Vef AB (publ)

STO:VEFAB

Earnings Call Transcript 2023-Q3

[Operator]

Good day, and thank you for standing by. Welcome to the VEF Q3 2023 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, David Nangle. Please go ahead.

[David Nangle, executive]

Super. Thank you, operator, and good morning, good afternoon, everybody, and welcome to our Q3 results call. I speak to you from New York today on the road, and we're very happy to walk you through our results of the last quarter and year-to-date, we'll do as per usual, myself and Alexis, our CIO, who's joining me on this call, we'll go through a number of slides which are available on our site and also by the [ Montrasystem ] and take about 15, 20 minutes to walk through latest talks, trends, et cetera, in the company and the portfolio. And then as Deborah will open up for Q&A at the end. Moving on to Slide #2, a kick off kind of key events of the quarter. What we're mentioning and what we'll delve into a bit deeper in the deck as we go NAV in Q3 was off at 12% approximately quarter-on-quarter, but 11% year-to-date. That's broadly in line with public market drivers, comp groups, FX and everything in between. As we stated many times, we have a portfolio largely marked-to-market and over 90% at this stage, hence, market moves do tend to dictate the direction of travel of our NAV on a very short-term basis. Point two is about Brazil. We are just back from Brazil as a team, both myself and Alexis. And we're not here to call macro or top-down trends, but the interest rate cycle is a key theme in that market, and they've had 250 basis points rate cost year-to-date in Q3. And so we're coming off highs in Brazil. And in contrast to much of the world, what we're seeing on the ground is a realization that we'll start with a new cycle. Very early days, very gradual and in all that, but rates down is generally positive for macro banking system and obviously, what we do fintech within that. And within Brazil, the 2 names to highlight in this presentation Gringo and Creditas, specifically, Gringo successful Series C funding round. We had a PR out on that recently. We supported this company, again, $3 million of additional capital in. We own about 10% of the Gringo and has a clear rise in [indiscernible] portfolio, and I’ll let Alexis delve into that in the presentation. And then on Creditas front, we also invested an incremental $5 million as part of a convertible note and internal round during the quarter to make sure it is well funded for this return to growth that we see happening in Brazil as you look into '24 and '25. And final point is on the venture industry itself. We get a lot of questions on this from investors in terms of where the industry itself is up because of many headlines, the story has gone around and mixed messages through the prism of best and what we see out there, we're seeing gradual recovery. It'll be like what I said on Brazil. Just a number of data points around capital being invested, exits happening, whether it be primary exits of M&A, IPO or secondary funds being formed, fundraises happening. We're just seeing a lot more activity coming through versus 3 months ago, 6 months ago, 12 months ago. So it's incrementally positive data points that we'd like to share. On Slide 3, key numbers for the quarter. We end the quarter at $423 million of NAV. As I said, that's down about 12% quarter-on-quarter, but up 11% year-to-date. From a per share point of view, everyone tends to look at the SEK given we are trading in SEK from a share price point of view, rough 4.42 at the end of the quarter, and that's -- we're trading from a share price point of view and over half that from a discount point of view at about SEK 2 a share as of today. Slide #4, just looking at the long-term duration and evolution of our NAV in dollar terms, as I say, ending the quarter at $423 million. What you see there, obviously, up until the year-end 2021 is gradual and in dramatic upswing in our NAV. We like the ideology of gradual up over time. And what we're seeing after what we pulled back our NAV in Q2 of '22 in line with market multiples, we were one of the first to do that for logical market reasons as we mark our portfolio [Technical difficulty] the portfolio valuation has basically been ebbing and flowing in line with the market moves mainly on the multiple front, but obviously, within that, you also have FX and our forecast for individual companies, but it's stopping and weaving around a similar level for the last few quarters. But year-to-date, we are seeing positive momentum of about 11% year-to-date. And where that fits in just on a short-term basis, you look at our portfolio down 12% quarter-on-quarter, people like say, whereas coming from, those a lot of individual moving parts within the analytics delve into them in the next few slides. But from a macro perspective, if you take the global fintech indexes in Q3, they're down on average about 8% in the quarter of the higher beta to what you see in Nasdaq and S&P indices off of 4% in the quarter. And then on top of that, you had some currency headwinds, the Brazilian real up 4% quarter-on-quarter and the Mexican peso of 1% to 2%. As one like year-to-date for the first 6 months, where it was universal tailwinds in terms of multiples and FX, this is all outside of the quality of the portfolio. And what's in there, Q3 was headwinds and not spent directly into a lot of the individual marks. And I guess on an aggregated basis, our portfolio moved broadly in line with that. Moving on to Slide 6. Alexis is going to pass over to you to talk a little bit about our valuation marks and the evolution over the quarter and what our investors need to know.

[Alexis Koumoudos, executive]

Yes. Hi, everybody. So on Slide 6, what you see is kind of the breakdown on a company-by-company basis and the contribution to the portfolio and the changes on a quarter-by-quarter basis. I think name to highlight here would be on an absolute dollar value move basis would be Creditas and Juspay and Yes. Both of those have moved down slightly and those -- that's a reflection of the comps and general market moves down over the quarter. Creditas, in addition, saw headwinds from the Brazilian real. And we have a deeper breakdown of an aggregate kind of bridge on the quarter-to-quarter and that breakdown further than the portfolio. But both Creditas and Juspay they're being affected by comps and Credita as on FX. I think other names to highlight would be on the percentage change front would be TransferGo and Solfacil. TransferGo saw its comps move very positively over the quarter. That's paired with TransferGo being a company which is growing its gross profit very quickly. It's one of our portfolio companies has become profitable, it's self-sustains in a position of being able to be self-sustaining. And it's one of the names in the portfolio, which is now compounding quite nicely, a bit like Nibo with very fast growth and gross profit. And Solfacil was a negative move. That is predominantly driven by comps as well. It's coincided with a move to -- from last transaction valuation methodology to make market. And over the past few quarters, we've seen some headwinds to the comp group that we have for Solfacil. They've traded down. And so the move and valuation there is just a reflection of those market dynamics. On the next slide, on Slide 7. So of the 17 portfolio companies that we have 12 are marked to market, which represents 92% of our NAV. 5 are valued on the last transaction, representing 8% of NAV. In the quarter, I'd say the large changes in valuation methodology were Gringo which moved to latest transaction with the successful closing of the Series C, which was led by Valor, and we'll dive into that a little bit later. And Solfacil, which I just mentioned, which completed the 12 months on the latest transaction, and we moved it to mark-to-market. And the bulk of the mark-to-market markdowns in the quarter were driven by comp group performance in the quarter, and we'll provide that usual bridge a little bit later. On Slide 8, I think things to highlight here, and this is the usual quadrants that we show each quarter. Despite the market headwinds in the quarter, we still see ourselves on a growth trajectory following the significant NAV reset that happened in 2022, delivering 11% year-to-date NAV growth. As we just mentioned, the bulk of the portfolio, 92% are mark-to-market. And is the 8% of which Gringo forms a large chunk are marked very recent significant rounds. I say with a big focus on achieving profitability and self-sustainability for our portfolio companies, we've seen like growth across the portfolio moderate from the highs of 2022, but we're still forecasting a portfolio weighted revenue growth of 40% year-on-year over the next 12 months. Just to highlight, we've changed how we disclose this. We think that it will be more useful for the market to look at this on a next 12-month rolling basis, which I think has gradually come down a bit, but we're very happy that this is a very respectable rate of growth for a portfolio like ours, specifically given the size and the maturity of some of our larger companies. And then on the right-hand side of that, 93% of the portfolio are already or can reach breakeven with the existing capital. 7% of the portfolio, which are typically at the earlier stages have not raised enough to achieve profitability, but they have a portfolio weighted runway of 27 months. This was lifted substantially in the quarter by the Gringo Series C. So that's Slide 8. On Slide 9, this is the bridge that we were mentioning. So at a high level, you can see that the portfolio continues to grow well, but it was not enough to offset the weak performance of comps and markets in the quarter as well as some FX headwinds. The biggest contributor to that decline in the quarter was marked in peer multiples, which we saw markets react to the prospect of rates remaining higher for longer. And this also contributed to a generally stronger dollar versus some of our currencies, specifically the real sterling and Mexican peso. On the corporate cash side, the reduction in the quarter is made up of OpEx, our coupon payments and the 2 portfolio investments that we made in the quarter that was $3 million into Gringo and $5 million into Creditas, which completes the $8 million that we've earmarked for portfolio commitments until the end of 2023. Yes. So that's it on the bridge for NAV. Over to you David.

[David Nangle, executive]

Thanks, Alexis. Look, the other thing I'd add to the point Alexis made about the portfolio is just, I guess, differentiating between short-term NAV moves and long-term portfolio potential. And I guess you get some of these short-term moves, which hit the portfolio because of comp groups in FX, but it doesn't mean a company is doing bad fundamentally. So we're very happy and very comfortable with the top half of our portfolio from Creditas right down as far as Nibo all performing now in a very good position and much better risk reward to us, albeit the short-term upmarket will be fully drawn by markets as we've laid out our so. And getting into a couple of the names within the portfolio, credit as always, as earth mentioned, given its size and shape in our portfolio. What to say here is more a continuation of the same Creditas Sergio and the team are very clear in laying out their store that its profitability over growth in this window. We've been very clear in reiterating that message to the market. And there are numbers coming through on a quarterly basis, albeit a little bit of a lag on top line numbers at tested up. So you are seeing a slowdown in growth in origination over the last 12 months. And you are seeing an improvement in the top line revenues and specifically in the gross margin. Revenues are growing the top line because of repricing of the loan book and the gross margin is improving because of that top line repricing. We're starting to see an improvement in the cost of funding because the rates coming down and also the cost of risk because of the asset quality cycle in Brazil and where it's at. So those gross margin is now at 28%. They were a low as 10% to 12% only a few quarters ago and trending back towards that 40% plus, which we know and love obviously from previous cycles at Creditas. And specific to that, obviously, the bottom-line focus is starting to come to fruition in terms of reducing that burn true to a bottom-line positive number. And that should be seen again as remembers come through in Q3 and then into Q4. And I guess the middle chart on the bottom of this -- on the Central Bank rate cycle is important for Brazil itself is important for macro into banking system, but specifically is for very important for people like Creditas and then also in our portfolio, entities like Solfacil within that, all of which benefit from an increase in lending volumes from lower rates, much lower cost of funding all feeds through to the income statements, balance sheet income statement and of all these key portfolio companies for us. Alexis, would you say a couple of words on Gringo, given that you're on the board there.

[Alexis Koumoudos, executive]

Sure. Yes. So we thought it would be worth highlighting Gringo a little bit in this presentation and trying to increase disclosures a bit around the name given the fund raise that they had. So in the quarter, as you probably saw Gringo raised an impressive Series C, which is led by top-tier LatAm, BC and a partner of ours and supported by all internal investors. It's one of the first series that we've seen close in Brazil this year, and it's a real testament to the quality of the team, the execution in this cost environment and the quality of the business that they've built. So as a reminder, Gringo serves 10 million registered drivers in Brazil with documentation issuance and payment services. And it successfully expanded its product suite to include a marketplace, which originates credit and insurance as well around the driver and its vehicle. It was one of [ vest ] embedded finance investments with highly verticalized payments platform and now expanding into other fintech products, building an amazing user experiences and use cases around drivers and vehicles. As I mentioned, Gringo has got 10 million registered drivers. They will double their revenues in 2023 following very strong growth of 7x revenue growth in 2022, and it expanded its gross margins to mid-40% this year. Gringo’s app is the #1 rated app in the auto sector, and it's built the most trusted brand and market drivers in Brazil. It's playing into a huge opportunity to serve Brazil 75 million drivers. And this by our estimation is a $20 billion market in just the documentation and issuance and fee opportunity before we add any of the credit insurance and buying and selling of vehicles, which the company intends to get into gradually and carefully over the next year or so. So we are very excited about what lies ahead for Gringo and see it becoming a more important name for [indiscernible] our shareholders.

[David Nangle, executive]

Super. Thanks, Alexis. Look, in the next slide, I wanted to touch on an area that a lot of people, a lot of investors, [indiscernible] business asks on about the state of our industry. Obviously, we're a listed investment company, but we play in the broader venture capital space. And we've got a generally net positive message to share. And I thought like an absolute positive as everything is on fire in a good way like it was in 2020 and '21. But what we're saying is as we live through 2023 and everything that we see versus what we lived through in 2022, which was [indiscernible] quiet and nonexistent for most of these aspects of the venture world, and things are moving in a positive direction. And I guess we start with investment activity, and that's obviously the capital going into companies in our world, be it very early stage through to late stage. What we've seen anecdotally is that the early-stage [indiscernible] and Series A has always been humming over in each of these markets, in each of our key markets. But this year, we're starting to see the later-stage checks coming through. And I guess you see that a little bit in our own portfolio to our Prism of Gringo and its Series E funding round, which is a quality around with a quality lead at a good valuation and [ upbrand ] from last time. Those deals are happening. You're also seeing with the money going into Creditas, more support for quality companies. And I guess then we pull back to the pitch book data for our 4 key markets of Brazil, Mexico, India and Indonesia, incrementally, in Q3, we're seeing that move net positive, still a far across from what we had in the bull market, genre, but definitely directionally positive. And also from an exit point of view, and we like to enter, but we look to exit and make money for our investors and move our NAV and our share price we are seeing exit again. And I look in debate on how well these IPOs are going, the quality, the depth of the market. But once again versus 12 months ago, it's night and day. IPOs are happening in the tech space, in the fintech space and the broader economy, and they're happening both globally and locally in the market that we play in. So we like this. On top of that, we're seeing secondary is happening more and more, quite a wide bid-ask spread still and but starting to happen. And then the M&A side of things that we've seen happen, specifically in Brazil, the Pismo acquisition by Visa, we mentioned a few times, was big for the ecosystem there and great see global fintech leaders like Visa still writing checks at this point in the cycle. And we've seen it through the prism of our own portfolios with a couple of offers coming through the last 9 months, not the right offer at the right price at the right time. But it's good to see those more anecdotally, from the VC fund point view, that dry powder, which makes the whole wheel turn on the way in and put more capital in the companies. We're seeing a number of fundraises from established fund partners that we work with. So it's generally a net positive message. It's incremental. It's gradual. It's a bit like what we're talking about on Brazil, very same ideology, but generally positive for everything that we do. And from a share price point of view, this is the market ideology of where our share price has been moving versus our NAV per share. We're still bobbing around those levels of 50% plus/minus discount to NAV. And as we've already explained this quarter and the last few quarters, this is a very marked approach to our NAV, a very realistic approach to our NAV. Closing the discount NAV, this is something we now put in each of our presentations I wrote about in most of my management letters because it is it's something of great importance to us, very important to our shareholders. We like to see ourselves almost as internal activists and how we approach this. We're all markets people. We get it. And we're very grateful to have fresh shareholders through a cap table of the likes of City of London and ABI, who invest in investment companies trading at a discount. We're working with them. We're talking to them, getting feedback on how to approach us, how to do something different more, and we'll keep on trying to do the right things until we do close that discount to NAV. And that's our purpose, and not their focus. I guess specifically this quarter, was to mention [indiscernible] from the U.S., we've been traveling here seeing over 60% of our shareholder base this week and on top of that, meaning a range of new potential investors and also working with the investment banking community to continue to get our story out there at this point in the cycle. And also, within that, we have our portfolio of companies, and we have Sergio from Creditas who's been out on tour meeting investors for the benefit of his medium-term IPO story, which is planned for 2025 first half, I would think, at this stage. And actually, this week, we have Konfio from Mexico, David Arana, the CEO there, meeting some of our biggest investors in the city of Boston. So that's improving the [ IOR ], getting the message out there, showing off our best assets that's consistent. It's increasing transparency as we go. You see it in the results deck today. You see it as we meet investors, put our companies in front of investors, all the data points we're giving out there is increasing transparency. And then we'd like to think that it's performance within the portfolio that eventually feeds through to the closing out discount through cycle. So this is ongoing. This is what we're focusing on, and we're doing it for all the right reasons. One more slide before I wrap up, and this is just around capital position that we are today. We -- from a cash point of view, we're sitting on $35 million at the end of Q3. As Alexis mentioned, we invested an incremental $8 million in the quarter to Creditas and Gringo and that was in budget. That's what we forecast. That's what we've done. We will be doing no more this year. We have nothing on plan isn't very much focusing in the portfolio at this point in the cycle and supporting your winners and making sure they're well placed to even win more as we look into 2024. We've moved the table on the chart on the top left to roll out to 2024. If we just assume costs and coupons, and we will end 2024 with about $21 million of cash on balance sheet. That's assuming no new investing. At this point, we are not assuming to make new investments. Things can happen, things can change. But given the cash position, given where we're at, we -- and given where our portfolio is based and biased in terms of the risk reward of that portfolio is much different than it was in the past with lower growth and path to profitability and quite clear. And while some companies may want capital and the needs aren't there that were maybe there in the past, and we don't need to be our first check in there. We've been very clear on that. So that's the way we're kind of looking at our cash position, and it will take a lot to get cash out of our pocket to make that picture change as we look into next year. And then we look at our cash position versus our bond. This is something we think a lot about just our overall balance sheet, our balance sheet structure and the future of that to maintain strong and moved up ahead of the game. And we have a bond outstanding, which matures in 2025 to SEK 500 million bond, about $46 million at current FX rates. The mix of how we approach this, obviously, our bonds are trading quite well in the local market. Last print was nearly 103. So unlike our equity, actually a very well trading be security at this point in the cycle. The bond market, we've got a good relationship with that, and we have options around our bond and what we can do next in terms of, I guess, on one level, you can pay back on another level, you can roll and then somewhere you could probably do a mix of both as you look forward. And then there a lot of work we do on the portfolio right now is around that exit evolution of some of the names. It is a healthier market, as I alluded to in the venture capital side. We do not want to force anything because we don't need to. But definitely, we are leaning in on exits for some of our -- some of the names in the portfolio, and I'd like to think one of this confidence at that we can make exits happen by year-end there's very clear confidence we could force some exits before that in the secondary market. So that's something we don't want or need to do, but it's just good to have that background security that you have near liquidity at hand should you need it. So that's the way we approach this. We're in a comfortable position with cash. We've got some controllables. We've got some decisions to make around our bond and rolling and paying back and exits and opportunities there, and that's more strategic decisions of how we do that over the next 3, 6, 12 months to put ourselves in a strong position as we look into 2024 and beyond. So to close off, just on the investment case on the outlook summary, look, in general, despite the Q3 performance of markets and our NAV, it's been a positive year-to-date. And really, for us, the positivity comes through the prism of our portfolio. And Creditas and Konfio are very well placed now at this point in the cycle because of all the hard work they've done in the last 18 months around cost, margins, path to breakeven, just paying the structural growth there continues we're very excited about that asset. And we keep on saying that irrespective of the Q3 NAV mark, which is comp driven. And then I mentioned a few names and the names coming through in Gringo, TransferGo and Abhi, but it could easily have out a Nibo, Solfacil, et cetera, to that. And we're very comfortable with the quality of our portfolio and the value creation that will come through there. I think the NAV tailwinds are in place by and large, and we're up 11% year-to-date. And the portfolio quality is wanting balance is another. I think it's the right point in the cycle not to have a portfolio growing on average revenues of 100% year-on-year but burning and having that at more 40% to 50% and close to or at cash flow positive is the right place to be. Also given our balance sheet, the risk/reward just fits nicely. And I do like the positive trends we've seen in the venture industry and they're incremental, gradual and positive. And our capital position, as per last quarter and the quarter before, it's a comfortable position with controllables embedded. And what is our strategic priorities today, short term, it's our balance sheet and it's their trade at discounts. It's hard to look beyond that because that's where the biggest short-term value can be created for us and our shareholders. Long term, it's all about investing in future winners in fintech and EM, but we want to win the short term before we win the long term. And I will stop there. And operator, I'd like to open up for questions at this point, please.

[Operator]

[Operator Instructions] Our first question comes from the line of Priya Rathod from KBW.

[Priya Rathod, analyst]

I've got 2, please. So the first one is on cash. And I know you touched on it in the report on the presentation, sorry, just now. But in the report, you do say that you're comfortable with your cash position and it's sufficient for the next 12 months. And last quarter, you did speak extensively on how balance sheet management is the focus for you. So would you be able to give a bit more color on your thinking and what progress has been made since the comment last quarter? And secondly, it's -- again fully along from that. Obviously, an exit would be an ideal situation. And Creditas is one of the companies which is one that you've given an update in the first half of 2025. And you did say that if you need to force some exits if needed, but you'd rather not. One, which the candidates of [indiscernible] Credita would be a potential exit? And do you think that you'd need to suffer a discount to the NAV, if you did end up forcing exit? Or are you happy that they now would end up even in that scenario. So any color on those questions would be great.

[David Nangle, executive]

Super, thanks Priya. Look what I'd say is we're very focused on our balance sheet. It takes a lot of our time and there's a lot of moving parts there. What happened since the last quarter into this quarter. Look, on the bond side, our bond continues to trade up, which we like. We are leaning in to the bond market in Sweden, where our bond was issued. We're staying very close to our bond investors, our bond investment banks. We're attending a bond conference in November and effectively just setting ourselves up to do something on the bond side, should we want to and should we see fit ahead of that bond maturing. So it's a bit like on the equity side, saying closer to equity investors, we're doing a lot of work on the bond side to be in a state of readiness to something and to do something as effectively to roll or all part of your bond and extended duration. So that's just one aspect of it. The other aspect of it, obviously, is the area of paying your bond down, and this is from -- as a priority for incremental cash coming in versus the cash that we have today. And just on the list of priorities you've got paying back your bond, you've end up buying back your shares given where your shares trade today and the value you can create from that. And then you've got new investments from a pipeline point of view. But on the exit front, there's a lot of thought credits obviously took at the top of our portfolio in terms of size and shape, and it's the one that's been most vocal about moving towards IPO. And I guess of all the exit opportunities, IPOs, obviously the most is the one that catches the most market attention. But what I'd say within the portfolio, there's 2 names that have had leaned in offers for those companies from quality global institutions looking to purchase these companies in the last 9 to 12 months, neither of which went anywhere because it wasn't it at the right time, and it wasn't the right offer. But that gives us confidence that broadly within the portfolio, we have assets which are very sellable from an M&A point of view. And also on the secondary market, which was barren, I'd say, in 2022, and starting to see signs of life. The bid-ask spread is quite wide. And what we're doing is we're leaning in where it makes sense to find out where the bid-ask spread sits with the names in our portfolio. So there's a lot of work going on there as well to make sure that we know where liquidity lies and at what price it like at. We feel from an NAV point of view that we have our portfolio mark-to-market I don't feel that we need to go out there and force anything today given the options that we have on the bond side about rolling over. And we're just looking through the right things about short-term balance sheet management and long-term shareholder value creation. So it's all in that balance. And that's why I say comfort with controllables, but the key decisions haven't been made yet whether we go left or right or somewhere in between.

[Operator]

[Operator Instructions] Our next question comes from the line of Ermin Keric from Carnegie.

[Ermin Keric, analyst]

Gentlemen. Maybe first a follow-up just on the exit market. Do you see any particular activity from other industrial players, either incumbent banks perhaps or kind of other tech players trying to consolidate?

[David Nangle, executive]

Ermin there's a lot of activity out there and there's a lot of conversations being had, whether it is global banks looking at, say, Brazil at this point in the cycle and global European banks are cash-rich on high interest rates, looking for opportunity to expand into scale markets, those kind of bigger conversations, the big global strategics, the likes of we said that made an acquisition in Brazil on payments front, Visa, MasterCard, [indiscernible], et cetera, are leaning in to certain places, but a lot of them with a discounted ideology in mind as opposed to a price to perfection ideology in mind. Within fintech, I guess you're seeing a lot of M&A, but the M&A itself is the strong taken over the week as opposed to quality M&A where both sides on a fair value basis. But I would say just the whole level of -- and this is then even within cap tables, shareholders talking to shareholders about passing positions left and right for certain price points. There's a lot more activity and conversations going on. And I guess that's where the previous question, what's happened in the last quarter with us, we've just been busy in the mix of a lot of these conversations, creating optionality and options for both our portfolio and our shareholders without wanting -- I guess, wanting to pull the trigger on an ES because we don't need to. We haven't had the we to pull the trigger in a heartbeat. If not, we'll wait.

[Ermin Keric, analyst]

Then a question on Creditors. I think both the company and you've been quite clear that priorities is profitability over growth. And it seems like they're making good progress on reaching towards that profitability towards the end of this year. But when we're looking at the portfolio, it's basically stayed flat now for a little bit of time. How should we think about that in '24, '25 when they reach that profitability?

[David Nangle, executive]

Yes. No, that's fair. Look, we kind of talk about it a lot in-house when we talk about Creditas and even with some of our other companies whereby you go from this window or a period of breakneck growth and growth at any price and everybody got used to it. And then 2022 happens to start and everybody has to quickly reset and refocus on getting to cash flow positive or profitability or earnings burn on a minimum as they become mastered on own destiny and sustainable. Then you kind of get near to that point, which we're getting near to that point with Creditas and Konfio and a few others. And then you start to lean back and go, well, where is the growth because we want it all. We want that profitability point and we want the growth because, obviously, markets won everything all the time. And I guess with Creditas, it's kind of become a right of passage to promise to the Board and our promise to shareholders that they will reach profitability. So that's been the priority over all else. And growth has us to give away to that. Obviously, the portfolio is mainly holding starting, but the income statement is moving positively forward. I think what you'll see is them reaching that point, proving that point. And then what we're seeing in the macro rates coming off with Credit as with its balance sheet strengthened a company that can put the foot back down on growth. And I'd like to think it's not breakneck speed growth. It's more reasonable self-sustained growth where you get that -- or seeing is something like transfer go or Nibo at the moment, where instead of 100% growth, you're getting 30% to 40% growth, whether it's balance sheet volumes revenues, and you're getting cash flow positive on the bottom line. Not a lot of cash flow positive, but it's just self-sustaining more realistic, still fast growth in any aspect, but not triple digit.

[Operator]

Thank you. There are no further questions at this time. Speakers, please continue.

[David Nangle, executive]

Super. Look, thank you, everybody, for continuing to follow our story. Thank you for dialing in to our quarterly conference call, and thank you for your general support to us through the last 18 months and indeed from some of new investors over the last 8 years. We are shareholders, too, we are very much focused on that and getting the share price higher close that discount to NAV, creating long-term value for shareholders continues to be at the top of our mind and as the folks of all our work today. So thank you again for listening in. If you need anything from our side, always feel free to reach out, and we'll talk to you soon. Take care.

[Operator]

This concludes today's conference call. Thank you for participating. You may now disconnect.