And our, the valuation of our portfolio companies reflect today's environment, we feel, with 93% mark to market and 7% on very recent significant transactions.
The portfolio next twelve-month revenue growth projection, which we show each quarter, is at 35% as we roll forward one quarter from the previous quarter. It's come down a bit from the previous quarter. I think when we look into this, this really reflects that the more mature and large portfolio companies represent a larger portion of our NAV. But we also find this to be a very healthy growth rate, considering the bulk of our portfolio is now growing from a profitable base. And then the last point on this slide is that 94% of our portfolio is now at or can reach breakeven with existing capital, and the remaining 6% have 21 months of runway. So we feel very comfortable with the runway, and the sustainability of our portfolio without the need for further capital.
Page nine, this is the usual bridge that we show, which helps to explain the contributors and the attribution of growth of our NAV quarter-on-quarter. As you can see in this, the bulk of the NAV growth over the quarter is driven by changes in comp multiples within the mark-to-market valuation methodology. That was complemented in the quarter by FX tailwinds, specifically from the BRL and the Mexican peso, as well as underlying portfolio growth of our portfolio companies. The largest headwind in the quarter falls into the other category, and this relates to net dilution in portfolio companies. In particular, the biggest contributor to this is the effect of the convertible note on our Creditas stake.
The fact that the convertible note portion of our holding did not increase to the same extent over the quarter, and then also changes in our cash position of portfolio companies. We are at a point in the portfolio now where companies are growing from a profitable base, and so the impact of that is becoming smaller and smaller, as we look forward. Other impacts to highlight here, I think, are the corporate cash, which reflects our OPEX coupon payments and costs related to the bond refinancing in the quarter. And then also FX. The FX category is related to the translation impact of our SEK bond and the fact that the SEK appreciated over the quarter.
But I'd like to leave you with the overall message that, you know, this is a positive trend, which we feel will continue as we look forward, driven by the rebased portfolio of business plans and the fact that a large portion of our portfolio will now be growing from a profitable base in 2024. And as we keep a close eye on costs at VEF, the combination of these factors will continue to drive our shareholder value and NAV per share. Dave, back to you.
Yeah. Thanks, Alex. So let me say a couple of words on Creditas as our biggest holding before I pass it back to Alexis to talk about India and Juspay within that. So you're getting a feel for two of our top three holdings. But as always, Creditas do provide data for you, the investor base, at a headline level. And I guess it's really been a good narrative and good transparency as they have communicated what they want to do this year and pretty much delivered upon it. And what that means is you're seeing the portfolio broadly static, slightly up year-over-year. In 2023, they reduced growth, moderated growth, and the idea was to squeeze up revenues or drive revenues through higher margins. Now we're starting to see the rates come down in Brazil.
It's going to help cost of funds. The gross profit margin itself has come from a low of 12% to north of 30% and rising. And the cost base is much more efficient and CAC is lower. So you're getting to a place where they're just tipping points on cash flow positive or breakeven, and that's where they wanted to be, and that's been the communication with the market. So as I said, from a Creditas investor point of view, we've been with the company a number of years. It's been the rampant growth phase of the 2021, obviously, the euphoric market, and they have the capital to do it. But that was when they built their size, their scale, their team, their franchise, their brand, and their market share. And that came with burn, as it does with a lot of these startup companies.
The last couple of years has been about getting income statement fit and cash flow positive, while also strengthening the balance sheet. As we reported and they reported in Q4, they did a $75 million convertible note, and that was internally supported across the board, as well as in their first international bond. So a lot more capital has gone into the balance sheet, while the income statement looks a hell of a lot healthier as they look into 2024. And then I think if you look at this slide, I point this a lot, but everyone talks about inflation and rates globally, and have we peaked? And it seems we have peaked, and they will start to come down. To what extent and when?
Brazil is already happening, they've had 4 rate cuts already, in the back end of last year, with more expected to come this year. So we're down from a peak of 13.75%, to 11.75% today. That's the base Selic rate in Brazil. Looking at 9% consensus for year-end. Why is that important? Because Brazil is a very cyclical country, and Creditas is a credit play, as is Solfacil, as is FinanZero. These are all plays on the credit cycle in Brazil, and we're moving back into a fresh credit cycle, which means growth, which means better margins, which means better asset quality. We've lived through the opposite over the last 2 years. We're looking forward to enjoying the benefits of that trend as we look forward.
So the key message on Creditas is profitable growth in 2024, with the eye of an IPO on 2025, and Sergio's been in local press with that narrative of late. Alexis, can you talk us through India, just the top level, as well as getting down to Juspay and what we like there off the back of our recent trip?
Absolutely. So, as Dave mentioned a bit earlier in the call, in November last year, we restarted our tradition of holding one of our board meetings in geography every year, and as India's become more and more important to the VEF story, we decided to host that in Bangalore. I think everybody came away... It was great to have the whole team there and the board there, and I think everybody came away feeling very, very positive about the opportunity in India, and that we've gone from-... like pre-2018, really observing and learning from India, and finding it a complex and competitive market, to really getting involved and now making investments, and having a lot more to do there.
So what we wanted to do was just relay that a little bit to investors, in some of these slides. I think some of the highlights of why we love the opportunity in India is, clearly it's now the most populous country in the world, with over 600 smartphone users. The combination of cheap data and the government drive have led to India becoming the number one economy for digital transactions. And government-sponsored innovations like Aadhaar, UPI, and OCEN, have really resulted in probably the most advanced public infrastructure on which Fintech is being built. The regulators have also played an important role in cultivating innovation with a progressive mindset. And the deep pools of dedicated and international capital, which are focused on India, are really driving investments, innovation, and cultivating an environment for exits.
So what we found, the combination of all of these factors, is that it's resulted in one of the deepest fintech ecosystems in emerging markets, with over $30 billion of private fintech financing since 2014. And we're now beginning to see a cohort of really successful IPOs. So, you know, coming away feeling really positive about the opportunity here for fintech. Dave, on the next slide, just highlighting some of the investments that we've made into this opportunity. Over the course of 2020 to 2022, we made 3 investments in different fintech verticals that excited us most. I think, you know, the most important one for our story so far has been payments and Juspay. It's a scale opportunity with huge tailwinds from digital adoption and government support.
And the complexity of payments and friction for merchants is a very real problem. The fact that there are slim unit economics, and the fact that it's a complex space to play in, creates deep moats for leaders like Juspay. On the secured lending side, we invested in Rupeek, which is a gold-backed lender. And India's got one of the largest credit gaps to solve globally. There's a huge portion of new to credit and thin-file clients, and there's $1.5 trillion of unproductive gold sat in Indian households. So this represents a big opportunity for Rupeek to help create productive loans from the unproductive assets at fair prices to a large chunk of India, which is new to credit.
And then in the embedded fintech space, we made an investment in BlackBuck, which is effectively digitizing payments for the operation for 1.5 million truckers that own 3.5 million trucks, which are essentially the backbone of production for India. So across these three investments, we've invested $45 million in three years, which today represents $89 million invested NAV, as at the end of the fourth quarter. And we've built deep relationships and reputations locally to continue succeeding and growing something in India that we're all excited about and we feel could be as big as what we've done in Brazil today. On... Sorry. No, go on. Sorry. Go for it.
Yeah, and then on the next slide, I just wanted to touch on, you know, Juspay and, convey some of the excitement that I think the whole team got from spending time in Juspay's offices, and our board being able to interact with the broader team on the ground in their offices. You know, the scale of what Juspay have achieved, I think, continues to amaze all of us and just the scale of the opportunity in India. I was actually on a Juspay board call today, and they're comfortably north of $100 billion of annualized TPV. They are growing at a very, very healthy clip. They had some days in December where they did over 100 million transactions in a day.
There are 1.5 billion downloads on of Juspay's SDK and apps in India, and clients really do love them. They are deeply, deeply integrated with their clients with very, very low churn. They're solving very complex payments problems for merchants, banks, and big tech, including Google Pay. And I think, you know, there's a lot of upside to where Juspay can go. They're just scratching the surface. But what we're seeing with Juspay as well, and you know, India has blazed this trail into digital transactions and payments, and some of the rest of the world is starting to go in a similar direction. And Juspay's clients are asking Juspay to help them solve similar challenges in some of their other markets.
So we're seeing Juspay move to some international markets, with their existing clients, with the launch of their product, Hyperswitch. So we're super excited about Juspay.
Cool. Look, really worth digging into Alexis and sharing with our investors because of just the importance of this asset for us, not just today, but given where it's going tomorrow also. But, like, you know, a bit like when we talk about our NAV evolution, it's good to give a fair reflection of everything going on, and we don't get everything right at VEF, as we've seen in the past. You know, for every investment that we make, like a Tinkoff or an iyzico, that goes to the stars, and we like to shout about because that's the nature of the beast. And we've got names like Guiabolso also, where we've invested and the investments have effectively failed. But two investment companies or two portfolio companies are leaving the portfolio in Q4.
Basically, investments that haven't worked out for us and for our shareholders. Alexis, why don't you take us through briefly Magnetis, and I'll do Jumo and wrap up. But, just maybe what happened to Magnetis and learnings you can take away from that?
Absolutely, yeah. It's something that we reflect on when we have companies like this that don't deliver the outcome that necessarily we wanted. But essentially, Magnetis was a robo-advisor that was dependent on very large scale with very slim unit economics. And I think one of the biggest challenges for them was that they struggled to find the scalable channels for distribution. It wasn't helped by the right rate cycle, which produced headwinds to distributing the kinds of products that they were distributing. And then, when private funding became a bit tight, and combined with Magnetis being subscale, the cuts that were necessary to make the company self-sustaining were too deep, essentially. At which point M&A was in its destiny. And in October 2023, BTG acquired Magnetis.
Over the course of our history with Magnetis, VEF invested $6.7 million, predominantly, across 2017 to 2019. The proceeds from the sale were negligible because we didn't participate as much in most recent funding rounds. I think as we reflect on this and the important takeaways, I think what we feel as a team is the importance of, you know, appropriately sizing for risk and reward investments in the early stage, before that the scalable channels were found. I think, I think establishing a framework for identifying and measuring product market fit in our investment process, which we have discussed at length with the investment team.
But I think, you know, one of the positives as well is we spent six years on the board of a company trying to grow in this space, and we've learned a lot of these lessons about this particular vertical of fintech, and it helps as we evaluate other businesses in this space.
Cool, thanks. I think just from my side, just looking Jumo in the same category, give or take, an investment that we brought down in Q4. Effectively, it's a company that we've been with since very early days in Africa, and they did actually manage to deliver scale through the journey that we've been with them. But when they struggled to do it at enough for sufficient unit economics to deliver a bottom-line positive. A lot of volatility in the markets they play in, notably Africa.
And it got to a point where they were raising fresh, capital in an aggressive manner, pay to play, reset up the cap table, and we had the decision to make, you know, what is the best use of our capital at this point in time, and we decided not to pay, and we had better uses of our capital as we underwrote the investment opportunity that was JUMO. I think the key learnings from this one was really around frontier markets being difficult, in short to medium term. You need to rightsize investments very much like what Alexis said at Magnetis, and I think we've done that in other frontier markets.
And then partners, which have been key to JUMO's success in scaling, can also be difficult through cycle and also be difficult on the economic front, where they can eat a lot of your lunch, as you go. JUMO still is very much a going concern. We wish them well, and they did raise the capital that they needed, just not our capital, and we're no longer part of that story. I think in both cases, I think the one important takeaway for us was, for the market is around our NAV marks.
You'll see in both cases we were marking these down well in advance of the situation that happened in Q4, where we moved them out of the portfolio so that it's a negligible impact from an NAV or from an economic point of view, as much as it is a negative for VEF to make mistakes like this on the investment front. A few more slides. I know we're running over a little bit, but I think there's some good content that we're sharing here, so we'll stick with it. I think slide 16, Alexis, just as we start to look forward, as this cycle starts to turn and rates start to move, markets start to open up, and how we think about this new cycle, maybe you can share some thoughts there.
Yeah. As Dave mentioned earlier in the presentation, I think, you know, we're getting very excited about the opportunity that lies ahead of us and just to update our investors and bring them along on the journey. As a team, we look at around 500 pipeline opportunities in emerging market fintech a year. And we're seeing a real improvement in the quality of the pipeline over the last three months. As highlighted on this page, there's a pronounced vacuum of growth capital for fintech , and when you spend time like we do in our markets. You see that this is even more exaggerated in our core markets, and how pronounced this is.
But generally, I would say we're definitely having healthier conversations with founders, on the balance of growth at attractive unit economics, and then also around valuations. And it's not just valuations with companies and founders, but also with other market participants. Sure, that's, you know, reflected in all of our NAVs being down from the peaks of the market, but it feels like a far more sustainable investment environment, with plenty of opportunities coming through. And I think just to flag some of the emerging themes that we're getting really excited about, as you've seen, we've got embedded finance on the brain and in our portfolio, and we've written some reports recently about the opportunity in embedded finance. Around that, and I think complementing that, we really like some of the infrastructure and banking-as-a-service opportunities.
And in some of our markets, we've seen huge opportunities and some growth opportunities in cross-border financing, which we're getting really excited about. And I think what's really important and drives a lot of our investment activity and excitement is the fact that we haven't stopped our travel, which is a core part of what we do. Over the course of 2023, we spent a lot of time in all of our core markets, which is really important as we interact with entrepreneurs face-to-face. We spend time with our local partners and investors, and really contribute to the ecosystem so that we're top of mind for being attractive partners for financing.
But all in all, it feels like we're coming out the other side of what's been a challenging time for venture-backed businesses, and we're only getting started. I think the opportunity that lies ahead of us is huge, as we continue investing in one of the strongest secular trends, across some of the world's fastest-growing markets.
Super. Let me wrap up with these last 3 slides, and then we'll open up for questions. I think first and foremost, you'll see the snapshot evolution of our share price versus our NAV per share, and obviously, that lingering discount. We're very aware of it. We're looking to close that this year through many different means at our disposal. And I guess that leads on to slide 18, and I guess, you know, the message to shareholders consistently is we care. We care a lot. We are shareholders, and we know the various levers one can pull to help reduce that discount to NAV over time. There are things short term in nature just to get that discount closed, but they're also medium- and long-term positive fundamentally for the business that we run.
They mainly link around areas like investor relations and PR. We're doing a lot more of that. We're reaching out to our investors. We're working with investment banks. We expect to have more coverage from investment banks, and obviously, this in the future, which will be a positive overlay for what we are. Increased transparency is always key. Getting our companies out there in front of investors, we're probably going to be more sessions with our companies, with investors this year, and potential investors. And then our companies like Creditas and Konfio, for example, will be at the Goldman Sachs Fintech Conference, LATAM in New York at the end of February. It's a great platform for investors to meet our companies firsthand and get the transparency that we have into the founders of these companies. And then you can't beat investment performance.
I think 2023 performance, from a NAV point of view, directionally positive 16%. Not saying you can extrapolate historic performance, but the trend is clearly positive. You look at the, forecast next twelve months revenue growth performance that we're expecting in the portfolio, that should feed through. And then companies raising money, with Gringo, raising capital in Q3 of 2023 above the last round valuation. I expect other companies in our portfolio in the first quarter, the first half of this year, to raise capital at or above last round valuations, or indeed our NAV mark. These are important metrics and marks that just help in the narrative and get the story back on track and closer to its fundamental fair value, give or take, at NAV.
From a capital position, which is a very important aspect of our story right now and all stories like ours, we end the quarter and end the year with $21.6 million, at that point. What's key to note, obviously, the, you know, besides the costs and the interest costs, which obviously bring down quarter-over-quarter, I think it was $35 million at the end of Q3, we're linking this to our bonds and where the movement in our cash position went. In Q4, we issued a new bond, a new sustainability bond. We redeemed our old bond. The metrics of that is that we reissued a $500 million SEK bond, but we took ourselves $100 million of that bond.
So effectively reducing our debt from SEK 500 million, or approximately $50 million, to SEK 40 million or SEK 400 million, and that was a deliberate move, from our side. We increased the maturity to 2026, December 2026, and that was good risk management, as we had the maturity of the bond in April 2025, reduced the amounts of directionally positive on the debt outstanding, while improving, the metrics for that bond. I think what I'd say to the market on this front, you know, we've always looked to stay ahead, from a balance sheet risk management point of view and stay logical, and always talking to our board and our shareholders as we move along the way.
We're very happy we issued our first sustainable bond back in 2022 at the start of the volatile period of 2022 and 2023. It put us in a very strong balance sheet position going into this cycle, and we're able to support the businesses in our portfolio through that with strength and also have a strong balance sheet. It was the right thing to do in Q4 of last year, in the window that came about, to redeem and reissue our bonds, maturity rates, reducing the amount, all positive movements. And that's what I think we're, we're saying to the market, directionally positive as we've got a goal to pay down this debt, you know, over the next 12-18 months. And how does that get paid down? Clearly, it gets paid down from cash in.
What we have on our side is a portfolio of assets. What we can communicate, we can't overcommunicate, but what we can communicate to the market is we've got initiatives on at least 6 companies in the portfolio. That's a broader range of initiatives looking deliver, to deliver exits, and for us at best and cash in, ranging from a full exit of a company right down to a partial secondary sale. With confidence within VEF that we can deliver the cash in that we need to take care of our bond through the prism of our portfolio in the next 12 months, and that's the key goal for us.
And some of that confidence feeds back from market-level confidence as we come into this year and we see Kaspi, Kazakh fintech, listing in Nasdaq, $18 billion market cap company, raising $900 million in the process of secondary shares, where the confidence comes from the IPO market reopening names like Klarna and Stripe, very much on the front foot there. At VC level, a lot of funds being raised and secondary funds being raised, and conversations are ongoing. And then at VEF level, most specifically and most importantly, we're very close to our portfolio companies. We're on the board of these companies, and we don't live in hope, we live in work. We work with these companies through to exit, and we can help influence the exits of our sales within that. But the process is ongoing.
We will share more when we have more, because I know you want more, and we'll get specific when the time is right. But that's the ideology and goals that we have for this year. And I think what you're seeing with our debt levels and what we're doing with our debt, it's directionally positive, and we're staying one step ahead of the game. And then finally, just to, I guess, review the investment case and outlook as we sit here today and I look into 2024, it does come back to NAV. NAV is back trajectory positive. I think most important for me, a lot of tailwinds last year were market-based, and we welcome them.
What I'm starting to see in the portfolio is a turn in companies, not just that we've got that 35% expected growth from a next twelve-month revenue, but we're going directionally positive in our internal forecasts. Names like TransferGo, Konfio, Solfacil, and Gringo, we've definitely been revising up numbers in a traditional analyst sense, as opposed to the other way around, we went into the 2022, 2023 cycle. We're very optimistic about our portfolio. When something doesn't work, we write it down. It moves out. When something is working, it's right sized, it's right valued. And we're seeing Creditas and Konfio coming out of nice cycles now in both of those markets for credit. Juspay classic structural growth and a number of other companies, which have us very excited.
Emerging markets is a big arena, but we are very exposed to Brazil and the cycle turning India structural growth and Mexico nearshoring. The portfolio itself, there's a mixed, much better maturity and risk reward in there from growth and break even capital positive versus just a burning portfolio of rampant growth, which was the way back in 2015 to 2020. The venture industry is signed and showing signs of recovery, both money in and money out and everything in between. And that's just helpful tailwind for how can we do it best. And our priorities are very clear. It's around strengthening our balance sheet, it's about closing that discount to NAV, and it's about getting back on the front foot in a cycle where we think we can make a lot of money for our investors.
So we did overshoot there from a double, what we planned, but let's stop there, operator, and let's open up the questions from the audience, please.
Thank you, sir. 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, it's 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 questions come from the line of Ermin Keric. Please ask a question. Your line is open.
Hi, guys. Thanks for the presentation and for taking my questions. Maybe, just first, I think you mentioned that you had initiatives for six portfolio companies on exits. Could you just tell us a little bit more about what does initiatives mean? Is that you're actively trying to do something, or is that inbound interest, like bids, et cetera, on six companies?
Yeah, sure. Hey, Ermin, that is a very fair question. You know, you give a bit, and people want more, and that's the natural way of the markets. No, it's just the way. But what I'd say is it's a mix. I think first and foremost, we work with and through our companies. So you know, we're investors in them. We know the families very well. We're on the boards.
We're not trying to do something around the side. So we're working, I think one can think, for the most part, working with and through companies into events that they're looking at doing or may happen to them from an M&A or a capital raise point of view. So scenario can be a capital raise, where a primary raise or a second retail on top of that, and that's something that we could lean into. Others, where companies have M&A conversations going on because somebody has leaned in, and we're part of the strategic debate there around whether it's the right price for this company at this stage or whether it's something that we want to do. Not yet are we thinking of doing something on our own away from the company. We probably wouldn't.
We'd look for blessing and work with companies through to clean transactions on our side. So there's nothing desperate in what we're doing. We're just working. I guess the focus is more on cash in as opposed to supporting our companies with cash into them in this window, and we're very much working with them on that basis.
... Superb, thanks, thanks for that color. Just in terms of priorities, you mentioned paying down debt. Do you completely rule out doing new investments when you get cash in from potential exits?
I would not like to rule out anything. I just like to be logical as we go, and I think the order of priority is pay down your debt or some of your debt to make it a much lower amount. It's a comfortable amount, but it can be lower, and lower is better than higher. Then you look at where you trade versus NAV, and it's a tough hurdle to get over to not buy back your shares before you actually put a dollar to work in a new investment. That's just math. But at the same time, the good thing about our shareholders is the conversation is ongoing, is that they want us to keep on finding the next Tinkoff or iyzico or Creditas.
If we do, we should be very clear to them that we have found it, and we want to invest in it. And if that means putting that capital to work ahead of putting it down toward debt or buying back because the opportunity is so great, then so be it. But it's not the natural first order of things.
Okay. No, but that, that makes a lot of sense. And then just one last question on Juspay. Could we talk a little bit more about the more long-term plan for the company? Is it to become more of a Pan-Asian player, or, or how should we think there? Because India seems quite unique, and as you alluded to, it's quite of a huge market as well.
Cool. Alexis?
Yeah. Thanks for the question, Evan. So, yeah, I think Juspay's vision is certainly to continue maintaining their position in India, but, you know, they have a very large and strategic position there. So we are focused on defending that. But outside of that, I think the team has ambitions to try and solve some of the similar problems globally. And I think in terms of prioritizing where they go globally, it's more they, they're doing it more on the basis where they are solving problems for existing clients in their geographies. So some of it does end up happening in, like, Southeast Asia. Some of it happens in the Americas as well. So they're kind of being led by their clients into big opportunities. But we are finding...
With the first few iterations of this, we're finding that their software and the solutions that they've already built just for India are crossing borders pretty well and more well than we expected. So I think they are very excited about global expansion, and probably, you know, it's, it's not a bigger priority than India, but, they-- yeah, I think they're very, they're equally as excited about global expansion as India.
Interesting. Thanks for taking the questions.
Cool. Thanks, Evan.
Thank you once again. To ask a question, 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 next question. The question's come from the line of Linus Sigurdsson. Please ask a question. Your line is open.
Afternoon, guys. Hope you're doing well. Starting out with a question about the growth outlook. So 35% down from 40%, is there anything besides moderating growth in Creditas driving this? Or is there anything you can say about this figure, sort of ex-Creditas, if you will?
Hey, Linus, and Alex, do you want to grab that?
Yeah, I'd say there are—I think the biggest driver of this number actually is the fact that our more mature portfolio companies, which are the larger portfolio companies, are a larger portion of our NAV this quarter. So I think that's the bigger driver here. I would say that actually names like Creditas and some of our other names are starting... We're starting to see, like, some potential reacceleration in growth. So I think that, you know, the biggest drive here is actually just the weighting to the more mature portfolio companies, because it's a NAV-weighted number.
Great! Thanks for that clarification. And then second, and lastly, I'd like to ask about the two exits or write-offs that you made in the quarter. You've obviously reflected on sort of the learnings that you've made, but do you see any sort of similar risks anywhere else in your portfolio as of right now?
So, Linus, look, we're in the venture investing game, which comes with some risks. And, you know, we've lived with these companies through the last few years, especially the last couple of years, which have been difficult in certain instances. Would I say within the portfolio of 15 companies that we have left, will we end up with another example, like a Magnetis or a JUMO? And the odds are probably yes, just because of the law of numbers. And if that were to happen, what you would see from an NAV point of view, they wouldn't be sitting up there in the Creditas Konfio Juspay position, which are obviously the game changers and the ones that are driving value.
They would be down the opposite end because they would be marked accordingly, because there would be risk within the business at that stage and point. So, I think the general answer, not to avoid it, we hate losing, we hate getting things wrong. We know over time, the big winners have outnumbered, in terms of value creation, the ones that we've got wrong, but each individual one that we do get wrong is a hit. And we take the learnings away and try not to repeat, or at least not make those mistakes again. But I think, you know, law of numbers says there will be another failure in our portfolio inevitably, you know, as we look ahead.
... That's a completely fair answer. So thanks for taking my questions, guys.
Yeah, thanks, guys.
Thank you. We are now going to take our next question. The question's come from the line of Rajiv Malhotra. Please ask your question. Your line is open.
Hi. So wonderful results. I'm one of your, maybe one of your few investors calling in from India.
Good morning.
Okay, so this is regarding Juspay. So the recent writings in the financial newspapers here talk of Juspay as somebody or a company which has missed lots of earnings by sort of, you know, making the original UPI almost for no money. And recently they have tried to spin off their mobility business. So, are you guys on board with that?
So, Rajiv, first of all, this is Dave, Rajiv. So thank you for calling. It's great to have Indian investors, and it's great for you to dial in. Alexis... And I'm sorry, just on Indian press, we look, we do read a lot of Indian press because the stories do come our way, and we do get many stories around our companies, which are a broad range of details in them. But Alexis, specifically to Rajiv's comments, can you share-
Yeah.
what you can share, and then
Yeah, absolutely. Rajiv, thanks very much for taking the interest and for being a shareholder. I think I know which article you're referring to. I think it was in The Ken or something a couple-
Correct.
of weeks ago.
Correct. Yeah.
I read the same article. I do... Like, I find some of the Indian press do, they do, I think a lot of it's not factually correct. So over the period that, you know, we've been shareholders in Juspay, they have gone from, like, $5 million of annualized revenue to, north of 40 now. So, you know, the trajectory of revenues is very, very strong. The unit economics are very strong. They have what you would expect for, like, soft, very, very high quality software-esque company, gross margins. I think The Ken is like...
Correct me if I'm wrong, but I think the, the way that they're spinning this article is that, that Namma Yatri, the, the mobility app that they helped create for the government, which was a very, very small project for them that was created by four people, was a pivot of some sort. But the reality is that it was a, it was a project that they did on the side, to, as they explored payments within mobility, and it just caught on like wildfire. And we as a board, sat down and discussed and said, "You know, is this core to Juspay and payments?
It's venturing more into, like, another field, and it makes a lot of sense for us to segregate this." Juspay to continue to be a shareholder in the entity, but to have a separate team and separate funding to fund a business that is not core to Juspay anymore. So I would say what's in the press is probably not that accurate, and it was far from a pivot. It's just something that's really just worked like wildfire.
Okay, great. So if the board is with, with what's happening, happy to be there.
Great.
Thank you. It's been nice being an investor with you guys.
Thank you very much.
Thank you.
Thank you. We have no further questions at this time. I will now hand back to you for closing remarks.
Super. Thank you, operator, and thank you, everybody, for dialing in today and for staying with us. I think it's been our longest call so far, but I think we got through a lot that was value-added for you, the investor. So yeah, thank you for your support. Thank you for listening, and we are available to answer any questions that you have on an ongoing basis. Feel free to reach out direct to ourselves or to Cathal, who runs our investor relations. But for now, thank you. I wish you a good rest of the day, and we'll talk again soon.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect your lines. Thank you.