Good day. Thank you for standing by. Welcome to the VEF Q2 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 need to press star one and one on your telephone. You will hear an automated message advising your hand is raised. To withdraw your question, you can 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 David Nangle. Please go ahead, sir. Super. Thank you very much, operator. Good morning, good afternoon, everybody, welcome to our Q2 presentation. As per always, I've got Alexis Koumoudos, our CIO, on this call with me, together we'll go through the investor presentation that we have on our website and the media platform. For the next 15 or 20 minutes or so, then we'll open up for Q&A and get your feedback. Going straight into it, in cube or page 2 of the presentation, I guess the, you know, key events of the quarter, I'll go through these quickly before we delve into detail as we go through the slides. I think the key event for us in this quarter is the NAV evolution, and it's been the key focus point for the best story year-to-date, i.e., recovery. What we've seen is the quarter-on-quarter in dollar terms, up 17% and now 25% year-to-date, obviously following the mood music in the markets where fintech listed shares are performing higher. We've got currency tailwinds in the markets that we focus on, like the BRL and the Mexican peso, and obviously underlying company performance therein. So our NAV at the end of the quarter ended up $479 million. This valuation obviously moves across the portfolio. There's obviously standouts in this depending on individual company performance and how their peers move in terms of those multiples and the currencies behind that. The Konfío is clearly a standout of 75% quarter-on-quarter. TransferGo, 35% quarter-on-quarter, and then Juspay at nearly 20%. We did see a lot of these moves across the board and from a lot of similar tailwinds, just to different extents, depending on different companies and where they were coming from. Creditas obviously still our biggest holding, our best holding. Still a standout, but it's driving a more moderated path to breakeven. That narrative has been very clear, both from us and from the company in any public statements over the last few quarters. The last set of numbers were Q1. We'll talk about them. There's now double-digit growth with getting a handle on, you know, managing breakeven, and that's the right risk reward at this point in the cycle, as opposed to maximizing growth and burning capital, at the back end. On the corporate governance front, we continue to move forward and strengthen the broader VEF team. At this time, at the level, welcoming Katharina Lüth, to our, to our board at the recent AGM. Great fintech and financial experience at McKinsey and an operator, and we'll double-click on her and what she brings to the table, in this presentation. There's a lot of words here around our fight to the trade of discount. You know, something that we take, very personally. We focus on it a lot, it is a battle, there's a lot of areas that we can do to benefit that, and that's obviously around portfolio fundraises at current NAV levels, increased transparency at VEF and at company level. The overall NAV performance obviously starts to extrapolate a trend for the market to look at, given what we've seen in Q1 and Q2, and it's improving constantly, our investor and public relations, and we'll talk about that. On slide 3, I think just from a numbers point of view, the numbers at VEF are very reflective of the numbers in the market, where we've seen our peak, our recent peak, at the end of 2021, and we took a NAV U.S. dollar point of view, $762 million, rounding up. obviously came off with a pullback in 2022, half of that 60% pullback, now back to $479.2 million. obviously, this is very much a function of being a mark-to-model venture capital listed company, as opposed to one that holds legacy marks. We like to move with the markets and constantly have an NAV mark that is true and transparent and market related. You see it from a per share point of view, which is obviously more important than the overall numbers, in SEK terms, we're now at SEK 4.97 per share, up from SEK 3.82 at the end of 2022. From a NAV USD point of view, the evolution, we focus on this chart because it gives a number of key takeaways. I think in the short term, what you're seeing from year end 2022 to today, and clearly I'm repeating myself here, but it is the main narrative, you know, NAV recovery, to $479 million, up to 25% year to date. You look over time back to 2015, you do see a NAV evolution and obviously NAV per share, as well, up and to the right, albeit more gradual. You saw the pullback after 2020, year end 2021 peaks. That's once again, us being very true and fair and clear and quick to react, to market moves and what are the fair market value for each of your positions. We did it during Covid, we did it again, in 2022, we work our way back up in line with markets, so we can always stand behind our NAV. I guess a big aspect of what moves NAV both in the first half of 2022 and the first half of 2023, albeit in different directions, has been the markets, and pure comps, effectively. Whether you're looking at your generic S&P 500 up 16% year to date, or 8% in the second quarter, or the higher beta tech, albeit it is certain stock heavy, 32% up here today. Pulling it back to VEF and being fintech focused, you've got the ARK and the FINX indexes. ARK obviously being a much higher beta index, the FINX probably more true to form for what we are at VEF. You're seeing real double-digit growth year-to-date in those. You bring that back to comp companies, which are used to value the companies in our portfolio who are mark-to-model, you've got names like Nubank up 50%+ quarter-on-quarter in Q2, even more dramatically, names like XP and Banco Inter up. A whole raft of companies which have been up strong year-to-date, which is indicative of the true and fair valuation of our companies as it reads through to them in our valuation marks. Before I hand to Alexis, this is just a breakout on an individual company basis. You see a bit more micro level, the evolution of the valuation marks of our companies over time. It is that year-end 21, 4Q 21, which stands out at a macro level, but also on a micro level, whether you're looking from Creditas right through down to Mudy and Abhi. The evolution from there as we pull back in 2022 and now back on the front foot in the first 2 quarters of this year. Alexis, can I pass it to you to take over for the valuation approach, and can you take what's around this, please? Yes, absolutely. Thanks, Dave. Hi, everyone. Just to reemphasize our valuation approach, which is important in helping explain the NAV evolution that Dave just gone through. You know, with oversight from our auditors, we continue to follow what we believe is a robust valuation framework, and that is that within the first 12 months from completion of latest significant transaction, we use the latest transaction valuation as the foundation for valuation of companies. Alongside that, we run a shadow mark-to-model analysis, where we compare the public comps traded relative valuation versus the implied valuation of the last round for the companies. If the mark-to-model, the shadow mark-to-model validates the latest transaction, we maintain that. Otherwise, which we've done in the past, we calibrate the latest transaction valuation to reflect the change in environment or company performance. Then beyond the 12 months, we are employing a mark-to-model methodology, which comprises essentially like 3 core components that most suitable publicly traded comps, the proprietary VEF financial model, and forecast for the business, and then other factors like FX movements and changes in net cash. I think one more thing, just to emphasize, is that, you know, while most of our companies and our positions are held through preference shares, which enjoy some downside protection, we maintain a conservative approach to valuation and don't factor in potential upside from these protections. That's just the overview once again and reminding you about the valuation methodology. On slide 8, you can see the results of that on the portfolio. For the second quarter of 2023, this quarter, 91% of our NAV is, and that 91% of our NAV represents 11 of the 17 companies, are valued at mark-to-model, and only 9% are valued at the latest significant transaction. Our conservative approach to portfolio valuation drove a big write-down, as Dave pointed out, at the end of 2022, and in the same way, it's driven the strong growth that we've seen year-to-date. The biggest driver of the strong growth in the quarter being the change in public comp multiples for the mark-to-model valued companies. You can see the top three companies there, which now represent 78% of our invested portfolio, driving a big portion of the NAV growth. I think one point, just to drill down a little bit more, I think it's something that's quite acute in this quarter, is that for each of our mark-to-model portfolio companies, we select a unique set of comps that us and our auditors believe are particularly relevant for that business. Some companies have some common components of the concept, but no two concepts are identical. Because of that, the median multiples of different groups will move up and down at different rates. You know, for example, in this quarter, you know, Creditas's median comp revenue multiple grew 13%, whereas Konfío saw a much larger 70% odd change. This is just a function of our process and that certain public comps performance changed at varying rates in the quarter. On slide 9, I think this just shows, again, I think what David described really well, is our NAV is now benefiting from the conservative reset we experienced in 2022 and is resuming strong growth, which is in line with markets and our portfolio company's closest comps, reverting towards more normal through cycle valuations. 91% of the portfolio is valued at mark-to-model, and tracking market moves until their next significant events. With new focus on achieving profitability and sustained profitable growth, the portfolio weighted top line growth will be in the region of 50% in 2023, a rate we consider to be very healthy. Given our valuation approach and proportion of mark-to-model valued companies, this rate of top-line growth will be the biggest driver of compounding our NAV per share from here, assuming all else being equal. We're proud to say that 94% of our portfolio can reach breakeven with current capital position or is already profitable. The remaining 6% of our portfolio have a runway of 14 months. Our companies worked really hard to make the necessary adjustments to ensure a sustainable future in a scenario that tough funding environment persists. We're pleased with the outcome. On Slide 10, and just to wrap up this section, you know, essentially, this is the NAV bridge that we've started to show the market. Essentially all of the second quarter NAV growth is attributable to the mark-to-market portion of the portfolio. Within that, $60 million came from the change in comp multiples. $15 million came from the strengthening currencies, predominantly Brazilian real and Mexican peso. With the reducing cash position at portfolio companies and some dilution offsetting that a little bit. I think the only other things to note on this slide are portfolio performance remains on track, albeit it was muted or neutral in this quarter, as we continue to moderate growth projections as our large companies accelerate their path to profitability. For the portfolio valued on latest transaction, we saw some dilution at rounds of portfolio companies that we did not participate in. That's negative $1 million. In... On the corporate side, the positive $2 million reflects the weakening SEK and therefore the reduction in size of the SEK bond liability. That's it from me on this slide. Dave, back to you. Super. Thanks, Alexis. Let's move away from valuation, and we do spend a lot of time on valuation because it has been front and center in the markets, valuation, portfolio valuation process. I'd like to think we've given as much as we can, and we'll keep on doing that. Now we need to kinda keep on market focus on what's important at best, besides valuation marks and NAV levels. You know, what is important is our portfolio. You know, are we invested in a quality portfolio of emerging markets, fintech assets? I guess our biased answer to that is we very much are. When we look at the top end of the portfolio, Creditas, Juspay, Konfío, Gringo, TransferGo, and the names roll on around the top half, which is the majority of our NAV. We feel in a very good place at this point in the cycle with the assets, the stakes in the assets that we have, to create value for us and our shareholders over the coming quarters and years. Obviously, that starts but doesn't stop with Creditas. Creditas is a big part of our NAV, as in the private space, I believe. Their Q1 numbers and the narrative around their Q1 numbers and the evolution of the story is quite clear. It's really in practice for being a public company, it's good practice through the prism of best to do that, which is something we bring to the table. The growth in their portfolio, you know, is 36% year-on-year. 30%, just above 30% year-on-year. What we're seeing on the revenue front is about 40% year-on-year, top line revenue at Creditas. This is for Q1. Q1 2022 numbers will be out shortly. This has come back from 2022, just logically so, as they run a path towards a more moderated growth path towards right risk reward in this environment before they, you know, arguably will put the foot down again into a better operating environment and in a better capital position environment for Creditas. I think the key underlying metric for Creditas is around their margin, their gross profit margin, which bottomed out at about 10% in the second half of last year, and now it's 20% plus and rising, and getting back towards that 40% true market averages. We say this a lot, but Creditas from a math and Excel point of view, has got itself in a very strong position where you can see accelerated growth coming through at a balance sheet level into next year and beyond in a falling rate environment. Margins are already on the up, irrespective of rates yet to start to come down, which will give add to those margins and the asset quality cycle starting to turn in Brazil. This is all off a much lower CAC and focused business model. Just a company that's in a very good position to win as we look forward into a better global and local Brazil macro environment. I guess that macro environment, not that we're macro investors, is really hanging around inflation levels, fall into low single-digit, while the interest rate still hang, you know, hangs around those 13 and a half percent global level rates globally. As a matter of when, more depth than a pace and when these interest rates start to fall in Brazil to the benefit of risk assets, fintech, and within that, Creditas is a key or should be a key beneficiary. We've also had Creditas out there a lot recently, at a Brazil also. Another name we've mentioned, this quarterly call is Konfío. I do so because of the move in the NAV and just once again, to reflect enough, it's one of our... You know, you get different moments in company cycles when companies are on the front foot, and Konfio feels that it's very much on the front foot with some good wins in its sales. Very much like Creditas, and they're quite akin in that they've got-... in fintech, so there's an element of a macro story and cycle as well as a structural growth story. Similar to Creditas, they've gotten fit over the last 12 months. Working capital is a key product of focus. They got to a very healthy position. Now, you know, David or Anna spoke on the HSBC event about a path to break even this year, having comfortable cash positions going into next year off the back of a break-even point. The loan book now and rising. That's only 1% of the current outstanding SME loan book in Mexico, which itself obviously is massively underpenetrated, and that's just loans. The path to a banking license a game-changer. We also become and brings through a much lower cost of funding through cycle and a sticky debate about the potential evolution of that as it marries with the working capital side of things. Just not as much information provided because it's a bit smaller, not yet there in terms of its path towards IPO and showing data, but starting to get there. This is one that's very much on the front foot, similar to Creditas. Touching on corporate governance, as we like to do every quarter, I guess this quarter focuses very much on the strengthening of our board. You know, we always think about our business on the capital side, our investors, who we love. On the asset side, which is our portfolio companies, which is invest well. In between, you need to continue to build a business for the long term, and that's just putting in place the structures, the people, the processes to help you succeed over time. When we looked at our board, probably was a gap, an operational gap in our board. We've got some great bankers, true cycle bankers, investors, PE, VC, but we didn't have was an actual fintech operator on our board, and obviously, we're investing in fintech companies. Katharina Lüth joined the board, very happy to have her in Q2 at the recent AGM. She's ex-McKinsey, so she is a financial classic financials, but also fintech. She took the step into being an operator as part of the team at Raisin, which is deposit gathering machine now in Europe and globally. It's adaptive, historically, in financials, in fintech, in emerging markets, but now more importantly for us, in the operational side. You know, she's got her, you know, feet wet, basically, in this space and knows what it's like to be in a fintech day-to-day, brings that to the board and the board level discussions, and we're very happy to have her. On the share price, investor relations front, obviously, with the move in NAV, today, with the share price aside, we're trading, you know, above 50% discount to NAV. As I say, something that keeps us focused. We cycle these windows can have, can be shorter or long, and we've seen it in the past, albeit not to this depth, of discount to NAV. It's something we're very focused on, day on day, week on week. We want to address this. I guess there is a mantra within VEF, it's, you know, right now it's increase the NAV per share and reduce the discount. We just keep on saying that and keep on trying to do it, as much as what's in our power. I guess what is in our power, this is a repeat of previous quarterly slides, but, you know, the investor relations on the PR front, we keep on trying new things to broaden, deepen the shareholder base and get our story out there. Publishing our own research. Solfácil was the most recent one. Out in Brazil Investor Day, we had in Sweden with FinanZero and Creditas both in town, the founders, the Swedish investor base, which is a big part of our investor base. We've hired a dedicated PR firm, forget there, mainly the Swedish retail, and which is a big daily trader of our stock. The transparency will keep on increasing, both at VEF level and company level as we can, but it's in the valuation approach, which we double-clicked on earlier, but also certain aspects of the portfolio, Konfío, giving a couple of numbers, broadly expected growth of the portfolio. Then I think the performance itself for our NAV, people start to extrapolate as that confidence builds and that comes through, and one needs to be patient around that. That's all within the prism of looking at portfolio today, but also a platform that can invest in future winners, and we're starting to get very excited about that, too. From a capital, the headline, I could say comfort with controllables. Balance sheet management is a key focus for us today. You know, we're sitting on $45 million of cash. It's a comfortable position, but it's not a war chest. It's not a war chest fighter for, A, you know, investing in the next tech in EM, or B, managing our debt profile as we roll forward to 2025. You know, we have time, we've got comfort, but we're very focused on as of today. We should be at about $32 million at year-end 2023. Our bond outstanding, SEK 500 million. Obviously, we've benefited from we alluded to. That's about a $46 million outstanding liability balance against the $45 million of cash that we have today. I guess solutions around this are classic for an investment company like ours. You know, exits, you know, are front and center as markets start to recover for some of our bigger, better assets as they move towards M&A and IPO. Also, you have the option of, you know, rolling that debt or just restructuring that debt in some shape, or on the equity side, as your share price increases and gets closer to NAV. Plenty of optionality around that and plenty of time, but something that we're very focused on. Finally, just to wrap up, I think it is worth it. I say this a lot, but we reiterated it at 2022 because it was a tough year. It was a in the life of an investment company like ours. You know, we stood up to strengthen our balance sheet with the bonds. You know, we put our arms around our biggest companies and made sure they were strong, and they are a very strong position today, with regard to growth in terms of strategy. You know, those moderated growth paths towards break even, especially around Creditas and Konfío. We marked our portfolio to market, quick, front and center in Q2 of last year, for the most part. We get into 20, feels we're not screaming bull market, but we are feeling tailwinds. A lot of tailwind comes because of the hard work it's gone to, but also because of the quality and the range of our portfolio, which is effectively the value in our company if you own a share. and Konfío, you know, refocused, getting fit, well capitalized, and set for next point of this cyclical growth story, albeit there's a lot of structural growth there, too. Juspay the classic structural growth story. We're benefiting from that, and that will remain a key engine of growth. Then there's lots of names coming through, and that will evolve over time. But, you know, I think TransferGo is one that stands out this quarter, as they reach breakeven, growing at a healthy clip in a very strong space. That's that team and the space that they're in is starting to impress us more and more. You're seeing it with names like Remitly and Wise starting to really perform in the public markets, and TransferGo is very much akin to them, albeit in a different geographic space. The NAV tailwinds are in, are in play, and I guess if there's one takeaway from this quarter, it's NAV tailwinds, and at 25% growth year-to-date, and how we value that. Capital, as I said, we sit on $45 million, so we're comfortable at this point. Just to reiterate those strategic priorities today, and we've got a lot of inaudible list, is strengthening our balance sheet and managing or dealing with that traded discount. That's where we spend a lot of our mental energy and otherwise. I will stop there. Operator, if I can hand back to you, and you can open up for questions at this stage, please. Thank you, sir. As a reminder to ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, you can please press star 1 and 1 again. Once again, please press star 1 and 1 on your telephone if you have any questions or comment, and wait for your name to be announced. We are now going to proceed with our first question. The question's come from the line of Joachim Gunell from DNB Markets. Please ask your question. Thank you very much, and good afternoon. A couple of questions from my side. Starting off with, I mean, this, it's just a marginal revision to the overall portfolio group rate for 2023. Perhaps you can just comment a bit about on a more broader perspective, which holdings are clearly ahead of your expectations, and perhaps also which have fallen slightly short thus far into 2023? Cool. Hey, Joachim, how are you doing? Look, I think it's a NAV-weighted revenue forecast, the bigger names will have a bigger impact on that. Within that, you know, from what we've done forecast-wise year to date, correct me if I'm wrong, Alexis, it's been, you know, pull back on Creditas. You know, you're moderating those growth levels to get to breakeven this year with the benefit coming, you know, into next year and the year after. The 12-month rolling, moderate pullback credit, Konfío going the other way, Juspay more or less steady state, which is about 70-78% of the portfolio. That's where you see your plus, minus, and neutral weighting. Below that, I'd say, you know, standouts, impressive names that have... We've been upping our forecast. You know, I touched on TransferGo, is one that's had a great 12 months, both on volumes and margins, and we've upped that. That's probably the standout below the big three. Great. when it comes to FinanZero's latest funding round, can you say anything about the cap table there, whether there were any quite new, external, investors also call it validating the valuation, which was in line with the previous round? Yeah, no, it's a, it's a fair question. We, we put the story in on FinanZero raising the capital because it was the only company that raised capital in the quarter, so obviously is an event. Obviously it was at the last funding round valuation, so it's a welcome event. Generally speaking, I'd say any capital is welcome capital in any of our companies. Specifically, was this high-end VCs coming in globally? No, the money that came in from this round was from the Swedish ecosystem, a mix of current investors and new investors, and a mix of high-end retail and VC funds within Sweden, without any name in between. Understood. I think this was... I mean, this is, of course, a priority. You really accentuate that the top strategic priority here is to strengthen the balance sheet over the coming one, two years. Can you just talk a bit about how you envision this to play out based on, obviously, your bonds maturing in Q2 2025? I mean, with the current discount, I mean, would it make sense to even call it, buy back the bonds, et cetera? Yeah, look, lots of strategic thoughts at the moment, Joachim, and it's a fair question. It's one of the things where we're working very hard on a lot of fronts. I guess, over time, we're working very hard to make sure we've built a platform that can invest in winning EM Fintech companies for the long term. I think we very successfully built that, and we've got a track record in place to justify that. You're obviously live with that for a period of 7 or 8 years, so you have an existing portfolio that you've got the ebbs and flows of markets with, as you had for the last 18 months to 2 years, and the way down and the way back up. There's a lot of work there into if anybody buys a share, invest the value creation within what you see, irrespective of the platform that actually builds that over time. Then you're looking at your balance sheet on the liability side, and what you want is a, you know, capital to put into that machine to support your current companies, but also, you know, find next gen winners. That traditionally has obviously been an equity play for us, and I think over time will continue to be an equity play for us. Unless the asset side of our portfolio becomes listed, which is possible, or starts to generate dividends, which is possible because more and more of these companies are maturing and profitable, and some are moving towards IPO. You get yourself to a position like we are today, and I guess the priority over the last 18 months has been on the asset side and getting ourselves to a comfortable position, well, a strong position on the asset side and a comfortable position on the liability side. How do we get from here then to a strong position on the liability side to marry that with the asset side? I think it's continued performance on the asset side and NAV, because that gives everybody comfort on the capital provision side, both equity and debt, as they look at us. I think, you know, when I look at our bonds outstanding, I see a very manageable amount, albeit we're far from comfortable, and we stay very focused on that. I see our cash position, and you're correct, you could see us buying back our bonds in the market. I'd say from a prioritization point of view, and this is more strategically than IRRs, buying back our bonds is ahead of buying back our equity, and probably day-to-day investing, at this point in the cycle. We're very close to our equity investors and our bond investors and the markets in general. Looking to work with them for the best balanced risk/reward solution for them as true cycle investors, but also us as an investment company. It's something, you know, we will start to make some moves on this front. I think up until now, it's been about a comfortable position. It's our ambition to make those moves, but I just see, especially on the debt front, whether it's nibbling at our bonds and buying some back, whether it's rolling them in some interesting way with some of our partners, or seeing exits from our companies, that will pay down that debt. One would like to think there's some kind of linkage from that to our discount to NAV, and that will obviously gap up, as that starts to wind down on the debt side, but we'll see. Great. Just finally, also perhaps, I mean, with some sort of, call it green shoots here, both when it comes to obviously how your NAV has performed here today, but also call it a more comfortable cash position, etc. Can you say anything about what learnings you draw here from this, call it VC reset, as opposed to previous cycles? Market volatility is not nothing new for you, of course, but are there any particular learnings from this cycle? I think everybody makes, you know, similar or different mistakes over and over again in these cycles. What I like in our portfolio is there's some structural growth stories, and Gringo and Juspay fit into that. Right now, it's like 100% structural, just up and to the right, and you can debate what that percentage growth is. You've got companies that break out in your portfolio, like Creditas, and you go, "Great, it's broken out. It's gone from, you know, a $100 million company to, you know, to a multi-billion dollar loan book in the making and proper top line revenues of $400 million plus." Once you get a certain size, you start to bring in the cyclical aspects. Structural growth gets you so far. You get big enough, you start to take the structural or the cyclical as. You know, we've had that in Creditas. It's almost like you looking at a listed company, us having Creditas in our portfolio. In the downsides, where you take down the valuation and you get fit for the next upcycle, albeit there's a lot of structural growth there. Learning this is on the, on the nature of a listed investment company. I think we're all being put in the same box at the moment, which is the glass half empty box, irrespective of your micro-level performance. I'd like to hope the market starts to differentiate going forward from, you know, people with better asset sides or better performance or stronger liability sides, and true cycle performance. That's for our market and then the market, the results, both the share discount to NAV. I guess that's a fresh learning of living as an investment company in a window like this and how the market treats you. You're almost innocent, and that comes in time. Great. Thank you very much for that, and, hope you both, David and Alexis, have a great summer. Yeah, you too, Joachim. Take care. Thanks. We are now going to proceed with our next question. The question comes from the line of Ermin Keric from Carnegie. Please ask your question. The line is opened. Good afternoon, and thanks for the presentation. Thank you for my question. Maybe the first one would be, the slide you show with 94% of your portfolio now being funded up until break even, as expected. I think that's up from like 70% in Q1. Is that primarily Konfío that's been added there, or is there anything else that we should be aware of that's kind of dropped in there? Alexis, do you want to grab that? Yeah. Yeah, sure. Yeah, I would say, for sure it's Konfío. At one point, you know, Konfío was pursuing a more aggressive strategy. They were looking at potentially making an acquisition. I think, once they decided to pursue the organic path for a banking license and move towards profitability, I think that was a big contributor to that 94% number. I think the other one is Solfácil as well, who decided to make some changes to the business and pursue a more sustainable growth path from the point of profitability. They are in the process of adjusting the business and working towards that. I think those are the two large ones. Got it. Thank you. Just on kind of different peer groups you have for your holdings, how many peers do you have minimally in kind of peer sets? I'm just thinking with Konfío, I think you said, you saw multiples move by some 70% roughly. Dave, shall I take that as well? Yeah. Yeah, I think specifically for the large ones, so, like a Konfío today has 4 peers in its concept, and then Creditas has 5. There's been a debate with us and the auditors about like size of the concept, big versus small, and I think we've always tried to focus on very, very relevant peers, but not to have less than, you know, or 2 or less peers in a concept. I'd say the bulk are sitting in kind of the 4-5 category. Perfect. Thanks. Then, just a final question on Creditas. As you also showed in the presentation, it seems like a Selic rate cut is basically imminent in Brazil. Is that part of your assumption when you're valuing Creditas at this point? No. I guess neither ourselves and Creditas and with different models, generally have a more conservative model than them, but neither of us put in place a Selic rate cut this year. Especially that was just to keep the company honest and keep our forecast honest around getting to a point of break even off the back of current macro steady state. You know, I think consensus is for, I don't know, it's 150 basis points by year end, and are starting in Q3 at some point. A debate around how quickly and how far we go over what period of time. No, that's not embedded in the forecast, specifically this year, and only very gradually into next year. Excellent. That's all for me. Thank you. Have a nice summer. Super. Thanks, Herman. Appreciate it. We are now going to proceed with our next question. The question's come from the line of Priya Rafed from KBW. Please ask your question. Hi, thanks for taking my question. A couple from me. The first is on Konfío. Obviously, they've had a great performance this quarter. What is your outlook going forward? Is this potentially like a candidate to IPO after Creditas? Also, obviously, you mentioned that Konfío are acquiring a banking license. Is there a timeline that they're working to on this? Is the idea to attract deposits as a funding source, or is this just to start branching out into new products? My second question is, obviously, you're seeing encouraging signs of fresh and positive investment vintage coming up, which I agree with. Which geographies or business models are you seeing, like, have the most opportunity, say, in the next 12 months? Thanks. Super. Thanks, Priya. I appreciate it. Look, let me handle the first one on Konfío, and then, Alexis, you can maybe jump in on the second one if you want. Yep. But like, on Konfío, they had a great performance this quarter in terms of valuation. That's obviously been a lot to do with the market comps and FX and its own individual performance as part of that. A lot of this is just recovery from what was in a very aggressive pullback in our valuation of Konfío over the last 12 months, in line with comps. The company itself is in a very good position. It's got some nice tailwinds as I mentioned in the presentation. A lot of that is just really down to focus on the working capital business model, which is a key part of what they do on the asset side. They obviously do cards, they do payments as well, and a small ERP business embedded. You know, you're starting to see nice tailwinds of what they're doing, a nice focused cost base feeding through, which gives them that comfortable ability to get to break even. You know, at more moderated growth rates, you know, this, once again, we're talking in the 30% plus minus balance sheet growth this year, as opposed to the triple digit before, as they grab that break even point and control of their own destiny, which is what you want from all your companies, at this point in the cycle. If you look at Konfío going forward, this is a company that could either IPO or M&A. Obviously, M&A can happen at any point in the cycle if the right bidder comes along with the right price and everybody's on board, to sell the business, but that doesn't feel like where we're at with Konfío right now, because there's a lot more to go in this company, a lot more value to be created. I think Mexico needs more better listed, you know, digital new economy companies, and Konfío would definitely fit that down the line, but not yet. I still think we're early on that front. Then you touched on deposits from banking license, and you've seen a lot of fintechs going from not wanting banking licenses to banking licenses becoming paramount to what they are, as they realize that fintech and financial services are one and the same thing. It's very key, and especially if I see the value potential in something like Konfío as a savings and loans, a digital savings and loans for SMEs in Mexico, it just, it multiples the value of Konfío, the digital lender for SMEs. The focus has been on that for a long time, been a process for M&A to buy a bank, which fell through for multiple reasons, and I'm actually quite happy it did at this stage. And now they're in a process for applying for a banking license direct with the regulator. Process is going very well. Yes, Priya, the plan is to gather deposits, so they will be an on-balance sheet lender and an on-balance sheet funder. Those deposits could come from a myriad of sources. They can either be sourcing those funds from their SME clients who they give loans to on the asset side. Or with that license, you can obviously tap, you know, a multitude of, whether it's private clients, retail deposits, something that can bring down your cost of funding and is stickier than what is the, let's call it, you know, double digits rate that you're paying for international funds to fund your deposits in Mexico at anywhere between 5%-9%, I think the average run rate. The better banks, the bigger banks are clearly in the 2%-5% category. The company doesn't need to go there to be successful deposit gather or have a big impact on its unit economics. That's on Konfío. Alexis, do you want to talk about the investment environment? Yes. Thanks for the question, Priya. I guess on opportunities for new investments and the environment for new investments, in terms of geography, I would say we continue to focus on what we feel are core countries that we know and understand really well, that we've got deep into, that we've spent time understanding, like the local market, the dynamics of the incumbents, the local culture around financial services. Those markets are Brazil, India, Mexico, and Indonesia, where we have yet to make an investment, but have invested quite a bit of time and spent some time on the ground as well. I'd say those are like the four core geographies. Each of those geographies are warming up for with opportunities at different paces. I'd say, like, India is probably the geography where there's such vast, dedicated capital to the opportunity that the investing environment has warmed up quickest, followed by probably Brazil and then Mexico and Indonesia. Yeah, that probably describes kind of the geographic lay of the land in terms of how we think about making new investments. In terms-- I know you asked about, you know, which ideas and models like, appeal to us. I think it's still very different, country to country, and we really like localized solutions for local financial service problems. I would say, generally, themes that we are seeing that we really like is the embedded finance theme, where, you know, we've made most of our recent new investments, whether it's Gringo, and financial services for drivers and cars or Solar for Sale around solar panels, we're really liking the embedded finance opportunity, and we're seeing more and more opportunities in that space. Hope that answers the question. No, that's very helpful. Thank you. We have no further questions at this time. I will now hand back the call to David Nangle for closing remarks. Super. Thanks, operator. Look, thank you, everybody, for taking the time again to be with us this quarter and listen to our presentation. I'm pretty interested in the questions. Thanks, as always, for following the story and being shareholders and supporting us on our journey. I think what you're seeing here today is a company and a team feeling in a good place, and we're not getting carried away by what we've seen year to date in 2023. We like to think it's only the beginning. I do use the word recovery, but tentatively, you've got to be careful in these markets. There's a lot of moving parts, but, you know, off the back of a lot of hard work in 2022 and hard decisions within that, we are benefiting in 2023. Obviously, off the back of a long duration of investing well in quality fintech companies, we're benefiting from those on the asset side, which will drive our price going forward. I've said before, the key mantra at VEF, is NAV per share, increasing it and decreasing that discount. Strategic priorities right now are around balance sheet and that traded discount. Thank you again. Enjoy your summer, and I'm sure we'll be talking to you soon. This concludes today's conference call. Thank you for participating. You may now disconnect your lines. Thank you.