TriplePoint Venture Growth BDC Corp. Q1 FY2025 earnings call

• Venture market context: Venture capital dealmaking is affected by tariffs, equity market sell-off, and macroeconomic volatility, but investment activity remains underway with strong demand from quality venture growth companies.
• Investment activity: Q1 signed term sheets with venture growth stage companies at TriplePoint Capital finished strong, debt commitments to TPVG increased, and fundings in Q1 were $28 million with over $50 million in Q2 to-date.
• Portfolio: No credit downgrades, one upgrade, no new companies on the credit watch list. Focus on portfolio diversification and sector rotation, with a focus on sectors like AI, innovative software solutions, deep tech, etc., and companies with recent capital raises, ample cash runways, and prudent management teams.
• Tariffs: Impact on consumer and e-commerce companies sourcing overseas, but AI, software, B2B sectors not impacted.
• Revolut: Partial sale of equity resulted in a realized gain of $2.3 million, with Revolut having strong revenues and profit in 2025.

In the first quarter, TriplePoint Venture Growth BDC Corp (TPVG) had strong signed term sheets with venture growth stage companies at TriplePoint Capital, with Q1 signing over $300 million, totaling almost $640 million in the last two quarters. Debt commitment to TPVG increased in Q1, reaching two-year highs for new debt commitments to venture growth stage companies. Fundings for Q1 landed at $28 million, and by the second quarter, over $50 million had been funded. Total investment income for the first quarter was $22.5 million with a portfolio yield of 14.4%. Net investment income was $10.7 million or $0.27 per share. The company declared a regular $0.30 per share dividend.

• Fundings outlook: Q2 is on track to make up for Q1's shortfall, with the $25 million to $50 million quarterly fundings guide remaining in place.
• Credit outlook: Market conditions improved at the start of the year, but real-time monitoring of volatility and geopolitical uncertainty is ongoing.
• Leverage target: Target leverage of 1.3 times to 1.4 times, with plans to grow the portfolio using debt capital rather than share repurchases.

• Tariffs: Unpredictable impact on consumer and e-commerce companies sourcing overseas.
• Macroeconomic recession: Potential effects on portfolio prospects when evaluating companies.
• Market volatility: Impact on venture capital equity investment activity and portfolio company performance.

Q: Crispin Love asks about fundings outlook for the second quarter and beyond.

A: Sajal Srivastava says Q2 is on track to make up for Q1's shortfall, and the $25 million to $50 million quarterly fundings guide remains in place.

Q: Doug Harter asks about share repurchase vs new investments.

A: Mike Wilhelms says the target leverage is 1.3 times to 1.4 times, and the plan is to grow the portfolio using debt capital rather than share repurchases.

Q: Casey Alexander asks about prepayments and the Revolut sale.

A: Sajal Srivastava says prepayments are expected 1-2 per quarter, and the Revolut sale was a partial sale with a realized gain of $2.3 million.

Q: Brian McKenna asks about weighted average yield and sector mix.

A: Sajal Srivastava says the yield is consistent with previous quarters, and the sector mix includes AI, enterprise software, etc.

Q: Christopher Nolan asks about debt investments at floors and stock repurchase.

A: Mike Wilhelms says roughly 35% of debt investments are at floors, and the plan is to grow the portfolio to achieve long-term objectives rather than aggressively repurchase shares